Congressmen Barney Frank and Ron Paul have introduced new legislation in the United States to prohibit the Department of the Treasury and Federal Reserve System from proposing or implementing regulations that would enforce the Unlawful Internet Gambling Enforcement Act (UIGEA).
Earlier this month, the House of Representatives Subcommittee on Domestic and International Monetary Policy, Trade and Technology, heard expert testimony from the US Treasury, Federal Reserve, as well as numerous industry bodies including the American Bankers Association and the Financial Services Roundtable, all of whom criticized the proposed rules as unenforceable.
The legislation proposed last week by Congressmen Frank and Paul, HR5767, would „prohibit the Secretary of the Treasury and the Board of Governors of the Federal Reserve System from proposing, prescribing or implementing any regulation under subchapter IV of chapter 53 of title 31, United States Code, and for other purposes“.
„The Frank-Paul bill would stop the US government from taking any further steps on regulations that would require the country’s financial institutions to block Internet Gambling payments,“ said Jeff Sandman, spokesman for the Safe and Secure Internet Gambling Initiative. „It’s a bold move, but a necessary one, in light of the warnings from the Treasury and Federal Reserve that they did not know how to write regulations to solve the problems created by UIGEA.“
The current Internet gambling ban creates significant additional burdens for US financial institutions, which say that it is unfair to turn them into the Internet gambling police at a time when their undivided attention should be on the economy.
„With the current mortgage crisis and other economic pressures, we hope that Congress will reconsider whether this is an appropriate time to ask us to dedicate resources to try to comply with what we view as an unworkable law,“ said Harriet May of Credit Union National Association in her testimony before Congress.
Representatives from the Financial Services Roundtable, American Bankers Association and Wells Fargo & Co. also testified about the unnecessary burden that they would face under the proposed rules, and also highlighted the ambiguity of the law, which allows for multiple interpretations of what may or may not be illegal activities. Their comments reflected the concerns echoed in the more than 200 comments submitted to the Department of the Treasury and Federal Reserve System.