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Ten days ago, the House Financial Services Committee held a hearing entitled, "UIGEA Regulations: Burden Without Benefit?" Representatives from the banking industry, U.S. Treasury, and Federal Reserve all echoed the same sentiments: The regulations of the Unlawful Internet Gambling Enforcement Act are not actually enforceable. Full of vague language and dubious distinctions, the UIGEA has been a thorn in the side of the internet gambling industry for two years. The tide is about to change. On Friday, April 11th, it was revealed that Congressmen Barney Frank (D-MA) and Ron Paul (R-TX) {pictured} have introduced HR 5767, which "will forbid the Secretary of the Treasury and the Board of Governors of the Federal Reserve System from proposing, prescribing, or implementing any regulation that requires the financial services industry to identify and block internet gambling transactions," according to a press release issued by Congressman Frank's office.

The bill is one of the best the online poker industry could have hoped for. A stoppage of implementation of UIGEA regulations would essentially mean a return to normal for the still-blossoming industry. It stems from a series of concerns raised by the financial services industry during the House hearing. They include the lack of a definition of which transactions are lawful and which are not, the burden of the financial services industry to be the ultimate enforcer of UIGEA regulations, and the lack of free-flowing information among all the parties involved. Overall, as we've seen, the UIGEA seems be anything but enforceable.

Safe and Secure Gambling Initiative spokesperson Jeff Sandman summed up his thoughts on HR 5767: "I think the news is dramatic. It follows on the heels of an exciting hearing in which we heard from both the folks who are legislating and the folks who have to regulate and they both said that the UIGEA can't be enforced. The bill would prohibit UIGEA regulations from being implemented. What representatives from the Treasury and Federal Reserve are telling us is that the UIGEA just can't work. We've known this for awhile."

Concerns voiced by those like Congressman Frank have centered around the likelihood of President Bush vetoing any pro-internet gambling bill that comes to his desk before the end of the 2008 calendar year. However, this bill, and the hearing, represented a bipartisan call for change. Sandman comments, "The administration's own agencies have testified. I don't think it's a strong partisan issue when you have the financial services industry, which is saying this is going to hamstring us, and the Treasury saying the same thing. To me, it's a strong change in attitude from different vectors. It's no longer just the folks who want to gamble online asking for change. You can combine them now with the financial services industry and other legislative voices. It's creating some momentum."

In the same press release, Congressman Paul voiced his concerns: "The ban on Internet gambling infringes upon two freedoms that are important to many Americans: the ability to do with their money as they see fit, and the freedom from government interference with the Internet. The regulations and underlying bill also force financial institutions to act as law enforcement officers. This is another pernicious trend that has accelerated in the aftermath of the Patriot Act, the deputization of private businesses to perform intrusive enforcement and surveillance functions that the federal government is unwilling to perform on its own."

Although it's unclear how long a bill like this has been in development, it's safe to say that the overwhelming feedback by the financial services industry at the hearing brought the deficiencies of the UIGEA into light. PocketFives.com recently interviewed Congressman Frank to get his take on the hearing, though the interview was recorded before HR 5767 was introduced. Click here to listen!

PocketFives.com will keep you posted on this critical development. Thank you to Jeff Sandman for his insight into the issue.