Testimony: Keith S. Whyte

March 9, 2000

Statement of Keith Whyte, Executive Director of the National Council on Problem Gambling, on HR 3125 Internet Gambling Prohibition Act, before the U.S. House of Representatives Committee on the Judiciary, Subcommittee on Crime

March 9, 2000

Chairman Hyde and the members of the Committee on the Judiciary, Subcommittee on Crime, thank you for the opportunity to testify before this committee on behalf of the National Council on Problem Gambling, the nation's oldest and largest organization dedicated to addressing problem gambling. Since 1972 the National Council on Problem Gambling (NCPG) has worked with Federal, state, tribal and local governments, industry and other non-profit groups on problem gambling issues. We have consistently maintained a position of neutrality, neither supporting nor opposing gaming.

The mission of the National Council on Problem Gambling is to increase public awareness of pathological gambling, ensure the widespread availability of treatment for problem gamblers and their families, and to encourage research and programs for prevention and education.

The National Council administers several nationwide programs, including a 24-hour confidential helpline, a gambling-specific certification program for treatment professionals, and sponsors the Journal of Gambling Studies, the only academic journal in the world devoted to problem gambling research. In addition, the NCPG sponsors regional, national and international conferences, supports research, distributes literature and works with other organizations involved in problem gambling issues. The National Council on Problem Gambling is a tax-exempt, non-profit corporation.

The NCPG currently has 34 state affiliate chapters, and corporate and individual members. They encompass the leading United States and international experts in problem gambling policy, research, prevention, education and treatment. We represent individuals, families and loved ones affected by problem and pathological gambling.

The NCPG neither supports or opposes HR 3125, the Internet Gambling Prohibition Act of 1999. We are concerned about the impact of internet gambling on individuals who may have gambling problems and we are concerned about the exemptions for new operations in this bill.

We applaud the bill sponsors and supporters for their concern about internet gambling, and certainly support their call for increased Federal attention in this area, as recommended by the National Gambling Impact Study Commission (NGISC).

We also recognize that historically, Federal efforts to address gambling have been riddled with exemptions, and that regulation and enforcement have been conducted at the state level. Furthermore, we are not taking a position on existing gambling-related activity conducted under current state or Federal law.

While the NCPG remains neutral on the legality or desirability of online wagering, we recognize that internet gambling may create additional risk factors, including social isolation and unlimited access. What we do know, however, is that online gambling, as with any other form of legal or illegal gambling, may be abused by individuals with gambling problems. Furthermore, the availability of internet gambling may act as a trigger for relapse for pathological gamblers in recovery. Our primary concern is for the approximately 1-2% of the U.S. adult population estimated to be currently suffering from the serious mental health disorder of pathological gambling. We urge greater Federal and state attention to the education, public awareness, prevention, treatment and research of this disorder.

Although HR 3125 prohibits many types of internet wagering, it also contains exemptions that allow several sectors of the U.S gaming industry to conduct internet gambling. Of these groups, state lotteries alone accounted for approximately $25 billion in gaming revenue last year, almost half of the total U.S. gaming revenue. When parimutuel wagering industry is added in, more than half the U.S. legal gaming industry by revenue would be allowed to offer at-home wagering. Nearly four-fifths of the states have lotteries, parimutuel facilities or both. Therefore, this bill is a selective expansion as well as a limited prohibition of internet gambling.

We are particularly concerned that current language in this bill may open the door to minors betting on the Internet. As you know, each state determines the legality and regulation of each form of gaming. Unfortunately, as the NGISC noted, few states have approached this with a consistent public policy. The result is a patchwork of differing rules and regulations for each type of gaming in a state. Most notably, this results in differing legal ages for different forms of gaming. Illinois is one such state. While the minimum legal age to play the lottery is 18 years old, blackjack and craps players in a riverboat casino must be 21 years old, unless the blackjack and craps are operated by a charity, where individuals 18 and older can gamble. Minors are allowed to bet on parimutuel racing at the age of 17 in the state of Illinois.

Section (a)(2)(C) of the bill prohibits "access by any person…who is a minor" but Section (a)(2)(B) allows persons to gamble from home if the system is operated "…in accordance with the laws of the State in which it is located…." We are concerned that this provision could be interpreted as permitting minors, who are allowed to gamble under Illinois law, to participate in the at-home gambling sanctioned under this bill. Gambling is an adult activity and is never appropriate for minors.

The NCPG also recommends the inclusion of additional responsible gaming provisions into the bill. Sections (a)(2)(B) and (C) set conditions under which interactive wagering is permissible, including the restriction on minors and the requirement of a positive age-verification system. We suggest the inclusion of additional language to reduce the impact on problem gamblers. In particular, we support placing limits on the amount wagered per transaction and per session or day. We support requiring at least a 12-hour waiting period between the deposit of gaming funds and their availability. We support requiring operators to post problem-gambling helplines and responsible gaming messages encouraging customers to seek help if they have a problem. The addition of these minimum standards may encourage an individual with a gambling problem to seek appropriate help. We would be happy to work with staff and industry representatives on these and additional measures to help mitigate problem gambling. These suggested additions follow the precedent set by the customer and age verification system and data standards requirements in the existing legislation.

We believe that any discussion of gambling should include information on the potential health risk of problem and pathological gambling. It is also our belief that there is a need for increased public awareness and prevention efforts anywhere that gambling, legal or illegal, is available.

In conclusion, I would like to thank the committee for the opportunity to present our views on this issue. I would be happy to respond to any questions.