Report: No more delays for UIGEA

From PokerNews.com:

Unlawful Internet Gambling Enforcement Act regulations will not receive another delay from the Treasury Department, according to CongressmanBarney Frank. The anti-poker legislation will go into effect June 1.

It appears the power play by Sen. Jon Kyl (R-Ariz.) in blocking President Obama’s Treasury nominees from taking office worked, strong-arming Treasury Secretary Timothy Geithner.

“Geithner promised he won’t delay the bill again because Kyl was holding up all the nominees,” Frank said in a phone interview with PokerNews.

Kyl lifted his block in early February, apparently after getting what he wanted from Geithner.

Frank isn’t concerned about the development. He believes that, in the long run, UIGEA regulations going into effect will help to eradicate the flawed legislation rather than just delay it.

“It’s fine with me,” Frank said. “I think it’s frankly so dumb and oppressive that it will create support to repeal the bill. I think, once it goes into effect, banks are going to raise hell and all the bankers will go to the Senate to complain.”

The UIGEA would prohibit U.S. financial institutions, including banks and credit card companies, from sending money to Internet poker sites. The controversial legislation, which would put the responsibility on the banks to decide what constitutes unlawful Internet gambling and identify the sites that fall in that category, has long been delayed since it was passed by Congress in October 2006.

The compliance date for UIGEA regulations was scheduled for Dec. 1 of last year. The Poker Players Alliance petitioned for a delay, supported by Frank and more than 20 of his fellow Congressmen, and Geithner granted a six-month extension to allow Congress time to pursue legislation that would make the UIGEA obsolete.

Frank held a hearing on his Internet Gambling Regulation, Consumer Protection and Enforcement Act a week later in the House Financial Services Committee, but no further progress has been made as Frank, the head of the committee, focused his attention on more pressing economic concerns. Frank says he still intends to have a markup of that bill, which would override the UIGEA, in the committee “sometime this spring, probably in May.”

PPA leaders had hoped that progress on the regulation bill by getting it passed in the committee would convince Geithner that another delay was justified, but it appears Kyl — the long-time opponent of Internet poker who pushed for the UIGEA’s passage — used his political maneuvering to win this round.

“The Treasury, Federal Reserve, Congress and the banking community agree that the proposed UIGEA regulations are overly broad and lack the key definition of ‘unlawful Internet gambling,’” PPA executive director John Pappas said. “This was the case when the regulations were delayed in November and it remains the case today. Enacting the final rule on June 1st without this clarification would be a huge mistake and will add another layer of confusion upon an already complex matter.”

“Ultimately, there needs to be legislation like HR 2267 or S 1597 that will remove the confusion and establish a clear and sensible regulatory policy that the government, banks and, most importantly, consumers can rely on. The PPA remains optimistic that this will happen sooner rather than later, and that the misguided enactment of the UIGEA will be a catalyst for this change.”