Online Gambling Supporters Argue For Technology, Critics Want RegulationsOnline Gambling Supporters Argue For Technology, Critics Want Regulations

Supporters and opponents of legalized online gambling testified before the House Judiciary Committee this week.

Representatives from the U.S. Department of Justice and members of the committee spoke out on gambling as a social ill during a hearing Wednesday, while those who want to overturn a ban on Internet gambling argued that the current prohibition violates World Trade Organization treaties.

Last year, Congress passed the Internet Gaming Enforcement Act, which prohibits banks, creditors, and other financial institutions from transferring funds for online gaming on behalf of their customers. Pro poker player Annie Duke said the law forces financial institutions to act as "morality police."

"What's at stake here is the right of individual Americans to do what they want in the privacy of their homes without the intrusion of the government," Duke told the committee. "This country was among the first to embrace the idea that there should be distinct limits on the ability of the government to control or direct the private affairs of its citizens. More than any other value, America is supposed to be about freedom. Except where one's actions directly harm another person's life, liberty, or property, our government is supposed to leave citizenry alone."

The WTO has issued rulings saying the United States has violated WTO treaties, and several countries want to penalize the United States. Some have demanded damages for revenue losses due to the ban. They say it favors certain U.S. companies which operate legal casinos in certain areas, including Las Vegas.

Joseph Weiler, of New York University's Hauser Global Law School, agreed.

"The U.S. bans online gambling offered by overseas operators even though it made treaty commitments to allow it and even though it allows online wagering domestically, including for horse racing," he told the committee. "We should bring our law and conduct into compliance with our international legal obligations. Our country is the trendsetter and leader in so many international arenas. Whether we like it or not, we lead by example."

Weiler pointed to the federal government's pursuit of London-based BetOnSports. He said U.S. leaders should consider a potential situation where the Chinese government, a key trade partner, would prosecute and imprison an American businessman for engaging in commerce banned in China after signing treaties that guaranteed Americans' rights to conduct such commerce.

Michael Colopy, a senior VP at Aristotle, a company that provides of verification services for child protection online, said technology can combat compulsive and underage gambling. "Online age and ID verification has matured as a needed solution such that any merchant may do online [and] what is routinely done at stores every day across America," Colopy said. "In fact, as ever more efficient technologies and databases have been developed, online transactions have become in many instances faster and less risky than the visual driver's license scans that suffice for alcohol or cigarette purchases in America's neighborhood convenience stores, restaurants, and bars."

Reps. Shelley Berkley (D-Nev.) and Barney Frank (D-Mass.) showed support for lifting the ban with restrictions to prevent compulsive and underage gambling, while Rep. Robert Wexler (R-Fla.) wants to exempt online poker and games of skill from the prohibition.

Berkley said the laws are confusing and haven't stopped 10 million Americans from wagering online. Judiciary Committee Chairman Rep. John Conyers (D-Mich.) showed no support for lifting the ban when he called gambling a social evil.

Catherine Hanaway, U.S. District Attorney for eastern Missouri, said the existing ban is the only legislation needed to cover online gambling.