Kyl Bill Passed by Senate Committee

VANCOUVER, British Columbia, July 31, 2003 — “The Interactive Gaming Council regrets that the U.S. Congress took another step backwards today when the Senate Banking Committee approved S.627. Our country has had one sorry experience with Prohibition, and this approach will not work any better in cyber space.

“The Senate Banking Committee’s amendment to eliminate state governments’ right to regulate online gaming sets a bad precedent. State governments, which have historically licensed, regulated, and taxed the gaming industry, may eventually forfeit this right as well as vital gaming tax revenues to the Federal government. State governments and the gaming industry should be concerned about a potential for a Federal siphoning of gaming taxes that are often dedicated to important state programs that benefit senior citizens and children.

“The IGC had hoped that Banking Committee members would recognize that legalization and strict regulation, rather than prohibition, is the only way to achieve important policy goals. More than ever, we believe that perceived problems associated with interactive gaming — the potential for exacerbating the problems of compulsive gamblers, for underage betting and for money laundering — can only be resolved through a combination of up-to-date technology, proper internal controls and stringent regulatory oversight.

“We take seriously the concerns expressed by members of Congress. IGC members will continue to accomplish as much as industry self-regulation can to deal with these social issues. But ultimately this is a task that requires the force of governmental regulation. It’s a shame that Congress seems intent on making futile gestures at prohibition of interactive gaming, when regulation of traditional, land-based gaming has served our society so well.

‘IGC members are disappointed that very little consideration has been given to developing a practical and politically palatable regulatory scheme for legal and regulated Internet gambling in the U.S. The debate needs to include discussion on how regulation can reverse the current situation where monies from U.S. citizens leave the United States with no subsequent benefit, directly or indirectly, to our government or to our citizens. One consequence of this is that no funds are dedicated to protecting children and problem gamblers through education and other programs.

“The IGC also believes that American citizens will not appreciate their financial institutions dictating how they can spend their money. That intrusive prospect has to worry anyone involved in e-commerce generally, let alone those concerned about a deprivation of their personal freedom.

“You don’t have to be a gambler to be wary of the ‘Big Brother’ implications of S.627 and H.R.2143. Americans treasure freedom of personal choice and the right to privacy, and do not want the government to force banks to monitor every transaction that is done online.”