Two U.S. federal threats to online gambling

The introduction of two bills seeking a federal ban on all online gambling – including online poker – is reportedly imminent, with Utah Representative Jason Chaffetz set to follow the earlier announced initiative (see previous reports) of Senator Lindsey Graham of South Carolina.

The Washington DC publication Politico reports that Graham, who announced his intention to launch a banning bill with exemptions for horse racing and fantasy sports earlier this month, has received campaign donations from arch online gambling opponent and land casino baron, Sheldon Adelson.

Graham is expected to introduce his banning bill as soon as next week, according to sources working on the issue.

A draft of Graham’s bill has apparently been circulating among selected Congressmen, although a member of Sen. Graham’s staff told Politico that there were no immediate plans to unveil the bill.

Senate Minority Leader Mitch McConnell would likely oppose any legislation that included horse racing, which is a key industry in his home state of Kentucky, Politico points out.

A more recent threat has emerged in the person of the Republican Representative from Utah, Jason Chaffetz, this week.

Politico and other well-informed publications report that his staff have revealed he is preparing to introduce a sister bill to Graham’s next week.

Chaffetz’s home state bans all forms of gambling and the congressman has not received any large contributions from Adelson in recent years, according to a search of campaign finance records.

The Adelson’s anti-online gambling jihad point men in the Coalition to Stop Internet Gambling applauded the Graham and Chaffetz moves, saying:

“We support and applaud all efforts to restore the long-standing interpretation that the Wire Act prohibits Internet gambling. It’s common sense that putting a virtual casino in the pocket of every American with a phone is bad public policy.”

The opposing view was put forward by the Coalition for Consumer and Online Protection, which believes that regressing to such a ban would put consumers at risk and violate states’ rights.

“Banning all online gaming nationwide, as this bill effectively does, would put American consumers at serious risk,” said coalition spokeswoman and former Rep. Mary Bono in a statement. “It is impossible to stand in the way of the Internet; instead, we should embrace and shape these new technologies in a way that is safe for consumers.”

Chaffetz’s ambition is to reinstate the Wire Act but with more certainty in its ban on internet gambling generally, rather than simply for sports betting.

A Chaffetz spokesperson said this week:

“For 50 years the Wire Act was interpreted one way, and then two days before Christmas 2011, the DOJ decides to change that interpretation. The [Chaffetz] bill would restore the original interpretation of the Wire Act pre-December 2011, the one that was issued by the DOJ.”

She added that on the issue of internet gambling there were strong views on both sides. “If we’re going to allow Internet gambling in this country, it needs to go through Congress,” she said.

The timing for both bills appears to coincide with the reconvening of Congress next week.