Internet Gambling
Internet gambling has been illegal for some time, but law-enforcement agencies lacked effective mechanisms to enforce the ban. No one is entitled to circumvent the law simply because it is hard to enforce. With that in mind, I sponsored legislation to better enforce existing laws prohibiting Internet gambling. That measure became law in 2006.
Internet gambling is unique: online players can gamble 24 hours a day from home; children can play without effective verification of their age; and betting with a credit card can undercut a player’s perception of the value of the money that the player is losing – leading to possible addiction and, in turn, to bankruptcy, crime, and suicide. Professor John Kindt of the University of Illinois put it best when he called Internet gambling the “crack cocaine [of gambling]…There are no needle marks. There’s no alcohol on the breath. You click the mouse and lose your house.” (“Online Wagering Under Attack in Congress,” Associated Press, July 10, 2006.)
The Federal Trade Commission has warned that computer-savvy young people are at particular risk, and the National Collegiate Athletic Association, concerned about the risk to college students, urged enactment of a legislative remedy. The impact of Internet gambling on young people is well documented. For example, the one-time president of the sophomore class at Lehigh University in Pennsylvania robbed a bank to pay off his Internet gambling debt, and a young man in Scotland attempted suicide after using 13 of his parents’ credit cards and running up Internet gambling debts in excess of $300,000. (“The Hold-‘Em Holdup,” N.Y. Times, June 11, 2006; “Internet Addict Gambled away £158,000 on his Parents’ Cards,” The Times (London), June 16, 2006.)
Internet gambling is more than a social problem. It “carries a potential for fraud and money laundering and the involvement of organized crime in online gambling,” according to officials at the Department of Justice. The FBI’s Assistant Director pointed out that “Internet gambling is a multibillion-dollar industry. A significant portion of that is the illegal handling of Americans’ bets with offshore gaming companies, which amounts to a colossal criminal enterprise masquerading as a legitimate business. . . . The FBI is adamant about shutting off the flow of illegal cash.”
To thwart those who seek to evade the existing ban on Internet gambling, I sponsored the Unlawful Internet Gambling Enforcement Act. This legislation was supported by the National Football League, the National Hockey League, the National Basketball Association, Major League Baseball, the National Collegiate Athletic Association, pro-family groups, anti-gambling groups, and 49 state attorneys general. It directed the Federal Reserve and the Treasury Department, in consultation with the Attorney General, to write regulations to halt financial transactions for Internet gambling businesses and shut off the cash flow. The regulations have been issued and will take effect in December 2009. Off-shore gambling operations and others would like to overturn the regulations, and they’re spending millions to do so; they know shutting down illegal payments could put them out of commission.