US Senate Calls for Online Gambling Regulations

Unregulated gambling could assist terrorists, drug dealers, human traffickers and other organized crime elements to launder money, a bipartisan group of senators agreed at a subcommittee hearing last week.

"US Behind Eight-ball"

"What we have here is a free-for-all," Senator Kelly Ayotte (R-NH) said at the hearing of the Senate's Commerce, Science and Transportation subcommittee hearing, the first meeting on the topic of online gambling since the states of Nevada, New Jersey and Delaware approved Internet gambling bills.

A number of Democrat senators agreed with their Republican counterpart's contention that the federal government's failure to regulate online gambling encourages "money laundering, terrorism and drug trafficking." Sen. Richard Blumenthal (D-Conn.) was one of them, arguing that human traffickers and pornographers take advantage of legal uncertainties to shift money around through online casinos.

Among those who argued for federal regulation were Fraternal Order of Police National President Chuck Canterbury and Washington attorney Jack Blum. Canterbury told the committee that "we're always behind the eight-ball on technology", adding: "local law enforcement won't be able to attack money laundering and terrorist activity with 50 separate state laws."

Gambling Industry Applauds Senators

 The American Gaming Association applauded the Senate for bringing attention to the importance of effective regulation of online gambling. It said in a press release that reports suggest an "alarming number" of Americans spend billions of dollars annually on illegal Internet gambling made possible by foreign companies that fail to verify age and offer basic consumer protections.

"Internet poker is a reality that is here to stay," said Geoff Freeman, president and CEO of the American Gaming Association.  "The question is whether Congress will ensure minimum regulatory standards of online poker, protect consumers, exclude bad actors from the American market and provide Native American tribes with an appropriate regulatory framework."

Regulation on the Horizon

Senate Majority Leader Harry Reid (D-Nev.) and Sen. Dean Heller (R-Nev.) have said they may introduce new legislation on online gambling this year.

Reid and Sen. Jon Kyl (R-Ariz.) drafted a bill last year to amend the Wire Act by regulating poker at a federal level and banning most other forms of online gambling. However, that bill was never introduced, and was criticized heavily by state lottery officials who feared that they wouldn't be able to sell their games over the Internet.