LaFalce: 'Funding Bill Will Resurface'

16 July 2001
During last week's House Finance Committee hearing on Internet gambling Rep. John LaFalce, D-N.Y., the ranking Democratic member of the committee, announced that he would introduce an updated version of his Internet Gambling Funding Prohibition Bill (HR 4419), a bill that failed to pass out of committee last year.

Although a date hasn't been set, the bill will likely be introduced sometime this week, according to Dean Sagar, a spokesman for LaFalce.

LaFalce's bill already has competition; last year's co-sponsor for HR 4419, Rep. James Leach of Iowa beat LaFalce to the punch by introducing HR 566 (the "Unlawful Internet Gambling Funding Prohibition Act") in Feb. 2000.

The LaFalce version, however, will differ somewhat from Leach's in that it will include language much more like that in the original version of last year's bill. HR 566, in comparison, is nearly identical to last year's amended version of HR 4419.

The difference between the two bills is language introduced through Rep. John Sweeney's, R-N.Y. amendment to 4419, which would exempt any instrument used to place a bet that is legal under federal or state law. The Sweeney amendment was broad enough to permit not only pari-mutuel wagering, but also any type of gambling transaction that is legal "under any applicable federal or state law in the state in which the bet or wager is initiated or received."

Thus, in addition to pari-mutuel gambling, state lotteries would be exempted, as would be card rooms and online casinos that legally operate under state law.

LaFalce voted against the Sweeney amendment last year. "The Sweeney language . . . was just inadequate," Sagar explained.

LaFalce maintains that the language would leave Leach's legislation vulnerable to legal challenges as to what kind of gambling site is unlawful, since there is no clarification of what types of gambling are "lawful." But under the terms LaFalce's bill, it wouldn't matter if I-gaming is legal elsewhere since it would be deemed illegal in the United States.

LaFalce is also considering adding language that "may address the third-party payment systems, like PayPal."

Sagar explained LaFalce's reasoning for introducing his own version of the Unlawful Internet Gambling Prohibition Act: "Either you don't do it (prohibit gambling). . . or close off the payment methods for it," he said.

He admitted that stopping online gambling won't be easy and also acknowledged that the onus of enforcement would be in the hands of Visa and MasterCard--something that the two companies so far are unwilling to accept.