[Congressional Record (Bound Edition), Volume 153 (2007), Part 19]
[Extensions of Remarks]
[Page 27187]
[From the U.S. Government Publishing Office, www.gpo.gov]




               CONTINUED PROHIBITION OF INTERNET GAMBLING

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                            HON. TOM FEENEY

                               of florida

                    in the house of representatives

                        Monday, October 15, 2007

  Mr. FEENEY. Madam Speaker, last year, I cosponsored legislation with 
Congressman Bob Goodlatte to help stop the widespread growth of 
gambling over the internet. Though Federal law already prohibits 
gambling over telephone wires, the passage of this legislation was 
necessary to maintain the original intent of the law while also 
bringing it up to speed with the explosion of current and future 
technology. However, this update of the law made clear that it would 
only affect interstate commerce, respecting the rights of States by 
leaving to them the decision whether and how to regulate gambling 
within their own borders. New legislation before the Financial Services 
Committee attempts to undo all of this previous work, instead granting 
the Federal Government the expansive and exclusive right to regulate 
all online gambling. This new legislation would represent the first 
time in history that the Federal Government would be given power to 
issue gambling licenses, and it marks a significant shift away from 
allowing States to determine for themselves what type of policy is 
best. Proponents of this legislation state that the bill offers States 
the right to ``opt out'' of this regulation, but the truth is that the 
States already have the right to determine their own policy towards 
gambling without any broader Federal regulation that threatens to 
undermine their control over licensing standards and enforcement 
actions.

                                               September 28, 2007.
       Dear Chairman Frank and Ranking Member Bachus: We, the 
     Attorneys General of our respective States, have grave 
     concerns about H.R. 2046, the ``Internet Gambling Regulation 
     and Enforcement Act of 2007.'' We believe that the bill would 
     undermine States' traditional powers to make and enforce 
     their own gambling laws.
       On March 21, 2006, 49 NAAG members wrote to the leadership 
     of Congress: We encourage the United States Congress to help 
     combat the skirting of state gambling regulations by enacting 
     legislation which would address Internet gambling, while at 
     the same time ensuring that the authority to set overall 
     gambling regulations and policy remains where it has 
     traditionally been most effective: at the state level.
       Congress responded by enacting the Unlawful Internet 
     Gambling Enforcement Act of 2006 (UIGEA), which has 
     effectively driven many illicit gambling operators from the 
     American marketplace.
       But now, less than a year later, H.R. 2046 proposes to do 
     the opposite, by replacing state regulations with a federal 
     licensing program that would permit Internet gambling 
     companies to do business with U.S. customers. The Department 
     of the Treasury would alone decide who would receive federal 
     licenses and whether the licensees were complying with their 
     terms. This would represent the first time in history that 
     the federal government would be responsible for issuing 
     gambling licenses.
       A federal license would supersede any state enforcement 
     action, because 5387 in H.R. 2046 would grant an affirmative 
     defense against any prosecution or enforcement action under 
     any Federal or State law to any person who possesses a valid 
     license and complies with the requirements of H.R. 2046. This 
     divestment of state gambling enforcement power is sweeping 
     and unprecedented.
       The bill would legalize Internet gambling in each State, 
     unless the Governor clearly specifies existing state 
     restrictions barring Internet gambling in whole or in part. 
     On that basis, a State may ``opt out'' of legalization for 
     all Internet gambling or certain types of gambling. However, 
     the opt-out for types of gambling does not clearly preserve 
     the right of States to place conditions on legal types of 
     gambling. Thus, for example, if the State permits poker in 
     licensed card rooms, but only between 10 a.m. and midnight, 
     and the amount wagered cannot exceed $100 per day and the 
     participants must be 21 or older, the federal law might 
     nevertheless allow 18-year-olds in that State to wager much 
     larger amounts on poker around the clock.
       Furthermore, the opt-outs may prove illusory. They will 
     likely be challenged before the World Trade Organization. The 
     World Trade Organization has already shown itself to be 
     hostile to U.S. restrictions on Internet gambling. If it 
     strikes down state opt-outs as unduly restrictive of trade, 
     the way will be open to the greatest expansion of legalized 
     gambling in American history and near total preemption of 
     State laws restricting Internet gambling.
       H.R. 2046 effectively nationalizes America's gambling laws 
     on the Internet, ``harmonizing'' the law for the benefit of 
     foreign gambling operations that were defying our laws for 
     years, at least until UIGEA was enacted. We therefore oppose 
     this proposal, and any other proposal that hinders the right 
     of States to prohibit or regulate gambling by their 
     residents.
           Sincerely,
     Douglas Gansler,
       Attorney General of Maryland.
     Bill McCollum,
       Attorney General of Florida.

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