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Online Gambling in the United States Allowed Soon? New Legislation Introduced

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After years of struggling with prohibitionist laws, online gambling may finally be legal and regulated in the United States. Representative Barney Frank (D-MA) has introduced legislation to license casino and poker room operators in the United States.

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The news comes as no suprise to many. Representative Frank has been an outspoken critic of the Unlawful Internet Gambling Enforcement Act (PDF), which criminalized financial transactions to offshore casinos and poker rooms. "My fundamental reasons for doing this are that the government should not interfere with people's liberty unless there is a good reason," Frank said at a press conference on Tuesday. He also said "I don't understand why this principle that an individual should be free to make their own choices does not apply to individual adults to gamble with their own money." (Source)

The bill, called the Internet Gambling Regulation, Consumer Protection, and Enforcement Act of 2009 (PDF), or just H.R. 2267, has 15 cosponsors. The bill is intended to serve as a foundation for a serious overhaul of federal gambling policy. It includes guidelines for the distribution of licenses, mandates for consumer protections against fraud, underage gambling and money laundering.

If passed the bill could be a boon for cash-strapped states looking for revenue. A recent study estimates that online gambling could generate billions in much needed tax dollars over the next decade. No new tax rates are included in the bill but future tax options are possible. States will be permitted to make their own decisions on whether or not to allow online gambling and how to structure any taxes.

It is likely the bill will face several revisions as it moves through the ranks. Of interest to poker players is a clause which bans the use of so called "electronic cheating devices" such as poker bots. The penalty for using such programs to gain an advantage could be punishable by a fine or up to 5 years in prison or both. Although poker tracking software such as PokerTracker could conceivably fall under the scope of anti-cheating provisions the bill specifies that this only applies if the advantage gained is prohibited under the rules of the poker room or casino. In other words, each poker room may have its own rules regarding poker tracking software. Perhaps some rooms will allow the programs and some will not.

The next few months will be very important for this bill. Frank has indicated he wishes to push this legislation through his committee before congress recesses in august. The bill does not legalize online sports betting and as such should not draw such fierce opposition from professional sports organizations as previous bills. Poker players would be wise to contact their representatives and tell them to support H.R. 2267. We've been waiting for years for a chance to legalize online poker.

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