A new piece of anti-terrorist legislation in the U.S. may adversely affect the online gaming industry.
The American government has taken several steps over the past few weeks to freeze terrorist assets in the U.S., and Rep. Michael Oxley of Ohio introduced "The Financial Anti-Terrorism Act of 2001" as part of this effort. But a last-minute inclusion to the act does much more than prevent terrorists from laundering money through U.S. financial institutions.
A new section introduced by Rep. James Leach of Iowa would also prohibit the use of many financial instruments at online casinos.
Late last week, Leach was able to persuade Oxley to include a section in the terrorism bill that would target online gambling payment methods. This section was added under the pretense that online gambling sites could be used to launder money.
Credit card prohibitions aren't a new issue for Congress or Leach. Last February, Leach re-introduced a bill that would prohibit the use of credit cards, electronic fund transfers, and checks as payment methods for online wagering. The bill made its first appearance in the House during the summer of 2000, but failed to win approval at that time.
Leach's second attempt at the prohibition bill appeared to stall in the wake of the terrorist attacks, but last week's inclusion has resurrected it.
The language in the online gambling portion of Oxley's bill closely follows the tone of Leach's earlier efforts, but it doesn't sit particularly well with another bill sponsor, Rep. John LaFalce of New York.
LaFalce, who is on the record as an opponent of online gambling, believes the anti-gambling section will hinder the progress of the anti-terrorism bill and is concerned that the Internet gaming lobby in Washington might scuttle the terrorism bill.
Representatives of the FBI and Department of Justice have voiced their support for the gaming legislation, but gambling industry experts have questioned its timeliness and effectiveness.
Some have suggested that Leach is simply trying to take advantage of the situation to pass a bill that would otherwise fail. Other insiders have suggested that the use of credit cards at online casinos actually makes money laundering more difficult.
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