UIGEA new positive bill just passed

[tristan727]

Even if Bush does sign this into law, there's going to be so much criticism over it, I think Obama will have no choice to repeal it.

I doubt he was elected on such a mandate...he'll be sympathetic, but busy I bet.

[lots0]

The reason Bush and cronies are pushing to get this regulation in place before they leave office is that once Federal regulations are in place and signed off by the current leadership they are almost impossible to get removed... The system was set up that way on purpose.

[Casinomeister]

Bush Administration Moves Forward on Midnight Rulemaking to Force Banks to Ban Internet Gambling

NFL Lobbyist Turned Political Appointee Accused of Improper Involvement in Rush to Issue Regulations

(Washington, D.C. - November 10, 2008) The Bush Administration is working to finalize regulations to enforce a ban on Internet gambling despite concerns raised by leading financial service companies that the regulations are ambiguous, burdensome and not likely to stop millions of Americans from gambling online. It is expected that the regulations, issued to implement the Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA), will be finalized at the last minute before they can be stopped by the Obama Administration – an orchestrated move being linked to a former National Football League (NFL) lobbyist now working in the Bush Administration. The NFL has actively campaigned against clarifying UIGEA and has opposed legislation introduced by Rep. Barney Frank (D-Mass.) to regulate online gambling in order to protect consumers and generate billions for critical State and Federal programs.

"At a time when the financial system is in crisis, it is irresponsible for the Bush Administration to rush through a fundamentally flawed regulation that even representatives of the Treasury Department and Federal Reserve have stated on record is unworkable," said Jeffrey Sandman, spokesman for the Safe and Secure Internet Gambling Initiative. "We are skeptical of the Administration's motivation to get this done at the very last minute, especially given the apparent involvement of a NFL lobbyist turned Bush appointee."

Last week, Rep. Steve Cohen (D-Tenn.) asked White House Counsel Fred Fielding to detail what role Deputy Director of Public Liaison William Wichterman played in the Treasury Department's decision to send the proposed rule to the Office of Management and Budget for final review on October 20. In a November 7 letter to Mr. Fielding, Rep. Cohen said he had been told that Mr. Wichterman "has been a source of considerable political pressure to speed this regulation through.'' The letter further stated, "The National Football League has been among the most vocal advocates for the proposed rule and the underlying law. I am sure you will agree that, at a minimum, the appearance of a conflict of interest is undeniable."

As recently as March 2008, Mr. Wichterman was a paid lobbyist for the NFL, which has been a strong opponent of all forms of Internet gambling except for fantasy sports – an activity that generates more than $1 billion a year in revenues. Mr. Wichterman recently left the law firm of Covington and Burling, which represents the NFL, to serve as a political appointee in the few remaining months of the Bush Administration.

Movement on UIGEA comes despite a commitment by the Bush Administration not to issue final regulations after November 1, 2008 except in "extraordinary circumstances." A delay in issuance of the final regulations was also expected given the September passage of the Payment System Protection Act by the House Financial Services Committee. The legislation would have delayed UIGEA implementation in order to develop regulations that do not harm the payments system.

"The Bush Administration is setting a horrible precedent of pushing through flawed regulations at the very last minute to deliberately circumvent the in-coming administration,” added Sandman. “The special interests, including the NFL, are clearly the big winners with this last minute maneuver, leaving already struggling banks and financial companies to implement costly and poorly crafted regulations.”

A fundamental flaw in the proposed regulations to enforce UIGEA is that they leave U.S. financial service companies to interpret ambiguous State and Federal gambling laws, which do not clearly differentiate between legal and illegal Internet gambling activities or transactions, according to a report issued by the Center for Regulatory Effectiveness.

Representatives of the Department of the Treasury and Federal Reserve System acknowledged the challenges U.S. financial institutions will face in attempting to comply with UIGEA in testimony before Congress in April. Since most payment systems are not designed to comply with this law, "it will be very difficult to shut off payment systems for use of Internet gambling transactions," said Ms. Louise Roseman, Director, Division of Federal Reserve Bank Operations and Payment Systems, Board of Governors of the Federal Reserve System. "The implementing statute will not be iron clad at all."

At the April hearing, representatives from the American Bankers Association, Financial Services Roundtable, Wells Fargo & Co. and Credit Union National Association unanimously opposed regulations proposed to implement UIGEA. They all questioned the fundamental approach taken by Congress in enacting legislation that forces financial institutions to implement unreasonable and costly solutions to achieve compliance.

"The UIGEA and the Proposed Rule do not provide a rational path towards halting unlawful Internet gambling," said Wayne Abernathy, American Bankers Association's executive vice president of financial institutions policy and regulatory affairs. "The path leads to an increased cost and administrative burden to the banks and an erosion in the performance of the payments system, but it will not result in stopping illegal Internet gambling transactions. Imposing this enormous unfunded law enforcement mandate on banks in place of the government's law enforcement agencies is not likely to be a successful public policy."

Mr. Leigh Williams, president of the technology division of the Financial Services Roundtable stated in his testimony concerns that enforcement of the proposed rules "could impose significant compliance burdens on financial institutions by increasing their role in policing illegal activities, determining whether a transaction is illegal, or by imposing ambiguous compliance requirements that could be subject to wide variations in interpretation by regulators and law enforcement agencies. We believe these functions are more appropriate for law enforcement agencies."

The testimony supports over 200 comments submitted to the Department of the Treasury and Federal Reserve System on the burden and ambiguity in the proposed rules to implement UIGEA.

"The reality is that UIGEA is unclear, burdensome and doomed to fail," said Sandman. "It simply does not make sense to impose more costs and burdens on financial companies, while the activity they are expected to stop flourishes in an unregulated, uncontrolled and underground marketplace. Congress should look to regulate Internet gambling in order to protect consumers and collect billions of dollars that are being lost to offshore Internet gambling operators."

The Internet Gambling Regulation and Enforcement Act of 2007 (H.R. 2046), introduced by Rep. Frank, would establish an enforcement framework for licensed gambling operators to accept bets and wagers from individuals in the U.S. It includes a number of built-in consumer protections, including safeguards against compulsive and underage gambling, money laundering, fraud and identity theft. A companion piece of legislation that would ensure the collection of taxes on regulated Internet gambling activities, the Internet Gambling Regulation and Tax Enforcement Act of 2008 (H.R. 5523) was introduced by Congressman Jim McDermott (D-WA). According to a tax revenue analysis prepared by PricewaterhouseCoopers, taxation of regulated Internet gambling is expected to generate between $8.7 billion to $42.8 billion in federal revenues over its first 10 years.

About Safe and Secure Internet Gambling Initiative

The Safe and Secure Internet Gambling Initiative promotes the freedom of individuals to gamble online with the proper safeguards to protect consumers and ensure the integrity of financial transactions. For more information on the Initiative, please visit www.safeandsecureig.org. The Web site provides a means by which individuals can register support for regulated Internet gambling with their elected representatives.

[lots0]

Poker Players Alliance asking for you to join the REAL Fight...

Poker Players Alliance is pitted in a fight to keep anti-Internet poker regulations from being enacted and we NEED YOUR HELP!

The current Administration is hastily finalizing a number of “midnight rules” before they leave office and the Unlawful Internet Gambling Enforcement Act (UIGEA) is on the list. See the 11/06 story in Dow Jones. Just like UIGEA was snuck into legislation in the dark of night in 2006, our opponents are again trying an 11th hour sneak job. We need you to help us expose and stop this reckless rulemaking.

Please call the U.S. Federal Reserve and tell them not to approve the UIGEA regulations -- Consumer Complaints, 888-851-1920 or Public Affairs, 202-452-2955.

Tell them:

* The federal agencies responsible for our nation’s economy should not be focused on Internet poker regulations.
* Finalization of the UIGEA rules will add additional burdens on our already crippled financial systems.
* Internet poker is a game of skill and form of recreation for millions of Americans; it should be exempted from the UIGEA.
* Please do not finalize the UIGEA regulations until their impact on our banking systems and average Americans has been fully studied.

[jas2587]

I called the phone # above they said to go to
www.federalreserve.gov

then click about the Fed
then click contact us
then fill out the email
then click send

Done

Good Luck all

its worth a shot if all CM members do it

Cindy

[Casinomeister]

For Immediate Release: November 10, 2008

Contact: Steve Adamske (202) 225-7141 or Heather Wong (202) 226-3314



Frank Calls on Bush Administration to Delay Internet Gambling Regulations

Rules to take effect on January 19; Bush promised end to “midnight regulations”



Washington, DC—House Financial Services Committee Chairman Barney Frank (D-MA) today wrote to Treasury Secretary Henry Paulson and Federal Reserve Board of Governors Chairman Ben Bernanke asking them to postpone issuing regulations pursuant to the Unlawful Internet Gambling Act.



Frank wrote, “I am deeply disappointed to hear that your agency is proceeding with what I consider to be unseemly haste in issuing regulations implementing the Unlawful Internet Gambling Enforcement Act. This midnight rulemaking will tie the hands of the new Administration, burden the financial services industry at a time of economic crisis, and contradict the stated intent of the Financial Services Committee.”



The full text of Chairman Frank’s letters as follows:



November 10, 2008

The Honorable Henry M. Paulson, Jr.
Secretary
U.S. Department of the Treasury
1500 Pennsylvania Avenue, NW
Washington, DC 20220



Dear Mr. Secretary:

I am deeply disappointed to hear that your agency is proceeding with what I consider to be unseemly haste in issuing regulations implementing the Unlawful Internet Gambling Enforcement Act. This midnight rulemaking will tie the hands of the new Administration, burden the financial services industry at a time of economic crisis, and contradict the stated intent of the Financial Services Committee

As you know, at our April hearing, the testimony of your representatives and the industry indicated that it would be particularly difficult to craft workable regulations to effectively enforce the statute without having a substantial adverse effect on the payments system. Subsequently, my colleagues and I introduced legislation (HR 5767, later HR 6870) that would prohibit the implementation of these flawed rules and replace them with a formal rulemaking process that would define the term “unlawful internet gambling,” something the proposed rules fail to do. HR 6870 was passed by the Financial Services Committee on September 16.

The proposed regulations, like the underlying UIGEA statute, fail to define the term “unlawful internet gambling,” leaving it to each financial institution to reconcile conflicting state and federal laws, court decisions and inconsistent Department of Justice interpretations when determining whether to process a transaction. Furthermore, some of the information needed to make this determination would likely be unavailable to banks because customers or financial institutions in foreign jurisdictions will likely be unwilling or unable to provide it.

I strongly urge you to delay implementation of these major, and deeply flawed regulations to permit the incoming Administration the ability to review the consequences of such a significant policy decision, rather than unfairly being denied that opportunity.

BARNEY FRANK



***



November 10, 2008



The Honorable Ben S. Bernanke

Chairman
Board of Governors of the Federal Reserve System
20th & C Streets, NW
Washington, DC 20551


Dear Chairman Bernanke:

I submit to you the letter I sent to Treasury. I realize that the implementation of this flawed statute is not a task you requested. I also appreciate the candor with which your representative answered the questions at our hearing, confirming that this is an impossible task. There is no evidence that these issues have been in any way overcome. I strongly urge you not to burden the new Administration with administering a statute which cannot be carried out

BARNEY FRANK

[vinylweatherman]

Perhaps the banks should take the Kentucky line, as used in their case, that if there is no law saying a specific gambling transaction is legal, then consider it to be illegal. This means that all those self interested parties that negotiated the carve-outs would also find that THEY had trouble getting their transactions through until they had managed to get in place specific laws that made each individual kind of bet legal, and this would have to be repeated for each state, lest inter-state confusion STILL caused transaction failures.

This would only temporarily hurt offshore companies, who would soon find ways around the flawed and ambiguous regulations, knowing that they were now "finalised".

If players found their "legal" gambling curtailed as an effect of flawed enforcement, they are MORE likely to turn to the offshore companies, not LESS likely.

The BANKS are not going to spend money on being the moral police, they will find the most efficient, cost effective, manner to enforce the LETTER of the regulations, and will not worry about the INTENT, which is to allow some online gambling if it went to the "carve-out" operators, but block the rest.
The CHEAPEST option by far would be to block ALL transactions that they both KNOW are "online gambling", AND those where "certain indicators" show that the transaction is "more likely than not an online gambling one" - all this being automated, with little in the way of an appeals process to get a "legal" transaction unblocked because it inadvertently got blocked by "indicators" despite being legal.
Banks are NOT simply going to take the word of the customer attempting to gamble that it is legal, are they!

[Mousey]

Cohen calls White House anti-gambling effort ‘midnight rulemaking’
By Bartholomew Sullivan (Contact), Memphis Commercial Appeal
Originally published 05:24 p.m., November 10, 2008
Updated 05:24 p.m., November 10, 2008


WASHINGTON — U.S. Rep. Steve Cohen, D-Tenn., has written a letter to White House counsel Fred Fielding complaining that it appears the Bush Administration wants to finalize federal rules against Internet gambling before it leaves office.

Cohen, a proponent of the Internet gambling that Congress banned in 2006, also raised questions about William Wichterman, a White House staffer. Wichterman represented the National Football League, a proponent of the proposed rule, as a lobbyist as recently as March of this year.

“I am sure you will agree that, at a minimum, the appearance of a conflict of interest is undeniable....

[jetset]

Yeah - prior to his White House appointment this guy Wichterman was working for a lobbying company and its National Football League client, specifically on anti-online gambling moves.

And before that he was one of Senator Bill Frist's aides.

Ya - I'd say he would have some conflict of interest to explain...

[lots0]

I don't want to be accused of being a conspiracy theorist, but....

Why does the NFL have such a strong stand against online gaming?
Why would the NFL spend millions on lobbing against online gaming and even go so far as to hire lobbyists (White House Staffers) to attack the online gaming industry?

The NFL's stated reason for opposing online gaming is that gambling on the NFL games will compromise the games and the players...

Yet, the NFL says nothing about the 100's of Millions of Dollars that are wagered on NFL games in Las Vegas and other land based casinos inside the USA and around the World...

Just what makes these land based sports bets different than online wagers? Absolutely Nothing...

What then makes the NFL such an enemy of online gambling??

You can start with this tidbit of info...
The current NFL Commissioner is Roger Goodell, the son of the late United States Senator Charles E. Goodell, is a Republican from New York and a Evangelical born again Christian, that has embraced the Neo-Con philosophy of the Bush Administration...

The NFL's stand against online gaming is religious/political in motivation... Their position has nothing to do with gambling ruining the 100's of millions in corporate profit from the game...

Do you know who wants to be NFL Commissioner with all her little heart.... Conda Lisa Rice...