July 12, 2006
Wednesday

WASHINGTON -- The House, seeking to advance its Republican leaders' conservative election-year agenda, handily passed a ban on most Internet gambling this week, but critics said the legislation could force banks to snoop on computer users and censor the Internet.

Advocates said the bill is needed more than ever because the rapid growth of online high-stakes poker playing and sports betting is fueling gambling addictions.

But Republican leaders also hoped passage would minimize the damage to the party from the scandal involving lobbyist Jack Abramoff. Abramoff's machinations, which are weighing down Republicans as they seek to keep control of the House in November's elections, sank a previous effort to ban Internet gambling in 2000.

Online gambling sites are based primarily overseas because most aren't allowed in the United States. But the legislation, which passed 317-93 with the backing of a bipartisan majority, tries to strangle the betting sites by making it illegal for those businesses to accept payments via credit cards, checks or from electronic payment services.

Banks would be required to try to block such transactions, and the Treasury Department and Federal Reserve would have to come up with enforcement rules. Criminal penalties for violations could include up to five years in prison.

Proponents, who frequently described online betting as the crack cocaine of gambling that has ruined families, said the ban is long overdue. They also warned that a crackdown is needed to prevent online gambling from spreading to cell phones and other handheld electronic devices.

"Internet gambling is a scourge on our society. It causes innumerable problems in our society," said Rep. Bob Goodlatte, R-Va., one of the measure's authors.

"The Internet is addictive for many people anyway, and Internet gambling can be double addictive," added Rep. John Duncan, R-Tenn.

Republican House leaders have made the gambling bill part of their "American Values Agenda," 10 pieces of legislation they want to pass before the election. Analysts say the agenda is an attempt to boost enthusiasm and turnout among conservative voters.

A broad coalition lined up in support of the gambling bill, including religious groups, sports organizations such as the NCAA, major league baseball, football and basketball and businesses such as eBay, which owns payment service PayPal.

Critics said the bill aimed at killing what's become a $12 billion international business represented governmental intrusion into people's private lives.

"If an adult in this country with his own money wants to engage in an activity that harms no one, how dare we bar it," said Rep. Barney Frank, D-Mass.

Rep. Ron Paul, R-Texas, warned that the gambling bill threatened the Internet. "I see this as a regulation of the Internet, which is a very dangerous precedent. ... What about political ideas or religious fanaticism? Are we going to go after them?"

Rep. Bobby Scott, D-Va., said the bill would be ineffective because banks and credit card companies would find it all but impossible to know when funds are being transferred to gambling sites, which could conceal their identities. "It cannot possibly be enforced," he warned.

Some opponents suggested that instead of trying to ban online gambling, the federal government should regulate and tax it. One recent study estimated additional federal tax revenues at more than $3 billion a year.

While the bill focuses on such online games as blackjack, poker and sports betting, it exempts state-regulated gambling on horse racing and lotteries.

The poker backers call those exemptions hypocritical and say they show that lobbyists have managed to protect other types of gambling at their expense. That argument raises the ghost of Abramoff, the convicted lobbyist whose schemes of influence peddling are at the heart of scandals that have snared several congressional aides and might bring down several lawmakers. Among Abramoff's clients was eLottery, a company that opposed earlier versions of the bill because those versions would have banned online lotteries. Abramoff helped block those bills.

"Many in this House have the opportunity today to purge the smear on the Congress that was placed by those actions. I urge my colleagues to take advantage of this opportunity to do that," Goodlatte said.

Outside Congress, Arnie Wexler, a "recovering compulsive gambler" who now counsels gambling addicts, said the bill was better than nothing. "It wouldn't be a bad thing, but it won't solve the problem," said Wexler, of New Jersey. He said there's no doubt online gaming, boosted by the increased popularity of televised poker games, has led to serious problems. "In my 38 years counseling gamblers, I have never seen such an explosion like in the last 1 1/2 years. ... It's poker, it's sports betting, and most of it is online," Wexler said.

Frank Catania, a former enforcement official at New Jersey casinos who is now a gaming industry consultant, said of the bill, "It will never work. Just as Prohibition didn't work. It's just as unenforceable."

Michael Bolcerek, president of the new Poker Players Alliance, said he wouldn't discount the bill's prospects of passing the Senate this year. He said the 23 million people who play poker online could find the federal government, their banks and their Internet service providers snooping on them.

"This would make it difficult to play online," Bolcerek said. "Awareness is growing among poker players, but I don't think most poker players who play online have any idea that this is happening."

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