The Unlawful Internet Gambling Enforcement Act of 2006 could stop the meteoric rise of online poker.
The act was tacked onto the Security and Accountability for Every Port Act in late September and passed through Congress shortly thereafter. President George W. Bush is expected to sign the controversial act.
The bill seeks to stem unlawful Internet gambling, defined as placing, receiving or otherwise knowingly transmitting bets or wagers by any means via the Internet where the bet or wager would be unlawful under federal, state or tribal law.
To do so, Congress passed the act with language requiring financial institutions to monitor and reject many types of money transfers to online gambling sites.
Edward Skala, chief of staff for Rep. Mark Kennedy, R-Minn., said the bill does not prohibit online gambling where money or other “financial instruments” are not at stake.
“It’s the same as people giving out poker chips at a friendly game of poker,” he said. “We’re concerned when those chips become equivalents for cash or those chips are used as financial instruments.”
Skala said gambling and gambling rings are connected with a variety of crimes.
“Some of those obviously finance organized crime and, increasingly, these are ways terrorists would like to get involved in terms of getting access to money,” he said.
On a larger scale, Skala said, gambling should not be encouraged in society.
“It’s something that has led to addiction amongst many people, great personal, financial and emotional ruin for a lot of people and (the legislation) would be in the interest of trying to prevent its expansion,” he said.
Members of Congress are not trying to outlaw gambling across the United States, he said.
Nursing junior Ashley Kulla said there is no difference between gambling online and doing so at a casino.
If Kennedy is looking to ban poker online he should just do so completely, she said, although that would be “ridiculous.”
“There are worse things to worry about and it doesn’t slow online gambling down at all; people are already trying to find loopholes – (Kennedy) should put more time into other places,” Kulla said.
Although the bill takes aim at poker and many types of sports betting, it would not apply to interstate horse racing currently allowed under law.
Online gambling will continue unabated in the short run, according to major gambling sites like Full Tilt, as banks have 270 days to comply after the bill is signed. Most major sites are examining the legislation and assessing its probable impact.
PartyPoker released a statement saying it would suspend all real-money gaming business with U.S. residents should the bill be signed.
Although poker’s popularity has skyrocketed in recent years – with $60 billion gambled each day in 2005 – the act could sound the death knell for the industry.
Nolan Dalla, media director for the World Series of Poker, who recently resigned his post as Director of Communications for PokerStars.com, estimated that U.S. players drive 70 percent to 80 percent of the overall market. Elimination of that market share could make operations and expansion of the online industry difficult or impossible, he said.
“This legislation could very well be the 1929 of poker – this could be the crash,” he said. “I foresee this doing enormous damage to the game of poker, the popularity of poker and the future of poker.”
The main reason, Dalla said, is that online poker sites provide a “training ground” for fledgling players.
Dalla noted that while free sites and pay sites serve a similar purpose, there is a stark difference.
“One is the minor leagues, one is Little League softball,” he said.
“It’s very unfortunate that there are some people that want to legislate morality, they want to come into our living rooms, they want to tell us how to live our lives; they won,” he said. “People that love freedom of the individual lost, and lost big.”
Language and implications of the act are only partial reasons for its contention among members of Congress – the process by which the bill was passed has widely drawn criticism from Democrats.
Lack of time for proper review or debate and attachment to seemingly unrelated legislation – that of port security – are the bill’s main criticisms, as well as that of Republican leaders, who purportedly pushed the legislation through a short time before the election period recess.
Chani Wiggins, deputy chief of staff for Sen. Mark Dayton, D-Minn., said the process is the main issue regarding the act.
“The biggest concern is whether this is a good bill or not. The way this was passed violates the very principles of democracy,” she said. “You have open debate, you don’t attach unrelated legislation to other bills just because they are going through; that is not a good way to do the people’s business.”