What typically is a fairly light Thanksgiving weekend news-wise in the world of poker has instead been an exciting period for the industry. As you know by now, mandatory financial services industry compliance with the regulations of the 2006 Unlawful Internet Gambling Enforcement Act (UIGEA) was delayed by six months to June 1st, 2010. Next week, a hearing in the House Financial Services Committee to discuss HR 2266 and HR 2267 may even lead to one of the two measures being marked up, which could result in discussion in Congress. Let’s take a look at how the industry has reacted.
Among those weighing in on Friday was Congressman Barney Frank (D-MA, pictured at left), internet gambling’s champion on Capitol Hill, who commented in a press release announcing the six-month reprieve, “The Department of the Treasury and the Federal Reserve Board of Governors deserve a great deal of credit for suspending these midnight regulations promulgated by the Bush administration which would curtail the freedom of Americans to use the internet as they choose and which would pose unrealistic burdens on the entire financial community.” The longtime Massachusetts lawmaker forecasted, “This will give us a chance to act in an unhurried manner on my legislation to undo this regulatory excess by the Bush administration and to undo this ill-advised law.”
Safe and Secure Internet Gambling Initiative (SSIGI) spokesperson Michael Waxman gave his watchdog organization’s take on the regulations being delayed until mid-2010: “We see this move by the Obama Administration as a decision to halt implementation of UIGEA in order to give Congress time to enact an alternative approach of regulating internet gambling instead of prohibiting it.” For over a year now, Congress has been bogged down with a fledgling global economy and monumental health care reform, casting issues like internet gambling to the wayside.
In addition to internet gambling, Frank’s Committee will also hear discussion of the Financial Stability Improvement Act and the Federal Insurance Office Act next week. Echoing the sentiments made by the SSIGI, Poker Players Alliance (PPA) Chairman Alfonse D’Amato, himself a former three-term Republican Senator, noted, “PPA is continuing its efforts to urge members of Congress to implement thoughtful and effective regulation of the online poker as opposed to outright prohibitions, which history has shown do not work.”
A bevy of organizations weighed in claiming that the regulations of the UIGEA were unclear, including the American Bankers Association, Wells Fargo, the National Association of Federal Credit Unions, and the Independent Community Bankers of America. Senate Majority Leader Harry Reid (D-NV, pictured at right) was among several lawmakers who “expressed an intent to consider legislation that would allow problematic aspects of the Act to be addressed,” according to the Federal Reserve and U.S. Treasury findings. Now, it remains to be seen whether legislation will indeed be formulated or whether the internet gambling industry will simply find itself in another quandary in June.The PPA and other organizations that petitioned federal officials called for a one-year delay to December 1st, 2010. However, only a six-month extension was granted. On the reason for the discrepancy, the Treasury and Federal Reserve explained, “The six month extension of the compliance period will facilitate the establishment of policies and procedures that require gambling businesses to document the legality of their activities to regulated entities.” The Federal Reserve and Treasury explained that documentation provided to banks may be sufficient to discern whether or not a business is engaged in unlawful internet gambling.
In the meantime, the online poker industry will anxiously await the Thursday, December 3rd hearing in Room 2128 of the Rayburn House Office Building. The debate kicks off at 10:00am ET and can be viewed via a streaming webcast on the House Financial Services Committee website.
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