Banning Doesn't Stop Rise of Online Gambling

March 17, 2009 | News Category: Gaming Law

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Although many people do not like Barney Frank (D-Mass), the Financial
Services Committee Chairman, it is difficult not to like his stance
on Internet gambling. He has often been the lone voice speaking out
against the United States government's attempts to ban online
gambling. Although it cannot always be said of Frank that he makes
policy decisions by consistently applying the same principles, he has
certainly held fast on his policy when it comes to online gambling.

When the UIGEA (Unlawful Internet Gambling Enforcement Act of 2006)
came into effect, it was enacted as part of the Port Safety Act, a
piece of legislation which is in no way connected to the UIGEA. It
seems that the attempts to hide the UIGEA by bundling it with
unrelated legislation were unsuccessful, however, for as soon as
Congress reconvened after it was passed into law (it was tacked onto
the SAFE Port Act in the final moments before the 2006 election
recess,) Frank challenged it.

Frank explained that, fundamentally, the act made no sense. He
challenged the idea that if a consenting adult in the United States,
who has his own money at his disposal, wishes "to engage in an
activity that harms no one, how dare we prohibit it because it doesn't
add to the GDP (Gross Domestic Product) or it has no macro-economic benefit?"

Frank posed the question as to whether activities engaged in by
adults that do not add to the GDP and do not
make the US more competitive, should be restricted. Those who reject
the UIGEA give many reasons for doing so, not least the claim that in
the present economic climate, the tax revenues that Internet casinos
could bring into the US would be rather significant.

During Prohibition, those wishing to abuse alcohol found ways to get
it despite the law. So too with banning online gambling. Those who
"need" online gambling banned are likely to be the ones to abuse it
whether it is either easily available or banned according to the law.
The UIGEA does not seem to have prevented US players from gambling
online. They are simply becoming more creative at finding ways
around the laws without actually breaking them.

Barney Frank plans to reintroduce his call to repeal the UIGEA. This
would include legalizing, regulating and also taxing online gambling,
just as other industries must follow certain guidelines and are taxed.

There is no reason why responsible adults should not be able to use
their own money, in their own homes, in order to gamble
recreationally. Those who have gambling problems are unlikely to be
deterred by being banned from making deposits through their bank
accounts to online casinos.

Interestingly, Internet gambling in the US has increased since the
introduction of the UIGEA. As with forbidden fruit, once it becomes
forbidden, everyone wants to try it.