President George W. Bush on Friday signed into law a ban on online wagering. The legislation, called the Unlawful Internet Gambling Act (UIGA) makes it illegal for banks, credit card companies, and other financial intermediaries to transfer funds to online gambling sites. It does not outlaw the sites, just makes it illegal to settle online wages. The legislation was tucked into the a $400-million comprehensive port-security bill called the Security and Accountability for Every Port Act (SAFE), designed to keep nuclear, chemical, or biological weapons out of the 11 million shipping containers that make their to the U.S. each year. “Today is a dark day for the great American game of poker,” said Michael Bolcerek, president of the Poker Players Alliance (PPA), a grass-roots advocacy organization of more than 110,000 poker enthusiasts. “Twenty-three million Americans who play the game online will effectively be denied the ability to enjoy this popular form of entertainment, even in the privacy of their own homes.” “Congress had a real opportunity to create good public policy by licensing, regulating, and taxing Internet poker. Yet, they chose prohibition. This decision will prove to be detrimental in the long run and leaves more than $4 billion in annual tax revenue on the table,” said Bolcerek. The legislation contains specific exemptions for Internet wagers on horse racing, state lotteries, and fantasy sports. The PPA said it hopes Congress objectively evaluates the skill game of poker and affords it similar treatment. As a result of the ban, online casino companies everywhere have pulled out of the U.S. Britain’s SportingBet and Leisure & Gaming have sold their U.S. operations to private investors for $1. World Gaming meanwhile said it was impossible to continue in business and called in administrators. Australian gaming firms Lasseters and Betcorp said they would cease soliciting customers in the U.S. Betcorp said it would freeze withdrawals by U.S. residents “in order to ensure an orderly return of funds to them.” “The board accepts that this will cause some short-term inconvenience to clients but believes that, in these unique circumstances, it is in the best interest of all stakeholders,” Betcorp announced. Fellow Australian gaming company Global Approach announced a profit downgrade in response to the U.S. legislative changes, and Managing Director James Canning-Ure said his company would ramp up activities in Asia and Europe. Lasseters Managing Director Peter Bridge said the decision had come as a shock to the industry, despite the July arrest of British online gambling chief David Carruthers. Bush’s endorsement had the result of “immediately eliminating around half of the world’s estimated $10-billion online gaming industry,” he said. “We have received legal advice from the U.S., and unfortunately see no alternative but to cease operating in the U.S. market,” said Bridge. “It is the company’s regret that the forced closure of the U.S. market had led to imposed redundancies.” SportingBet issued a statement saying the company undertook a “comprehensive legal and strategic review” of its U.S. operations following the passing of the Unlawful Internet Gambling Enforcement Act 2006 by U.S. Congress on Sept. 29. “Having considered the legal advice received and the options available, the board concluded that a disposal of the group’s U.S.-facing sports betting and casino operations together with the closure of its U.S. poker operations was in the best interest of all stakeholders,” reads the statement from SportingBet.
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