Ominous Interpretation Of Frank’s Anti-UIGEA Bill 

In a blog at Reason.com titled “Would Frank’s Gambling Bill Favor U.S. Companies?” Senior Editor Jacob Sullum refers to an unpublished analysis by gambling law expert I. Nelson Rose. Rose is of the opinion that Frank’s bill, if passed, would discriminate in favor of US companies. 

This is how Rose analyses the issue. According to the bill the treasury secretary would be the authorized federal agent who would issue licenses to online gambling operators, except for those engaged in sports betting. In all probability this authority would be passed on to “any State or tribal regulatory body with expertise in regulating gambling” as per the provisions of the bill. A gambling operator licensed by any authority could provide services to the whole of the United States excepting for the states that would declare to opt out. 

Here is the catch. A license will be denied to anyone who “is delinquent in filing any applicable Federal or State tax returns or in the payment of any taxes, penalties, additions to tax, or interest owed to a State or the United States.” According to Rose the online gambling operators who were operating in the United States before the passing of the UIGEA and have since left would be considered delinquent under the above definition and would therefore be denied licenses. Therefore all the big European online gambling operators who had any presence in the United States in the past would be unable to access the American online gambling market even if Frank’s bill is passed. On the other hand American land casinos, like Harrah’s, who have never engaged in online gambling but are now waiting to do so, will easily get licenses. 

Therefore though Frank’s bill intends to correct the protectionist attitude of America’s current gambling policy, in practice this may not happen.