US congressman moves to legalize online gambling - Friday 29th of May 2009

A US congressman unveiled legislation on Wednesday which would legalize online gambling in the United States.

Representative Barney Frank, a Democrat from Massachusetts, said the bill would "enable Americans to bet online and put an end to an inappropriate interference with their personal freedom."

It would give the Treasury Department the authority to establish regulations and a licensing system for Internet gambling operators that would allow them to take bets from individuals in the United States.

Frank, who chairs the House Financial Services Committee, said Internet gambling operators would have to protect against underage gambling, compulsive gambling, money laundering and fraud or risk having their licenses revoked.

He said he planned to introduce separate legislation seeking to delay implementation of the bill which effectively banned online gambling in the United States, the Unlawful Internet Gambling Enforcement Act (UIGEA).

"The legislation will stop federal regulators from enforcing the UIGEA until Congress has had a chance to decide national policy," Frank said.

UIGEA, enacted in 2006, bans US banks, credit card and financial companies from handling Internet gambling bets and has been the target of fierce criticism that it would be an enforcement nightmare.

It is set to go into effect December 1, 2009.

UIGEA specifically prohibits gambling businesses from knowingly accepting payments made through credit cards, electronic funds transfers and checks.

The US ban on Internet gambling, enacted by the Bush administration and a Republican-controlled Congress, has been challenged as an unfair trade restriction at the World Trade Organization.

The European Commission has also launched an investigation into whether the US gambling ban discriminated against EU firms.

The head of US gambling website Youbet.com welcomed Franks legislation on Wednesday.

"Chairman Franks bill is a welcome and realistic approach to US Internet gambling," Youbet.com chief executive Michael Brodsky said in a statement.

"Illegal US online gambling is a growing multi-billion dollar industry," he said. "Chairman Franks bill recognizes those realities and would bring this underground activity into the light ... providing much-needed revenue in these difficult economic times."

Betting on horse races is currently the only online gambling allowed in the United States.

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