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The chairman of the House Financial Services Committee, Democrat Congressman Barney Frank, said this week that the recent seizure of millions of dollars in online poker payments (see previous InfoPowa reports) only strengthens his hand because it reminds voters and politicians how sweeping - and potentially unclear - the existing law is.
Speaking to the Washington DC publication Politico, Franks said the action by the U.S. attorney for the Southern District of New York in which $34 million in processor accounts - payments to an estimated 27 000 US poker players - could be helpful in getting his HR2267 bill passed, legalising and regulating online gambling in the United States.
Politico reports that even online gambling's chief opponent, the Republican Representative from Alabama, Spencer Bachus, believes Frank is holding much better cards in the current Congress than he had in the last one.
The publication quotes Bachus as saying: “It’s going to be an uphill battle to stop it this time. We caught them off guard last time. This time, they won’t be off guard.”
Frank introduced legislation last month that would create a licensing and regulatory framework that would allow Americans to play poker and place other bets on government-approved websites - a move that has the potential to generate billions of dollars in much-needed revenues for individual states or the federal government.
Politico goes into some detail on the machinations of Arizona Republican Senator Jon Kyl and the then Senate Majority Leader Bill Frist - a Tennessee Republican - in getting the ban on Internet gambling financial transactions through Congress back in 2006.
The duo managed this by choosing a late night session on the cusp of a congressional recess, ramming the Unlawful Internet Gambling Enforcement Act through attached to a totally unrelated but "must pass" port security bill. Before that there was a long history of political manouevring by those for and against online gambling in trying to ban the pastime - or prevent it being banned.
Ever since the UIGEA passed into law, costing overseas online gambling companies billions in lost business and stock declines, the controversial act and its difficult enforcement has been the subject of political action and public debate.
Politico comments that online gambling has been good for Washington lobbyists, with many millions paid to lobbying firms, and to campaign funds, by both sides.
The publication also points to the National Football League, which helped turn key Democrats against Frank’s bill last year to give the chairman a surprise defeat in a vote on his own panel. But now Spencer Bachus and other supporters of the online gambling ban fear the league may be working with Frank on a compromise that would uphold laws against sports betting whilst liberalising other forms of online gambling.
The recent bank seizures by the New York authorities are the latest developments in the long-running online gambling legalisation saga.
"The....seizures, which targeted accounts managed by two companies that process payments for online poker sites such as Poker Stars and Full Tilt Poker thrust the issue back into the news and renewed old questions about the clarity of the existing law," reports Politico, revealing that Frank described the move as "a terrible idea" last week.
Nevada Republican Representative Shelley Berkely seems to agree with the Financial Services Committee chairman; her staff is drafting a formal response to the administration, arguing that the seizure “shows the inappropriate excess of government power.”
“People have a right to play poker in their homes,” Shelley contends, “and the federal government doesn’t have a right to enforce against that.”
A spokesman for the Financial Services Committee told Politico that the panel needs to hold a hearing on the chairman’s bill before lawmakers would ever consider formal legislation. And the committee has its hands full this summer rewriting the regulatory infrastructure for the country’s huge financial services industry.
"But Frank likes his odds coming out of the flop," Politico reports, quoting the politician as saying: “We’ll get it done.”
Since the appearance of the Politico article four more co-sponsors have signed on for Congressman Frank's legislation. The latest signings include California Representative Michael M. Honda; Representative Ed Perimutter from Colorado; Texas Representative Ciro D. Rodriguez and New Jersey Representative Robert E. Andrews.

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