Gambling News - June 2005 Edition

"Resistance Underway Against Bill to Ban Online Gambling"

Senator Kyl's on the warpath. Determined to steer legislation through both Congress and White House.

Critics of Arizona’s Republican Senator Jon Kyl and his legislation to prohibit online gambling say it will never succeed because the Internet gambling industry is far too profitable and elusive for Congress to be able to control it at this stage.

Mark Lesnick, who runs StartCasino.Com, an informational site for prospective online casino operators and founder of Alternative Solutions for Reliable Online Commerce, says: “The United States tried to ban online betting seven times and each time it failed”. He added, “The industry is so rewarding that any attempt by the U.S. government to stop it would be too late”.

Representatives of different gaming interests, such as the horse racing industry, tribal casinos and poker and sportsbooks, won’t let Kyl introduce legislation without a fight. The Congressional Horse Caucus, for example, recently sent a letter to the Arizona Congressman’s office, urging that legislation prohibiting Internet wagering exclude betting on horse races. They contend that off-track betting, including Internet and simulcast wagers, are “the lifeblood of the industry” and are protected by the Interestate HorseRacing Act.

The letter, signed by representatives Ben Chandler of Kentucky and John Sweeney of New York, asserts that “every recent version of Internet gambling legislation has contained clarification that its enforcement mechanism does not apply to account wagers on horseracing conducted pursuant to the IHA…. We believe that such clarifications are obvious steps to implement what has clearly been congressional intent for several years, and we strongly urge you to include such provisions in your bill”.

Senator Kyl’s legislation has a greater chance of passing now than ever before because the Republicans control both the Congress and the White House. A Las Vegas attorney, Tony Cabot, whose clients include horseracing interests, said that off-track betting accounts for three billion dollars a year in revenues and is responsible for the only growth in the horse racing industry today. “There will always be people who will be motivated to get around the prohibition”, he added. Most critics agree that the U.S. cannot expect to have significant control over the online gambling industry.

Senator Kyl is persistent. According to a spokesman in his office, the senator plans to introduce legislation in the summer that is similar to previous bills he has tried to push through Congress. This summer’s legislation will most likely be similar to previous legislation that tried to shut down electronic fund transfers for online gambling, also introduced by Kyl.

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