[Congressional Record (Bound Edition), Volume 152 (2006), Part 18]
[Extensions of Remarks]
[Pages 23776-23777]
[From the U.S. Government Publishing Office, www.gpo.gov]




H.R. 4954, THE SAFE PORT ACT UNLAWFUL INTERNET GAMBLING AND ENFORCEMENT 
                             ACT PROVISIONS

                                 ______
                                 

                          HON. SPENCER BACHUS

                               of alabama

                    in the house of representatives

                       Thursday, December 7, 2006

  Mr. BACHUS. Mr. Speaker, I would like to address the recent enactment 
of the Unlawful Internet Gambling and Enforcement Act of 2006. Internet 
gambling legislation has been a priority for this Congress the last 
several years. In 2003, I sponsored H.R. 2143, the Unlawful Internet 
Gambling Funding Prohibition Act and have cosponsored Mr. Leach's 
Internet gambling bills in each of the last three Congresses. The 
Conference Report for H.R. 4954, the SAFE Port Act, which was enacted 
into law, reflects Mr. Leach's Internet Gambling Prohibition and 
Enforcement Act, H.R. 4411.
  Five years ago, there were less than 50 Internet gambling sites. 
Today, there are close to 2,000 sites that will generate upwards of 
$5.9 billion this year alone. The legislation that was enacted into law 
addresses the problem of illegal internet gambling through an 
enforcement mechanism. The new law does not change the legality of any 
gambling activity in the United States. The sole purpose of this law is 
to enforce against activities that are already illegal under the Wire 
Act and other Federal and State statutes. It enforces illegal gambling 
by preventing the use of any bank instrument--such as a credit card, 
check or electronic fund transfer--for Internet gambling.
  Though online gambling has been illegal in this country from its 
inception--under state law, not just federal law--we have had serious 
problems enforcing these laws. The advantage

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and the disadvantage of the Internet is that it has no borders. Nothing 
can stop bets and wagers from being placed using a Web site hosted in 
another jurisdiction. When that bet or wager causes a violation of our 
laws, we had no effective means of enforcement until now.
  Congress reviewed a number of possibilities to better enforce the law 
on the books. One enforcement option was to prosecute the gambler. 
However, enforcement against individual gamblers is a State prerogative 
under our federalist system. The Federal government has never claimed 
the authority to prosecute gamblers. And though gambling online is a 
misdemeanor in most States, it would be impossible for States to 
effectively enforce this way. The State would have to monitor people's 
Internet usage, which raises serious constitutional issues.
  Next, Congress considered ``notice-and-take-down'' measures to combat 
illegal Internet gambling. The Senate passed bills twice that would 
have authorized law enforcement to notify computer services when an 
illegal web site was using their services, and require them to take 
down or block the illegal site. Time has shown that blocking just about 
anything on the Internet simply does not work, though take-down orders 
do work for web sites hosted by domestic companies. So we have retained 
the notice-and-take-down option in the new law where it has a chance of 
being effective--for gambling web sites hosted or advertised by 
Internet companies based in the United States.
  But take-down orders, and prosecuting gambling businesses that 
violate State and Federal laws, are completely ineffective for Web 
sites hosted offshore. The U.S. legal system cannot reach offshore 
companies, even though their Web sites can reach U.S. consumers. So the 
gambling operators deliberately locate in jurisdictions that will not 
cooperate with the U.S. Here, existing laws reach the end of the rope.
  We concluded that the only real option, if we want to enforce our 
gambling laws in the age ofthe Internet, is to block the financial 
transactions that pay for illegal online gambling. Banks and payment 
systems located in the United States are fully within the reach of 
Federal law, and U.S. citizens usually have to go through them to send 
money over the Internet. So requiring payment systems to put in place 
blocking procedures allows us to effectively and efficiently stop the 
flow of money, even when the gambling business itself is beyond the 
long arm of our law. Without the money, gambling simply cannot happen.
  We needed to pass this law because it is the only way we can 
effectively enforce State and Federal gambling laws when offshore Web 
sites offer illegal services to our residents. This is also why the 
Department of Treasury and the Federal Reserve Board need to write 
strong regulations that will not be easily evaded. I am proud to have 
supported this vital law, and I look forward to working with the 
regulators to ensure they properly reflect Congress's intent. My only 
regret is that my friend and colleague Jim Leach will not be here to 
assist Congressman Goodlatte and others in our continued efforts.

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