Wednesday, Oct. 2, 2002 | 11:11 a.m.
WASHINGTON -- The House on Tuesday passed a bill aimed at banning Internet gambling, but it is not likely to receive Senate approval this year.
Reps. Shelley Berkley, D-Nev., and Rep. Jim Gibbons, R-Nev., supported the legislation. They have watched the bill closely to make sure it would not ban Nevada casinos from launching online casinos if state regulators eventually make the websites legal in the state. MGM MIRAGE has launched a regulated offshore online gambling service and several other casino companies are interested in operating Internet gambling sites.
"I think we have met a compromise that safeguards the Internet; it protects legalized gaming and is something that is going to make a difference in going after these unregulated, off-shore sites that jeopardize American families," Gibbons said.
The bill would outlaw the use of credit or debit cards, checks or wire transfers for placing on-line wagers, effectively making it impossible to use gambling websites. The legislation is an attempt to bolster what is already technically an illegal -- but unenforced -- practice by cutting off the payment methods.
"This is a problem that must be dealt with," said Rep. John LaFalce, D-N.Y. "This bill does it in a surgical manner."
The legislation takes aim at off-shore Internet website operators by squeezing their businesses -- empowering law enforcement to identify and shut down websites with the help of Internet service providers. Law enforcement officers could also work with banks and credit card companies to shut off illegal payments, Leach spokesman Bill Tate said.
The bill also increases penalties from two to five years in prison, but foreign website operators would not face jail time if they avoided America, Tate acknowledged.
The bill passed on a voice vote after about 40 minutes of discussion, with bill supporters outlining their justifications. The lawmakers said the $4 billion Internet gambling causes social problems; funnels money out of the U.S. economy to fast-expanding 1,500 unregulated off-shore website operators; and provides terrorists with means to launder money.
Internet gambling is one of the most critical problems faced by U.S. families as parents and children -- especially college students -- plunge into debt, bill sponsor Rep. Jim Leach, R-Iowa, said. Online casinos often are at the root of divorce and depression, Leach said.
"The problem of Internet gambling is one we ignore at our own peril," Leach said, eventually concluding, "This is a family issue. It's a national issue. We must act."
The bill had the support of a wide variety of groups, including the Christian Coalition, the National Collegiate Athletic Association, the National Football League and Major League Baseball, Leach said.
Internet gambling websites prey on "the most vulnerable in society, including our college students and those who can least afford it," said Rep. Michael Oxley, R-Ohio.
America's youth spend up to four hours a day on computers and 80 percent of college students have a credit card, Rep. Spencer Bachus, R-Ala., said. "This bill is going to go a long way," he said. "You shut off the money -- you shut off the sites."
Internet casino advocate Sue Schneider said the lawmakers have long made baseless claims, including "reckless" rhetoric that terrorists operate the websites. There's no evidence of that, said Schneider, chairwoman of the Interactive Gaming Council, the leading trade association.
The lawmakers behind the bill, including Rep. Frank Wolf, R-Va., a long-time anti-gaming crusader, have a thinly veiled agenda, Schneider said.
"It was a lot of anti-gaming sentiment in general," Schneider said. "And it belies a lack of knowledge about the Internet."
In a statement, Schneider said, "The IGC will continue to accomplish as much as industry self-regulation can to prevent money-laundering, underage gambling and other social goals; but we again call on legislators to recognize that governmental regulation, and not prohibition, is the means to accomplish that."
The vote came three years into lawmaker attempts to pass some sort of Internet gambling ban, a tricky proposition because of the unwieldy nature of the Internet and off-shore website operators.
The Senate passed a ban in 1999 and a majority of House members supported a similar bill in 2000, but it failed to gain a two-thirds majority needed for passage.
A Senate bill that aims to ban Internet gambling outright is pending again, but not likely to be approved with time running out in the legislative session.
"There is significant interest in the Senate, and there is a vehicle for it there, but this place (Congress) is in such a disarray, I don't know how much time we'll have to make it work," Leach spokesman Tate said.
The Senate is swamped with last-minute business, including an Iraq resolution, the Homeland Security Department and budget bills, making it tough to squeeze in other legislation, Sen. John Ensign, R-Nev., said.
"I don't see it having a chance this year," said Ensign, who generally supports an Internet gambling ban.
Lawmakers would have to start over next year if the legislation does not pass both chambers of Congress.
The nation's top gaming lobby group, the American Gaming Association, does not oppose the bill, although it did not actively lobby in favor of it, president Frank Fahrenkopf said. The AGA had no objection because the legislation takes aim at what is already illegal and preserves a state's right to approve Internet gambling within the state, Fahrenkopf said.
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