Friday, April 18, 2014
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Internet Gambling Hearing Scheduled for April 16th

    PocketFives (press release)-

On Friday, April 16th, a hearing will take place in the House Financial Services Committee featuring discussion of two bills related to internet gambling in the United States: the Reasonable Prudence in Regulation Act (HR 2266) and the Internet Gambling Regulation, Consumer Protection, and Enforcement Act (HR 2267). The former bill delays mandatory financial services industry compliance with the regulations of the Unlawful Internet Gambling Enforcement Act (UIGEA) by one year, while HR 2267 seeks to establish a full licensing framework for the internet gambling industry. Despite the Committee discussion slated for both bills, no markup is scheduled.

Back in November, the U.S. Treasury and Federal Reserve granted a six-month delay in compliance with the UIGEA’s rules to June 1st. Now, that deadline is merely two months away, causing concern in the internet gambling industry. Safe and Secure Internet Gambling Initiative spokesperson Michael Waxman, who was recently a guest on the PocketFives.com Podcast, discussed the upcoming hearing in a press release distributed on Saturday: “This hearing will provide further evidence that the UIGEA is a poorly-crafted law that simply does not work. A more common sense approach to protect Americans is required. We expect this hearing to provide further impetus for the House Financial Services Committee and Congress to address this issue and move forward Chairman Frank’s regulatory bill.”

HR 2267, the aforementioned regulatory bill, was introduced on May 6th and features 66 co-sponsors. HR 2266 was brought to life on the same day and currently boasts 55 co-sponsors. Congressman Barney Frank (D-MA, pictured at right), Chairman of the House Financial Services Committee, introduced both bills and will now oversee their discussion in Friday’s hearing, which will take place at 10:00am ET in Room 2128 of the Rayburn House Office Building. Members of the online poker community who wish to follow the festivities live can do so via a webcast available on the official website of the House Financial Services Committee.

The hearing will focus on “governmental perspectives” of HR 2266, HR 2267, and the UIGEA regulations. In December, a similar hearing was held in the House Financial Services Committee. Witnesses included representatives of the Morongo Band of Mission Indians, WiredSafety, National Council on Problem Gambling, Dowling Advisory Group, Independent Community Bankers of America, and YouBet.

Noticeably absent at the December hearing were officials from the U.S. Treasury and Federal Reserve, which had issued the six-month compliance delay just one week prior. House Financial Services Committee Ranking Member Spencer Bachus (R-AL, pictured at left) called for a follow-up hearing to address concerns of these two agencies. Four months later, discussion of internet gambling will finally make its return to Capitol Hill.

On March 25th, Congressman Jim McDermott (D-WA, pictured at right) introduced HR 4976, the Internet Gambling Regulation and Tax Enforcement Act. The measure updates HR 2268, also introduced by McDermott, by adding a 6% tax on internet gambling deposits that would be diverted to state governments. In addition, HR 4976 mandates that a portion of the funds raised by a separate 2% federal tax on deposits should be given to those currently or formerly in foster care, historic preservation initiatives, and the arts. McDermott’s legislation could bring in as much as $70 billion over a 10-year period, a number that could help offset rapidly-shrinking state budgets and a pricey health care overhaul.

Partly in retaliation for the six-month compliance delay, Senator Jon Kyl (R-AZ, pictured at left) held up Treasury appointments as late as February. The general industry sentiment is that no further extension will be given, meaning that the June 1st deadline will likely stand.

On April 14th, two days before the hearing in the House Financial Services Committee, the Poker Players Alliance (PPA) will host a fundraiser at the Hyatt Regency Capitol Hill benefiting Ante Up for Africa. Now, that charity poker tournament carries even greater significance. Despite the timing, PPA Executive Director John Pappas told PocketFives.com in a previous interview, “This is going to be an event focused squarely on the crisis in Darfur. Hopefully, we’ll raise several thousand dollars.”


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