6/4/10 – The Attorney General of Indiana, Greg Zoeller issued a statement as the week closed, claiming that attempts at federal level to licence online gambling in the United States will interfere with the ability of individual states to regulate the activity.
Zoeller addressed his thoughts to the U.S. House Ways and Means Committee, objecting to a measure that would allow online gambling sites to be licensed through the U.S. Department of Treasury.
The AG asserted that "…states should be free to decide for themselves whether to endorse online gaming at the state level."
The AG’s statement says that proposals before Congress (specifically Congressman Barney Frank’s HR 2267 and Rep. Jim McDermott’s HR 4976 companion bill) to loosen restrictions on Internet gambling by licensing online gaming operations through the federal government would tread on the state’s authority and send the wrong message.
“As attorney general, my job description requires me to defend the ability of our state to pass its own state laws and not have them nullified or preempted by the federal government,” Zoeller wrote.
“While serious objections to this legalization have been raised by those in professional sports, college athletics and other groups – who warn that licensing online gaming will open the floodgates to gambling addiction by youth and adults, ruined credit and the potential for corruption and organized crime – there are other valid reasons to be concerned about this legalization.”
The AG goes on to note that the [Frank] proposals would undercut a federal law Congress passed just four years ago: the Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA) that was supported by most state attorneys general and had created a complementary working relationship between state and federal gambling regulation.
That would change if the bills now before Congress passed in their current form, Zoeller claimed.
H.R. 2267 would allow states to opt out of extending Internet gambling; and it would attempt to impose safeguards against illegal conduct. But once Internet gambling operators obtained federal licenses, they would be shielded from prosecution or enforcement under state law.
Although promoted as potentially raising billions of dollars in revenue for the federal government, Zoeller says that the legalization has drawn the concerns of opponents, who counter that the optimistic revenue predictions hinge on state regulation of gambling being minimised.
“While I recognize that Congress considers various scenarios for plugging the deficit in the federal budget, our concern is that licensing and taxing Internet gambling in this way would circumvent and preempt the autonomy of state government,” Zoeller wrote.
“Rather than a one-size-fits-all federal approach, states should be free to decide for themselves whether to endorse online gaming at the state level and not have it forced upon them federally.”
Zoeller urges Congress not to pass the Frank bill, arguing that the current regulatory framework through the UIGEA and the Indiana Gaming Commission is sufficient for the present. He also appears unconvinced by Frank’s attempts to assuage sports integrity fears by keeping bans on internet sports betting intact, claiming that federal licensing on internet poker and casino will ultimately erode restrictions on sports betting.
The US national sports leagues continue to vehemently oppose online gambling regulation and licensing.