Congress Seeks to Ban Internet Poker

See blog below for details.

Domestic Spying Via Internet Gaming Bills

Domestic Spying Via Internet Gaming Bills
Implications for $20 Billion of Immigrant Remittances to Mexico

These two bills aim to curtail Internet Gaming in the US. While HR 4777 provides criminal penalties including five year imprisonment for accepting Internet bets, HR4411 is far more subtly insidious in its privacy invasion possibilities. Leach (R-Iowa) provided the substitute bill to the latter which was approved on March 15, 2006 by the House Financial Services Committee just before the Easter recess.

HR4411 instructs ALL PARTIES involved with the personal payment system, including insured financial institutions, credit card companies, electronic fund transfer (Paypal, for instance), money transmitting services (Western Union, for instance) to follow soon to be prescribed regulations from the Board of Governors of the Federal Reserve System to

"identify and block or otherwise prevent or prohibit restricted transactions through the establishment of policies and procedures reasonably designed to identify and block or otherwise prevent or prohibit the acceptance of restricted transactions" by "allow the payment system and any person involved in the payment system to identify restricted transactions by means of codes in authorization messages or by other means; and block restricted transactions identified as a result of the policies and procedures developed."

BOTTOM LINE: HR4411 sets up a system that will examine EVERY Internet or payment system transaction, screen those that have certain "codes in authorization messages" and then require money transfer service providers to BLOCK the underlying transaction--all in REAL time.

BOTTOM LINE: HR4777 requires ISPs to remove and disable access to an online site violating this section -- "engaged in gaming."

CARVE OUTS: Indian Gaming, state approved gambling and lotteries, interstate horse racing, domestic dog racing, closed-loop subscriber-based live Jai-Alai (whatever that is), and of course, the most risky forms of gambling: securities derivative and commodities trading.

IMPLICATIONS FOR MEXICAN REMITTANCES: Because all Internet gambling is carried on overseas, all payments are consumer-sized, international, and immediately suspect. Mexican immigrants alone remitted $20 Billion in 2005 (Http://www.dallasfed.org/research/swe/soo6/swe0601c.html), every one of these remittances would be initially flagged under this system. Internet gambling remittance sites would set up Mexican-based portals.