Originally Posted by bad gambler
However does this cover Neteller I wonder...hmmmmmmmmmmm
BG - Yes it covers, neteller, paypal presumably western union and a few others. This is a HUGE deal and a major blow. Be careful with the books your in right now. Alot of the smaller books might be going out of business due to this. This is a great article we posted at our forum which is a US based forum.
Here it is best summed up by betasia.com
Will Online Gambling be shut out? << Back
An analysis of the Unlawful Internet Gambling Enforcement Act of 2006 and what it means for gamblers around the world.
What does the Act aim to do?
The Act aims to stop anyone handling financial transactions related to online gambling, with a few minor exceptions.
Essentially, it aims to stop banks from allowing customers to send funds to offshore sites and to criminalize those who accept those funds for the purpose of gambling.
The Act is pretty ‘catch all’ in what counts as a financial transaction – it covers credit cards, electronic funds transfers, checks, drafts and ‘proceeds from any other financial transaction’.
It covers all ‘unlawful Internet gambling’ including poker. The Act defines ‘unlawful Internet gambling’ as “to place, receive, or otherwise knowingly transmit a bet or wager by any means which involves the use, at least in part, of the Internet where such bet or wager is unlawful under any applicable Federal or State law in the State in which the bet or wager is initiated, received, or otherwise made.” In other words, unless the gambling is state legislated then it is illegal.
When will it come into force?
Assuming that President Bush does not refuse to sign the Act – which is extremely unlikely – the law will change on his signature.
Financial institutions will then have 270 days to implement the regulations within the Act. Detailed regulations will be drawn up about what measures they must undertake to ensure they are not handling gambling transactions and if they comply with the regulations they will not be prosecuted, even if they inadvertently handle some gambling transactions by mistake. Essentially this means that all gambling transactions will have to be specifically coded as such and automatically blocked if they have that code.
There are likely to be several legal challenges to the Act which may take as long as a year to resolve. Most importantly, it appears this legislation is in direct contravention of the World Trade Organisation rulings against the United States in relation to online gambling. However the US government has hitherto ignored WTO rulings relating to gambling until now and is unlikely to change their stance in the near future.
Who proposed this Act and why?
The Act is based largely on a previous bill proposed by Congressman Jim Leach, (R-Iowa) in the House of Representatives and a similar bill proposed by Senator Jon Kyl (R-Arizona) in 2005. Certain aspects of it – in particular a clarification of the 1961 Wire Act which covers interstate betting by telephone – were dropped at the last minute because of lobbying by ‘real world’ gaming interests.
There are various theories as to why the law was passed now.
Democrats accuse Republicans of pushing the bill to placate its conservative base, particularly the religious right, before the November 7 congressional elections but certain Republicans have been trying to get anti-online gambling legislation passed for nearly a decade.
Others have suggested that the huge growth of online poker and the increasingly aggressive advertising tactics of the big poker sites made legislators eager to crack down on the industry, especially as it pays no tax revenues to the United States.
The arrest of David Carruthers, chief executive of sports betting site BetonSports, on racketeering charges also raised the stakes. The company’s founder, Gary Kaplan, was allegedly linked to criminal gangs in the United States and opponents of online gambling argued that many websites were being used as a front for money laundering and other criminal behaviour. Given that so many of the companies were floated on the London Stock Exchange and audited by the major accountancy firms, this seems a little fanciful but looked plausible to conservative opponents of gambling.
Who does it affect?
The wording of the legislation is aimed at anyone ‘in the business of betting’. This was intended to catch those who operate online gambling sites but it could cover a wider scope than that.
While those drafting the legislation did not intend to criminalize any individual placing a bet or playing poker online the loose wording could, in theory, catch someone who made their living as a professional gambler or poker player. It is unlikely that this would be applied to individuals but it is not impossible that this legislation could be used to prosecute an individual.
The wording suggests that anyone running a site promoting online gambling – whether it is a sports gambling information site, sports betting forum, watchdog site, rakeback or affiliate site – could be considered to be ‘in the business of betting’. This is likely to affect thousands of small gambling websites. The legislation allows for the government to ask sites to remove links to gambling sites and also to ask Internet Service Providers to take the companies offline. Realistically, if the online gambling sites cease to operate then so will these information sites as there will be no affiliate revenue to keep them going.
It is also suggests that ‘skill gaming’ sites will be illegal – under the definition of the Act it definitely appears that playing chess for money online will now be in breach of the law.
Who does it not affect?
The chief winners from the Act are operators of fantasy sport sites. Despite the fact that their activities are very similar to gambling in many ways, there is a specific exemption for fantasy sites. However they may not have their scoring systems based on a team’s performance, team score on the point spread on that game. This means fantasy sports must be based on the statistical performance of a group of players. The fantasy sport operators may also not offer prizes related to the number of entrants into the fantasy pool.
How fantasy sports have managed to get this exemption is something of a mystery and no doubt some online gambling operators will be looking to see if their sites can be changed into fantasy sites.
State lotteries also do well from this legislation. They are now specifically allowed to start online operations and to club together to provide multi-state jackpots on their sites. It also allows them to run 'casino style' games of chance on their websites, akin to the Fixed Odds Betting Terminals in UK betting shops.
What are the penalties for breaking this law?
The Act allows those breaking the law to be imprisoned for up to five years.
What does this mean for the future of online gambling?
At the moment it means that a huge number of investors are a lot poorer and a lot of lawyers are getting paid a ton of money to work out what is and what is not covered by this legislation.
In the long term it may lead to the legalisation and taxation of online gambling in the United States. As America has found in the past with Prohibition, it is extremely unlikely that the passing of this legislation will stop sports gambling by their citizens. ‘Locals’, as bookies who operate out of bars and cigar shops across America are known, are throughout the states and can expect to see a boom in their business in the coming months. Laws that merely shift a problem rather than eliminate it are historically neither popular or long lasting.
There may also be a large number of recreational poker players who will be extremely displeased by having their online poker pastime eliminated by legislators. Whether these players will have any political clout is questionable but there will be many relatively educated and wealthy people who wonder why their government feels it necessary to remove access to something that for the vast majority of people has no negative effects. This is especially true when so many real world poker rooms (and casinos, horseracing tracks, lotteries etc) exist across America, suggesting that a different standard is being applied to online gambling versus all other forms of gambling.
The main problem is how or why this Act could be over-turned. This is little political incentive for any politician to try and promote online gambling. The number of people who would specifically vote for an individual because they promoted a bill that allowed them to bet online is minimal. Yet the downside of proposing it is huge – the backlash from the conservative heartland and right wing bloggers would be enormous – and potentially not just damaging to the individual but also to their party. Perhaps the best hope for anyone who wants to see online gambling legalized for the US market is that the federal government will realize the scale of illegal betting within their territorial boundaries and think that taxation and regulation is better than the activity being run and controlled by Mob enterprises.
I don't live in America. Does this affect me?
Anyone who has a pension fund that invests in the London stock market has probably already lost money following the passing of the Act. Shares plunged on the news of the act passing and as most pension funds which track the FTSE 100 index had shares in Party Gaming then their pension funds will be poorer because of it.
As a gambler it might just affect you. Profits from American bettors have been the main driver of the online betting industry in the last decade. Without those profits companies will change their behaviour. Also, investors will be less willing to put their money into these companies, meaning that there is less competition in the long run.
For sports bettors this may mean that margins creep up from the present highly competitive level. In theory it could mean that the non-American markets will become more competitive as everyone seeks to find new customers in these territories but initial reaction in the industry suggests the Act will hurt the global gaming industry in every territory.
If you play poker you will almost certainly find there is far less 'value' in the games you play online. Fewer players will probably make the games more competitive and tougher to beat. Companies will be making lower profits and will be less willing to give money back to players in the form of rakeback and bonuses.
Courtesy of BetAsia.com.