American Bankers Association Speak Up Against the UIGEA

As more groups begin to analyze and sound off on the effects of the Unlawful Internet Gambling Enforcement Act of 2006 officials at the Treasury Department and the Federal Reserve found that out after sifting through more than 200 comments from banks, gamblers, church groups and members of Congress on recommendations for the UIGEA, the basic sentiment was that financial institution enforcement, will not work.

“If the federal agencies themselves cannot agree on the law, what hope is there that banks can resolve these confounding legal issues?” the American Bankers Association said in commenting on a conflict between the Treasury and Justice departments on the legality of betting on horses.

The Washington trade group said the suggested rules are more likely to catch its members in a compliance trap than stop profits from illegal gambling from escaping offshore.

writes Cindy Skrzycki in her column Internet Gaming Rules Face Long Odds.

In addition to the brewing sentiment by the payment processors over the hardship that UIGEA places on them, a recently released study by Price Waterhouse Coopers identified how much money can be made from legalized online wagering in the U.S. was analyzed by http://majorwager.com

According to the findings the U.S. could stand to make a minimum of $3.1 billion in revenues in the first 5 years of legalization and up to $8.7 billion in the first 10 years, if they went with the least of the proposals, i.e. Barney Frank’s bill with the sports opt out. The study takes in to account that the 10 states that currently make internet gambling illegal will continue to do so. Price Waterhouse Coopers also suggested that if they were to adopt Jim McDermott’s bill with a sports wagering opt out, the amount of revenues could go up to $17.6 billion in the first 10 years with the 10 states not changing their laws. If all states were to come aboard and legalize gambling and if sports leagues were not given the option of not participating, Price Waterhouse estimated the government could make $42.8 billion in the first 10 years of legalization.

With 2008 being a presidential election year with candidates promising many programs that the government will have to finance without raising taxes, legalizing gambling may become an attractive method of increasing government revenue without major PR scandals.

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