On Friday, April 16th, the House Financial Services Committee will hold a hearing focusing on two internet gambling bills proposed by Congressman Barney Frank (D-MA). No markup of either bill is planned.
Two pieces of legislation, both introduced by Frank in May, seek to alter the current state of the internet gambling industry under the Unlawful Internet Gambling Enforcement Act (UIGEA): the Reasonable Prudence in Regulation Act (HR 2266) and Internet Gambling Regulation, Consumer Protection, and Enforcement Act of 2009 (HR 2267). The former mandates a one-year extension in industry compliance with the regulations of the UIGEA, while the latter outlines a full framework for licensing and regulating the industry in the United States.
Breaking the news early Saturday morning was the Safe and Secure Internet Gambling Initiative. Organization spokesperson Michael Waxman commented in a press release, “This hearing will provide further evidence that UIGEA is a poorly-crafted law that simply does not work. A more common sense approach to protect Americans is required. We expect this hearing to provide further impetus for the House Financial Services Committee and Congress to address this issue and move forward Chairman Frank’s regulatory bill.” The UIGEA was passed in the waning moments of the 2006 Congressional session after being attached to the SAFE Port Act, an unrelated port security measure. Four years later, its regulations are not fully enforced.
In November, the financial services industry received a six-month reprieve in compliance with the UIGEA rules to June 1st. Now, that deadline is just two months away. Although industry insiders widely expect little to change once the deadline comes and goes, its passing is an event the Poker Players Alliance (PPA) wishes to avoid entirely. The PPA, which had not commented on the hearing at press time, has been supportive of the efforts by Frank on Capitol Hill. In part through the PPA’s initiatives, HR 2267 is up to 66 co-sponsors on both sides of the aisle, while HR 2266 boasts 55.
The text of HR 2266 states that the deadline for industry compliance would be delayed until December 1st. Newly introduced in the House is HR 4976, the most recent installment of the Internet Gambling Regulation and Tax Enforcement Act. The bill, introduced by Congressman Jim McDermott (D-WA), taxes licensed internet gambling operators at a federal rate of 2% and a state rate of 6%. It also mandates that a portion of federal funds raised would be directed to those currently or formerly in foster care as well as historic preservation projects and the arts. HR 4976 has just three co-sponsors after being unveiled on March 25th.
The hearing will be held in Room 2128 of the Rayburn House Office Building and begin at 10:00am ET. A live webcast can be found on the official website of the House Financial Services Committee. The discussion will focus on “governmental perspectives” and follows a separate hearing that took place in December. Then, Congressman Spencer Bachus (R-AL), the Ranking Member of the Financial Services Committee, questioned why no representatives from the Federal Reserve or U.S. Treasury, which had issued the six-month delay, were present to testify. Friday’s hearing is expected to feature members of both government entities.
No witnesses were available at press time and Waxman told Poker News Daily that no markup will take place. On Wednesday, two days prior to the hearing, the PPA will be hosting a charity poker tournament benefiting Ante Up for Africa. McDermott and Senator Robert Menendez (R-NJ) are penciled in for the event, along with Ante Up for Africa co-founder Annie Duke, Full Tilt Poker pros Howard Lederer and Andy Bloch, and 2004 World Series of Poker (WSOP) Main Event champ Greg Raymer. Lederer is purportedly the subject of a grand jury investigation of Full Tilt Poker.
Stay tuned to Poker News Daily for the latest developments on this important hearing.