UIGEA new positive bill just passed

[Casinomeister]

PR UPDATE!

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, DCHouse 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 Franks 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]

Rep. Cohen complains about midnight rule making

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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...

 

[Mousey]

from the Las Vegas Review Journal....

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Despite an earlier announcement that it would not issue any new "final" regulations after Nov. 1 except in "extraordinary circumstances" -- and despite concerns raised by the nation's bankers that the proposed regulations will be hard to obey and are not likely to work -- the outgoing Bush administration appears to be racing to finalize rules to enforce a ban on Internet gambling before it leaves office.

Critics also object that the new rules -- designed to ...

Given the current state of the nation's banks and the financial sector in general, it would be hard to imagine a worse time to impose on those institutions an ill-thought-out set of rules which will balloon their compliance costs and expose them to potential fines or prosecution should they fail to divine "legal" from "illegal" transactions (a task better suited to a psychic with a turban and a crystal ball), especially when -- according to all sources -- it probably wouldn't do much to slow down Internet gaming, anyway.

The Bush administration should back off.

 

[lots0]

I don't thing there is any doubt that we are witnessing one reason why Bush and his cronies have the lowest approval rating of any President in History.

The UGIEA law has so far cost US business untold Millions in lost business and forced Honest operators out of the US Market.

The UGIEA law has forced honest operators out the US Market, leaving US Citizens that want to gamble online in the hands of shady operators and criminals.

All this for what?

All in an effort to force unwanted religious mores down peoples throats...

I hope the NEW and Improved Justice Department under the new President will be more concerned about "JUSTICE" than what my personal mores are...

 

[maxd]

More on this from HuffPo:

WASHINGTON The Bush administration is moving in its last weeks to finalize regulations to enforce a controversial law that seeks to block Internet gambling. The move is drawing hot protests from Democratic lawmakers and supporters of online betting.

"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 committee's chairman, Rep. Barney Frank, D-Mass., wrote this week to Treasury Secretary Henry Paulson. ....

[continues at Link Removed ( Old/Invalid)

 

[lots0]

Sad News

From the Poker Players Alliance...

Dear Lots0,

I have unfortunate news to report. Despite the efforts of the poker community, the opposition of the banks and the recent news exposing inappropriate influence by the White House, today the current administration finalized the UIGEA regulations to be made effective on January 19th the day before president-elect Obama officially takes office. A copy of the final UIGEA regulations and the PPAs response can be found on our Web site.

I am sure that you share my outrage over this last-minute "midnight rulemaking," but I have not lost my drive to correct this injustice and I call on you to join me and the million strong PPA to help continue our fight. In fact, the Politico Newspaper reports on 11/12 that Congressional leaders are already plotting legislation for next year that will undermine the White House's "midnight" regulations. We must make sure that UIGEA is part of this regulation reversal.

There are 4 things you should do to respond to the government's actions:

1. Call your Member of Congress and let him or her know how disappointed you are by the lame duck administration's implementation of UIGEA and subsequent erosion of your personal freedom.

2. Send an email to the Obama Transition team and tell President-elect Obama that once in office he should immediately turn back the UIGEA and other "midnight rules" issued by President Bush.

3. Help the PPA help you. Become a Premium Member of PPA if you are not already. For only $20 you help us be effective advocates for poker and your membership put us in a strong position to defend your rights. If you are already a Premium PPA member please consider making an additional contribution to our fight.

4. Forward this to your friends and stay updated on the latest developments regarding the UIGEA regulations.

This is not the time to bow our heads in defeat; rather we must continue our efforts with renewed vigor. Thank you for your support and dedication to protecting the game we love.

Proud to play,
Alfonse D'Amato, Chairman
Poker Players Alliance

 

[jas2587]

From the Poker Players Alliance...

found this site for Pres. Obama, and there isa place for suggestions, idea's, and stories

His site:
Link Removed ( Old/Invalid)

He is taking some so these and going to change them when he takes office.
Link Removed ( Old/Invalid)
check it out.
Thanks LilJohn for the link


Cindy

 

[Casinomeister]

Don't forget this page:
Old URL

It needs updating from last week though.

 

[jetset]

Update

FULL SPEED AHEAD FOR UIGEA REGS (Update)

Implementation is January 19, 2009 with compliance by banks to start December 1st 2009.

Ignoring pleas from interested parties that included the chairman of the House Financial Services Committee, Treasury officials have rammed the supporting regulations for the Unlawful Internet Gambling Enforcement Act through regardless, setting January 19th - the day before the official departure of the Bush administration - as the implementation date.

The financial services industry, reluctantly pushed into enforcing the controversial regulations has until December 1st 2009 to comply with the requirement to halt all "illegal online gambling" financial transactions from players in the United States.

The 66 page rule, published mid-week by the Treasury, relies on financial institutions "performing due diligence" on corporate customers to ensure they're not processing online gambling transactions.

Although the regulations have still not delivered a clear and unambiguous definition of "illegal Internet gambling", a Treasury statement noted: "For purposes of the rule, unlawful Internet gambling generally would cover the making of a bet or wager that involves use of the Internet and that is unlawful under any applicable federal or state law in the jurisdiction where the bet or wager is initiated, received, or otherwise made."

Online players, internet freedom advocates, opposing politicians and the financial and banking industry itself have all criticised the regulations for a lack of precision, and there has been widespread condemnation of the additional burden it places on the US financial industry.

Nevada Representative Shelly Berkley, who has the support of the American Gaming Association in proposing an independent study of the Internet gambling phenomenon, commented: "The clock is ticking on President Bush's prohibitionist crusade against Internet gaming and that is clearly why these flawed regulations are being forced on the financial services industry at the very last minute."

Earlier this week, the chairman of the House Financial Services Committee, Rep. Barney Frank, D-Mass., had asked the Treasury not to move ahead with the regulations at this point, saying it would "burden the financial services industry at a time of economic crisis" and pointing out that a change of political administration that may have a different approach was imminent.

"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," Frank said.

The new regulation also failed to define unlawful Internet gambling, Frank said, "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."

Frank has tried to overturn the UIGEA with a proposal for a regulated US Internet gambling industry, which was narrowly defeated in committee. He has more recently attempted to force Treasury drafters into more clarity, an initiative which claims that the law did not offer a clear definition of Internet gambling, instead referring to existing federal and state laws, which themselves provoke differing interpretations.

Banks and other financial institutions have complained they are being forced into a law enforcement role when Congress could not even define what conduct it was trying to prevent.

But not everyone was disturbed by the abrupt publication of the regulation in the waning days of the Bush administration. Arch-online gambling opponent and Alabama Republican Representative Spencer Bachus welcomed the publication of the new regulations in a statement in which he said: "No longer will the offshore gambling interests benefit from anyone turning any computer into a casino that is available every minute of the day." Bachus has exerted considerable and prolonged political effort over the years to ensure that American players would not have the choice of gambling online.

The rule issued this week to implement the 2006 UIGEA requires "U.S. financial firms that participate in designated payment systems to establish and implement policies that are reasonably designed to prevent payments to businesses in connection with unlawful Internet gambling," the Treasury Department said in its statement.

According to the Treasury Department, during the public comment period of the proposed UIGEA rule, "about 20 commenters, almost all of them depository institutions, noted that notwithstanding the Agencies' efforts to craft a reasonable rule, the proposed regulation would be unduly burdensome and would result in compliance costs greater than any offsetting societal benefits.

"Several of these commenters stated that the rule would adversely affect the competitiveness of the U.S. payments system, and that the Agencies should be cognizant of the potential for the Act and similar laws to cumulatively cause capital flight and erode the U.S. dollar's status as the world's reserve currency."

The Treasury Department says the comments were taken into consideration, but says it believes "that flexible, risk-based due diligence procedures at account opening, such as those set out in the final rule, present the best option for balancing these two interests."

The UIGEA itself is currently being challenged in the US 3rd Circuit Court of Appeals on "void for vagueness" grounds, by iMEGA (Interactive Media Entertainment & Gaming Association).

 

[catrina m]

This seems to be a draft of the final one

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[catrina m]

Bush and his pals have did irrepairable damage to our country. They are just some really self serving ignorant assholes.

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[Mousey]

From the Kansas City Star...

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Federal regulations issued Wednesday to enforce a law passed two years ago by Congress aimed at outlawing internet gambling might achieve precisely the opposite effect.

Faithful to the broad strokes of the Unlawful Internet Gambling Enforcement Act of 2006, the Treasury departments controversial 121-page rule exempts intrastate cyber gambling that is authorized by sovereign states or tribes, and sanctions online wagering under federal interstate horse racing gambling laws.

The rules also exempt individual gamblers from enforcement, baring the governments regulatory teeth only at commercial gambling companies that ....

 

[Mousey]

From I. Nelson Rose:

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Copyright 2008, Professor I Nelson Rose, www.GamblingAndTheLaw.com.


It took 66 pages of fine print. But in the end the federal regulators charged with making regulations to enforce the Unlawful Internet Gambling Enforcement Act (UIGEA) simply gave up. They were supposed to make rules forcing financial institutions to identify and block money transfers for unlawful Internet gambling ...

 

[lots0]

WOW!!!
I am F*&&ing Flabbergasted...

I FRICKIN LOVE this part....

Anyone who uses paper checks, wire transfers, foreign bank credit cards, or overseas payment processors to load, reload or cash out can continue to do so.

Source:

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I. Nelson Rose is an acknowledged expert in online gaming laws.

I think I'm gonna party!

 

[lots0]

and then there is this...

What's really interesting.
The most interesting part of the new rule, for me, is that unlicensed Internet gaming operators can set up business relations with U.S. financial institutions, if the operators provide a reasoned legal opinion that it does not engage in restricted transactions. That means if I, as a licensed attorney and an expert on gaming law, give a legal opinion that a gambling operator is not violating federal or state laws, that should be good enough.

source:

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Again, I. Nelson Rose is an acknowledged expert in US online gaming law.

LMAO... Going to get totally f... up right now, in the middle of the day...
Xmas came early this year...


Added....
Before I get totally screwed up... here is a link to the actual set of rules if anyone wants to read it.

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[catrina m]

If its up to my bank to enforce it, its buisness as usual. They approve my debit card transactions and charge anywhere from .50 to $1 as an international service fee. The govt. wants them to stop getting this fee?

yeah right! Banks love fee's that aren't contested.

They also get $15 for a wire transfer.

Our govt' is a group of braindead, greedy, power hungry idiots.

 

[littlebit]

Cable news channels are also mentioning this article and applauding the official end of internet gambling for casinos. Somewhere the true story has to be out there you would think.

New Rules For Banks Target Online Gambling

By R. Jeffrey Smith
Washington Post Staff Writer
Thursday, November 13, 2008; Page A05

The Treasury Department and the Federal Reserve Bank yesterday issued new regulations spelling out how banks and other financial institutions must comply with a 2006 law that bans many forms of Internet gambling.

The regulations were released just a few days after critics of the law questioned the involvement of a former National Football League lobbyist in the White House's final review of the new rules.

Running 120 pages, the regulations detail how banks must identify and block illegal Internet gambling transactions beginning in January.

Companies involved in processing online payments have complained that the task will be difficult and costly.

Some Democratic lawmakers had proposed to regulate and tax Internet gambling instead, an approach opposed by the Bush administration and many congressional Republicans.

White House spokeswoman Dana Perino declined yesterday to explain why ethics officers had approved the participation of William Wichterman, a former lobbyist for the NFL, in the White House's final review of the regulations. Wichterman now works in the White House Office of Public Liaison.

Internet gambling officials and Rep. Stephen I. Cohen (D-Tenn.) had called Wichterman's involvement a conflict of interest, noting that the NFL had paid Wichterman and other lawyers millions of dollars in lobbying fees, in part to press for implementation of the gambling law.

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[jetset]

Update

iMEGA FILES LATEST RESPONSE (Update)

Representative body says new UIGEA regulations strengthen its case

The legal team at the Interactive Media Entertainment & Gaming Association (iMEGA) has filed their response brief with the US 3rd Circuit Court of Appeals, the latest step in their challenge to the constitutionality of the Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA). Their suit - iMEGA v. Keisler, et al - targets the US Department of Justice (DoJ), the Federal Reserve and the Federal Trade Commission, and seeks to have the law overturned on constitutional grounds by the appeals court.

The filing comes one day after the US Department of the Treasury and the Federal Reserve System published the final regulations for UIGEA, requiring all US banks, credit card companies and electronic payment processors to refuse all "unlawful Internet gambling" transactions.

"After reviewing the final regulations, we're extremely confident the court will look at this law and agree that UIGEA should be 'void for vagueness," said Joe Brennan Jr., chairman of iMEGA. "Regulators and Congress have refused to even define what 'unlawful internet gambling' is, and if you cannot even answer that basic question, how exactly are banks supposed to do it?"

The reply brief in in answer to an earlier brief submitted by the government, challenging the basis for iMEGA's suit. iMEGA's legal team answered the government's arguments point-by-point:

1. DoJ's claim that a "void for vagueness" argument against UIGEA was not raised by iMEGA at the trial court level is groundless, as it was addressed and preserved by the trial court and in Judge Mary J. Cooper's decision.

2. DoJ's claim that iMEGA lacks standing to raise privacy claims of individual Internet gamblers fails to recognize that iMEGA members may be prosecuted under UIGEA for permitting individuals to gamble on their Web sites

3. DoJ failed to refute the fact that UIGEA has no uniformity regarding "illegal gambling" in the states, and is therefore "void for vagueness"

4. DoJ are wrong when they deny gambling online in one's home - which is not a criminal activity - lacks constitutional privacy protection, even when such conduct is indeed private, consensual and legal under UIGEA.

The next step in this challenge will be for a three-judge panel to be selected by the court to review the briefs, and decide at what time the court would entertain oral arguments from both sides.

"For our part, we cannot wait for the opportunity to go before the 3rd Circuit," Brennan said. "We have a powerful argument that the government will find very hard to dispute. The sooner we can move this fatally flawed law off the books, the sooner we can turn our attention to working on technology solutions that will provide for a regulated online gaming industry in the US, while addressing the concerns for responsible gaming that critics have voiced."

 

[Snake Eyes]

Arch-online gambling opponent and Alabama Republican Representative Spencer Bachus welcomed the publication of the new regulations in a statement in which he said: "No longer will the offshore gambling interests benefit from anyone turning any computer into a casino that is available every minute of the day."

Ah, I'm so pleased to hear from this lunatic again...

 

[maxd]

Heard last night on MSNBC that the Bushies screwed up with their "midnight drop" deadline, something about it actually being quite easy for the incoming administration to overturn stuff that was rammed through at the last minute _if_ they have a majority in congress. Turns out the out-going guys need to table stuff months in advance or else it is subject to congressional review.

Not sure how this affects the UIGEA stuff but it might turn out to be a good thing.

 

[jetset]

It's a great story, but I haven't been able to unearth anything on it so far, Max - if you come across something further please post it.

 

[lots0]

Heard the same thing as Max.

Because of all the "Midnight Drops" (last minute Rules, intended to tie the hands of incoming president) by Bush and cronies the Democrats are planning on undoing all of them and the Democrats have found a law that lets them do this...

There is a building anger at the hundreds of these regulations that bush is pushing in his lame duck term, especially sense Bush specifically promised not to put new rules into effect after November 1.
Gee Bush lied again... who would have guessed...