Unlawful Internet Gambling Enforcement Act of 2006

The Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA) is a U.S. law which was approved in late 2006. It was added to the Security and Accountability For Every Port Act of 2006 via conference committee and was signed by President Bush on October 13, 2006. The Act prohibits the transfer of funds from a financial institution to an Internet gambling site, with the notable exceptions of "fantasy" sports, online lotteries, and horse/harness racing.

Debate and passage
The UIGEA became law despite never being debated on by the Senate. It passed the House on July 11, 2006 by a 317-93 vote but was not taken up by the Senate. During a conference committee to iron out the differences between the House and Senate's version of the Security and Accountability For Every Port Act of 2006 the UIGEA was added to that bill, which was then approved in up-or-down votes by both chambers of Congress. The House version of the UIGEA was cosponsored by Reps. Bob Goodlatte (R-Va.) and Jim Leach (R-Iowa).

Provisions
The UIGEA was aimed at defining and restricting certain aspects of interstate online gambling. Legislatively, it amended the Federal Wire Act. In doing so, it reinforced that financial institutions would be held both criminally and civilly liable for processing related transactions. The Act specifically prohibited people from making a "bet or wager" on events that rely on "outcome of a contest of others" including:


 * Dog racing
 * Lottery participation
 * Gambling on athletic events

The bill exempted:


 * Horse racing
 * Securities transactions
 * Commodities transactions
 * Over-the-counter derivative instruments
 * Indemnity or guarantee contracts
 * Insurance contracts
 * Bank transactions (transactions with insured depository institutions)
 * Games or contests in which the participants to do not risk anything but their efforts
 * Certain fantasy sports contests.

Enforcement
Since passage of the bill, there have been many warrants issued for companies as well as individuals both foreign and domestic. The "State of Louisiana had canceled all outstanding arrest warrants issued against current or former employees, including ex-CEO Peter Dic".

Bill to overturn 2006 Act
In April 2007, Rep. Barney Frank (D-Mass.) introduced a bill, (H.R.2046) overturning the Act, stating "The existing legislation is an inappropriate interference on the personal freedom of Americans and this interference should be undone." Additionally, the bill sets up the framework for taxing and regulating online gambling by individuals within the United States.



Sponsors

As of May 1, 2007, the bill had collected the following cosponsors:


 * Rep. Gary Ackerman (D-N.Y)
 * Rep. Shelley Berkley (D-Nev.)
 * Rep. Michael Capuano (D-Mass.)
 * Rep. Julia Carson (D-Ind.)
 * Rep. William Clay (D-Mo.)
 * Rep. Luis Gutierrez (D-Ill.)
 * Rep. Steve Israel (D-N.Y.)
 * Rep. Peter King (R-N.Y.)
 * Rep. Ron Paul (R-Texas)
 * Rep. Melvin Watt (D-N.C.)
 * Rep. Robert Wexler (D-Fla.)

Support and opposition
On May 1, 2007, Roll Call reported a story in which lobbyist Martin Gold, who works for Covington & Burlington, sent Frank an e-mail stating, "Our sports organizations would very strongly oppose any effort to legalize any online sports gambling." Among the five major sports organizations that his firm represents are the National Football League (NFL), National Basketball Association and Major League Baseball (MLB).

In a World Trade Organization dispute between Antigua and the United States, the WTO ruled on January 25, 2007 that the U.S. is in violation of its treaty obligations by not granting full market access to online gambling companies based in the island nation.

On March 30 the WTO confirmed the U.S. loss in the case.

Previous legislation
A prior version of the gambling bill passed the House in 1999, but failed in the Senate in part due to the influence of lobbyist Jack Abramoff.

External resources

 * Open Congress 110th Congress H.R.2046, Repeal of the UIGEA
 * I. Nelson Rose, "The Unlawful Internet Gambling Enforcement Act of 2006 Analyzed", Gambling and the Law.
 * igaminglaw, Posts filed under US legislation
 * Michael Bluejay, "Legal issues with online gambling in the U.S.", gamblingads.com, January 2007.
 * Michael Bluejay, "Is it legal for websites to advertise online gambling?", gamblingads.com, October 2006.

External articles

 * MSNBC.com: Will ban end Internet gambling? Don't bet on it