New move to repeal US online gambling ban

Online gambling companies would have to be “properly licensed” under US legislation introduced on Thursday by a top Democratic lawmaker, raising the heat once again on a contentious US ban on the practice.

Barney Frank, chairman of the House financial services committee, has made overturning last year’s ban on online gambling a priority, calling it “one of the stupidest” pieces of US legislation ever passed.

Last year’s law sought to outlaw gambling by targeting the payment system used, barring credit card companies from accepting bets placed by US citizens on foreign websites.

Mr Frank’s bill would create a new licensing regime for them that would create an exemption from the payment system bar.

It would also include protections against underage gambling, compulsive gambling, money-laundering and fraud. Licensing would be handled by the US Treasury’s anti money-laundering unit.

Shares in Gibraltar-based Partygaming, the world’s largest internet poker operator, fell 13 per cent to 51p in London on the news. Analysts said the proposed bill was likely to benefit US gambling operators.

At a press conference on Thursday, Mr Frank quoted passages from John Stuart Mill, the British liberal thinker of the 19th century, to support his view that – while no fan of gambling himself – he saw the ban as an “inappropriate interference on the personal freedom of Americans”.

“This is a kind of libertarian, ‘let people have fun’ kind of thing,'' he said.

The bill faces a significant hurdle to pass the House since last year’s ban was passed overwhelmingly.

However supporters of the bill pointed to the fact that it was co-sponsored by Peter King, a Republican from New York, who voted in favour of the original ban. “This does for the first time set in place a strong regulatory framework at the federal level,” Mr King said of the proposed bill.

Asked if there was anything to suggest a change in attitude to the issue of gambling in congress since last year’s vote, Mr Frank said: “I remember once voting here in the House where I was the only person who voted a certain way and was asked how I felt being on the short end of a vote of 427 to one. I said I felt I was in very good company.

“I do think this is a special case. I do not think a lot of members gave it a lot of attention. I do think there is more reason to think people [will be] willing to change their minds,” he said.

The financial services committee plans to hold hearings on online gambling in June.

Copyright The Financial Times Limited 2017. All rights reserved. You may share using our article tools. Please don't cut articles from FT.com and redistribute by email or post to the web.