Experts to Testify in U.S. Online Gaming Hearing Thursday

3rd December 2009 9:35 am GMT

The House Financial Services Committee will today discuss Chairman Barney Frank's legislation which seeks to legalise and regulate Internet gambling in the United States. The hearing, scheduled to begin at 10:00am (EST), will consider expert testimony from a number of witnesses both for and against the implementation of the legislation.

Following on from the recent decision by the Department of Treasury and the Federal Reserve to delay compliance with UIGEA by six months to June 1st 2010, the hearing further sets the stage for Congress to vote on legislation introduced by Chairman Frank to regulate the industry.

Leaders in the fields of online security and consumer safety as well as current licensed U.S operators will present testimony at the hearing today including Robert Martin, Tribal Chairman of the Morongo Band of Mission Indians, Ms. Parry Aftab, Executive Director of Internet safety and help group WiredSafety, and Youbet.com's Executive Chairman, Michael Brodsky.

In his testimony, Mr Martin will state his opposition to Rep. Frank's bills H.R 2266 and 2267, questioning why Congress wants to protect "foreign illegal gambling operators" to the detriment of existing American jobs.

Mr Martin will argue that the legislation will do nothing but legalise off-shore gaming at the expense of American jobs and leave tribes at a competitive disadvantage since they are restricted to offer gaming only from Indian lands. He will say that the UIGEA provides a constructive pathway for those who wish to offer Internet gaming on a state-by-state basis and that the law should be given time to become effective in its own right.

Mr. Martin' views should be seen in light of recent attempts by his Morongo Band of Mission Indians to introduce an online poker bill in California giving them the exclusive right to offer poker online, a bill which the Band ultimately withdrew in the face of stiff opposition from rival tribes and Californians in general. (more).

Ms. Aftab of WiredSafety will state in her testimony that the best way to protect families and consumers from online gambling is by legalising it, not outlawing it completely. She will state that current laws to prohibit the use of any financial institution for placing illegal bets online won't work in isolation nor in a digital environment. In her conclusion she states that the best way to address the risks associated with online gambling is to develop a strong regulatory regime that protects consumers and empowers parents to protect their children from risky gambling sites.

Mr Brodsky will also use his testimony to support legalised Internet gambling, comparing the passage of the UIGEA to attempts to ban alcohol via prohibition in the early 20th century. He will argue that the vast majority of people who gamble online are law-abiding citizens who want to wager on a system that has integrity and security, which can only be achieved by legalising and regulating the activity.

The hearing will also hear testimony from Professor Malcolm K Sparrow of John F Kennedy School of Government, Harvard University, Keith S Whyte, Executive Director of the National Council on Problem Gambling, Jim Dowling of Dowling Advisory Group, and Samuel A Vallandingham, CIO and VP of the First State Bank on behalf of the Independent Community Bankers of America.

"This hearing will provide further evidence on the ability to effectively regulate Internet gambling and require licensed operators to utilize already-proven technologies to protect consumers," said Michael Waxman, spokesperson for the Safe and Secure Internet Gambling Initiative. "It's expected this hearing will answer any outstanding questions and pave the way for a vote in the committee on Chairman Frank's legislation."

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