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The U.S. House of Representatives on June 10 approved legislation to prohibit the use of financial instruments, such as credit cards, in any transaction involving offshore illegal Internet gambling. The Unlawful Internet Gambling Funding Prohibition Act (H.R. 2143) passed by a vote of 319 to 104. The House defeated (186 to 237) an amendment to remove an exemption in the bill for “any lawful transaction with a business licensed or authorized by a state,” offered by House Judiciary Chairman F. James Sensenbrenner Jr. (R-Wis.). Supporters said removing the exemption would kill the bill, since it is necessary to keep gambling interests such as horse racing groups from opposing it. “If the language regarding State license domestic wagering were eliminated or changed, this legislation simply would not prohibit credit in connection with Internet gambling, it would restrict the day-to-day wagering activities of millions of horse racing fans by limiting financial clearing transactions with domestic wagering facilities,” said Rep. Harold Rogers (R-Ky.). Opponents said the exemption might expand U.S.-based Internet gambling. “Internet gambling should be eliminated; but to have a carve-out for horses and dogs and lotteries and jai alai, and Lord knows what else, means that people will be able to use the Internet and use their credit cards to place bets and lose a lot of money,” said Sensenbrenner. In contrast, Rep. Barney Frank, D-Mass., who believes individuals should be permitted to gamble, asked, “If an individual has gone out and earned his or her money and decides he or she wants to gamble, why in the world is it anybody in this building’s business?” Internet gambling is illegal under federal law and in all 50 states. Since most of the estimated 2,000 Internet gambling sites operate from offshore locations, they are effectively beyond the reach of U.S. regulators and law enforcement, as well as the statutory anti-money laundering regimes that apply to U.S.-based casinos, according to a GOP summary of the bill. These “virtual casinos” advertise the ease of opening betting accounts mainly through the use of credit cards and alternative payment systems, the summary revealed. Internet gambling sites not only are vulnerable to criminal exploitation by money launderers, but they can easily abuse a customer’s credit card information or manipulate the odds of a particular wager to the casino’s advantage, according to the GOP explanation. In addition to legal and economic challenges, problem gambling — including problem Internet gambling — can lead to personal and family hardships, such as lost savings, excessive debt, bankruptcy, foreclosed mortgages and divorce. In particular, Internet gambling is proving to be a serious problem for many college students, GOP summary asserted. The House measure is similar to a Senate bill, S. 627, by the same name. � 2003, CCH INCORPORATED. All Rights Reserved.

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