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D.C. Think Tank Berates UIGEA, Calls for Its Repeal in 'White Paper'

by PokerPages.com
Tue, Apr 1st, 2008 @ 12:00am

With the Congressional hearing on the Unlawful Internet Gambling Enforcement Act (UIGEA) scheduled for April 2, the Competitive Enterprise Institute, a conservative Washington D.C. think tank, has come out very strongly against the use of financial institutions to cripple online poker and online gambling in the United States, recommending that the "harmful" law be repealed.

The UIGEA has been repeatedly criticized for its unclear regulations and the resulting impracticality of its implementation.

Following a study of the implications of requiring the US financial industry to police unclear government enforcement policy on Internet gambling, the Institute warns that implementing the UIGEA could cause damage far beyond its original online gambling target.

"The Act seems unlikely to stop Internet gambling and could even threaten the stable, smooth operation of America's banking system," Senior Fellow Eli Lehrer says the opening paragraph of the white paper he authored entitled "Time to Fold the Unlawful Internet Gambling Enforcement Act: A Bad Law with Perverse Outcomes."

"UIGEA and its currently proposed enabling regulations will undermine the financial privacy of all Americans and reduce the security of their bank accounts. In short, it makes almost no financial, social, or economic sense," he adds in his opening remarks.

The paper is divided into three sections. The first section gives an overview of UIGEA's provisions and the regulations proposed to implement them. The second "describes the law's likely and perverse consequences", and the paper's conclusion "outlines some principles for reforming or eliminating this harmful law".

For the entire original white paper, available on the Poker Players Alliance web site, click here.

For a summary of the paper, titled "No Dice" which was also authored by Eli Lehrer and Michelle Minton, a Policy Analyst at the Competitive Enterprise Institute, and published by American Spectator this week, click here.

More members of Congress are becoming aware of the problems with the gambling ban.

On April 2nd, the House Committee on Financial Services is scheduled to hold a hearing titled "Proposed UIGEA Regulations: Burden without Benefit?" to detail what has gone wrong with its implementation and how to fix it (hopefully they will see fit to ban the ban). The hearing will be overseen by Rep. Luis Gutierrez (D-IL).

"Even before it considers proposals for the regulation of online gambling, Congress should consider an outright repeal of the Unlawful Internet Gambling Enforcement Act," said Lehrer. "The law has very little to do with gambling and serves as a poorly thought-out banking regulation fraught with potentially perverse incentives. Quite simply, it is a bad law. Repealing it makes sense."

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