Two members of the U.S. House of Representatives testified today before a Senate committee on banking about Internet gambling's role in international money laundering.
Reps. Michael Oxley, R-Ohio, and John LaFalce, D-N.Y., told the Senate Banking, Housing and Urban Affairs Committee that online gambling and credit card fraud are terrorists' main methods of laundering funds.
The Senate banking committee's meeting today was an oversight hearing on the administration's implementation of the anti-money laundering provisions of the PATRIOT Act. The PATRIOT Act was passed by both houses and signed by President Bush in October. It gives federal law enforcement agents additional powers to prevent terrorism, including increased wiretapping authority and longer detentions of terrorist suspects who aren't U.S. citizens.
Oxley told the Senate Banking Committee today that illegal credit card transactions are "used extensively in Internet gambling and to transact business through unregulated offshore secrecy havens."
Rep. LaFalce, who is the House Financial Services Committee's ranking Democrat, said credit card associations should be required to use the anti-money laundering provisions of the PATRIOT Act, Newsbytes News Network reported.
"If we don't deal with that issue, we're going to have unbelievable money laundering taking place globally," he said.
The House of Representatives has four bills under consideration that could potentially affect the legality of Internet gambling in the United States. Those bills include H.R. 556, which would stop financial institutions from accepting credit cards, checks or electronic funds transfers as payment for money laundering, and H.R. 3215, which would update the 1961 Interstate Wire Act to specify Internet gambling as illegal.