Net Gambling Bill Seen as Risky

Net Gambling Bill Seen as Risky

WASHINGTON — Clinton administration officials challenged a Republican anti-gambling bill on Tuesday, saying it could slow the future growth of the Internet.

“Any prohibitions affecting Internet communications must be carefully drafted to accomplish the legislation’s objectives without stifling the growth of the Internet or chilling its use as a communication medium for protected speech,” said Kevin DiGregory, deputy assistant attorney general.

DiGregory told the House Banking Committee that any legislation should be “technologically neutral,” and that a plan members were considering would impose more restrictions on the Internet than currently apply in meatspace.

“I can’t believe that the administration is sitting back and letting things drift, dangerously,” said Representative Marge Roukema (R-New Jersey). “You’re in denial about that.”

Roukema criticized the White House for taking aim at congressional attempts at regulation without introducing a plan of its own.

The bill, H.R. 4419, follows a related measure that the House Judiciary Committee approved this spring and forwarded to the House Commerce Committee, which must act no later than June 23.

The second bill, H.R. 3125, was designed to outlaw many forms of Internet 789bet gambling. But lobbyists for special interests intervened, and horse racing, jai alai, casinos, and other activities won exemptions.

That bill was broader, and targeted individuals who “engaged in a gambling business knowingly to use the Internet or any other interactive computer service to place, receive, or otherwise make a bet or wager or to send, receive, or invite information assisting in the placing of a bet or wager.”

“I want to see that (H.R. 4419) doesn’t get lost along the way like (H.R.) 3125,” said Representative Jim Leach (R-Iowa), chair of the House Banking Committee.

One difference is that the banking bill aims to encourage other countries to follow the lead from the U.S. “If you don’t have enforcement mechanisms, you don’t have legislation,” Roukema said.

Other language in the bill authorizes the Treasury Department and the Federal Reserve to take “appropriate” action against financial institutions viewed as funneling payments to or from offshore gambling sites, such as those in the Caribbean. One typical offshore company, Elka Enterprises, specializes in providing offshore websites in Costa Rica and the Bahamas.

The GOP leadership said the bill was targeted at large, reputable banks that offshore gaming sites must use to make and receive payments.

“(It) is not so much a bill that aims to catch someone in the act so much as it’s aimed at being able to recognize those who are in violation and bring a case against them,” said Representative Ken Bentsen (D-Texas).

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