House Judiciary Committee
Published: Thursday, May 25, 2006 Online-Casinos.com
HOUSE JUDICIARY COMMITTEE
More background on the House Judiciary Committee mark-up hearing today of Rep Goodlatte's HR4777 Bill seeking to damage online gambling in the United States.
Three House members from Nevada -- Jon Porter (R), Shelley Berkley (D) and Jim Gibbons (R) - this week introduced legislation for an 18-month study of online gambling and whether games could be regulated and taxed, as they are in Britain. Goodlatte said in opposition that such regulation could not exist in the U.S.A. because gambling is regulated at the state, not federal, level.
The Goodlatte bill effectively would prevent state lotteries from taking their games online, due to claims that the technology does not presently exist to reliably keep gambling within a state. Fantasy sports leagues would be exempt. Goodlatte has skirted one area where he can expect difficulties by saying that his bill "is neutral" on parimutuel horse wagering (a powerful interest lobby), which has an online component that is the cause of an ongoing struggle between Congress and the Justice Department.
The legislative fight over an earlier version of Goodlatte's bill was at the center of the recent Abramoff lobbying scandal, which led to guilty pleas by Abramoff and four former associates, including three former congressional aides. Abramoff's client, a gambling services company, opposed the bill, and the lobbyist funneled $50,000 of the client's money to the wife of a key aide to former House majority leader Tom DeLay (R-Tex.). The aide, Tony Rudy, pleaded guilty to charges that he conspired with Abramoff to corrupt public officials and defraud his clients. Questions about DeLay's role contributed to DeLay's decision to leave Congress.
The current Goodlatte bill is backed by religious groups such as the Southern Baptist Convention, professional sports leagues such as the NFL and online-auction giant eBay Inc. On the other side are members of Congress from casino-supported Nevada, who introduced rival legislation; casinos; an organization of small banks that says its members do not have the manpower to block all gambling transactions; and a vociferous group called the Poker Players Alliance. Civil liberties groups have also expressed concern at the possibility that interference with the freedom of the Internet through directives to ISPs could eventuate.
The Independent Community Bankers of America, a group of about 5,000 small banks that opposes Goodlatte's bill, said previous attempts got bogged down in complications and had little chance of passing. But Stephen J. Verdier, senior vice president for congressional affairs for the small bankers, said the Abramoff scandal "has raised the political saliency" of Goodlatte's bill. "It's kind of got us a little worried, frankly," he said.
Though banks have the right to examine all transactions and block them if required by law, they are in the business of making customer payments as quickly and accurately as possible, Verdier said, "not trying to decide if you're a good person or a bad person."
