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Hello, I'm David, and I'm an Internet Gambler:

I know there are more important things going on in the world, but the Internet Gambling Enforcement Act of 2006, recently signed into law, really has me steamed. And not only because it has caused one (but, fortunately, only one) of my internet gambling sites to close out my account.
There are many grounds upon which one might say that particular laws are "bad," and this one seems to have all of them in one package. Let's see, where to begin? ...
First, it will not work. It is already not that difficult to evade the law's restrictions — if you get some form of e-cash, you can transfer that to and from offshore gambling sites without restriction. It's not all that easy now to do that — but I guarantee you that it will be a whole lot easier a year or two down the road. Duh.
I'd gladly stake $100 on the following proposition:

"The total dollar volume of online offshore gambling originating in the U.S. will be substantially greater in 2011 than it is in 2006."
If there's anybody out there silly enough to want to take me up on that and to $100 on the other side, let me know.
Second, it perpetuates a truly insidious form of State regulation that would be laughable if it were not so nasty. There's a very good reason that Jack Abramoff's client list consisted primarily of people in the gambling business — there are prodigious opportunities for monopoly rent-seeking in the current regulatory scheme. Like: get yourself designated an Indian tribe, and you're on your way to riches. Third: to the extent that there really are people for whom gambling is a real addiction that is destroying their lives, this will insure that they go underground (see point 1) and find ways (which will be readily at hand) to gamble in untraceable ways.
Fourth: It is incomprehensible gibberish. Take a look at the law and try to read it and understand it. Really. This is your law, after all (at least, for those of you logging in from the US). Yet I suspect that there isn't one person in a thousand who could make sense of this document in a reasonable period of time. What does it mean? When law becomes incomprehensible to those supposedly subject to it, it ceases to be law anymore, at least in my book ...
Fifth: It discriminates, in a rather nasty way, against the poor — it doesn't stop anyone from going to Las Vegas to do all the gambling they wish, but if they want to do that without the expense of traveling, no go. Sixth: It is protectionist (and quite probably a violation of our international obligations under the GATT) — the whole purpose is to disadvantage overseas businesses and advantage domestic providers.
Seventh: it is unconstitutional. Well, I'm not so sure about this one, I admit. But here's my argument: it would clearly be an abridgement of my constitutional right to travel for Congress to pass a statute prohibiting me from going to the UK and participating in (legal) gambling while I was there. The Act, in practical effect, does the same thing. I know it's not really "travel" when one "goes" to an offshore website. But the rationale behind the constitutional right, it seems to me, is as applicable here as in the "physical travel" realm.

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More on Internet Gambling:

I gather that my argument about the unconstitutionality of the Internet Gambling Enforcement Act (which Tom Bell has nicely dubbed the UnInGen-ious Act")is not passing the Volokh Conspiracy hoo-ha test ... Sigh.
But here's another thought. The law, oddly enough, does not make it unlawful to engage in gambling over the Internet. (Of course, it's not really so odd -- if Congress actually passed such a law, and they started fining or throwing in jail individuals who use the Internet to gamble,they'd have a lot of very, very pissed off constituents on their hands.)
Instead, it prohibits anyone "engaged in the business of betting or wagering" from knowingly accepting payment "in connection with the participation of another person in unlawful Internet gambling." (ยง 5363). And it requires the Federal Reserve to promulgate regulations requiring banks, credit-card companies, and other financial institutions to "identify and block or otherwise prevent or prohibit restricted transactions," i.e. those involving "unlawful Internet gambling."
But -- and this is the interesting part -- the Act doesn't itself make any Internet gambling "unlawful." It defines "unlawful Internet gambling" as "knowingly transmitting a bet or wager" using the Internet "where such bet or wager is unlawful under any applicable Federal or State law."
In other words, the act of placing the bet has to be unlawful under some other Federal or State law for it to be covered by this Act.
No provision of Federal law, at present, makes it unlawful to place a wager at an Internet gambling site. So what gives this statute teeth are the provisions of State law that do so. NOTICE TO STATE LEGISLATURES: Would you like to have about $20 billion or so directed towards financial institutions in your State? It's easy! Here's what you do: Permit Internet gambling. Say that Vermont passes a law saying that it is legal to gamble over the Internet. I could then open up a bank account in Vermont; when the offshore gambling site gets my inquiry to set up an account, I can transfer money from my Vermont account -- not illegal! -- to the gambling site, and vice versa.

Related Posts (on one page):

  1. More on Internet Gambling:
  2. Hello, I'm David, and I'm an Internet Gambler:
17 Comments