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Web Gambling in Utah Debated
By Christopher Smith
The Salt Lake Tribune
WASHINGTON -- The head of a major online casino told Congress on Tuesday that bettors from Utah could be successfully blocked from gambling at Internet casinos, while a Justice Department official expressed skepticism over the effectiveness of the barriers.
The discussion came as a House subcommittee weighed the merits of two bills, one that seeks to prohibit the use of electronic funds transfer for Internet gambling and the other that seeks to study developing a federal licensing and regulatory framework for online wagering.
Utah 3rd District Rep. Chris Cannon supports the latter proposal to regulate Internet casinos, contending the bill prohibiting credit card payments for online wagering could lead to legalized gambling in Utah. Although Cannon didn't attend Tuesday's hearing on the bills, House Judiciary Subcommittee on Crime, Terrorism and Homeland Security Chairman Rep. Howard Coble, R-N.C., asked MGM Mirage Online President Bill Hornbuckle on Cannon's behalf whether technology could permit Internet casinos to block access to computer users from Utah, the only state where all forms of gambling are prohibited.
"No system is perfect but we can deliver with reasonable assurance to the congressman that the folks from Utah, if you didn't want them in, they wouldn't get in," said Hornbuckle, whose Internet casino is based on the Isle of Man in the United Kingdom. The MGM Web site caters only to European bettors by blocking Internet Protocol (IP) addresses from the United States. IP addresses reveal the location of a particular connection to the Internet.
But John G. Malcolm, the deputy assistant attorney general for the computer crime section of the U.S. Department of Justice, told the committee that a "technologically savvy" person could route bets through computers located in other countries and obscure the true IP address to gain access to the cyber gaming host computers.
Justice is supportive of the "Unlawful Internet Gambling Funding Prohibition Act," which would essentially make it illegal to use electronic fund transfers such as credit cards to pay for online gambling. But Cannon helped kill a previous version of the bill last session because he fears it may trump Utah's statutory gambling ban.
"Anytime you carve something out then you make it legal and that bill would essentially make gambling legal in Utah," he said in an interview. "I also have a deep reluctance to mandate what happens in the commercial market, so if we regulate gambling, it's an appropriate way to limit it and preserve the statutes of the state of Utah."
Cannon has joined a bipartisan group of House members pushing the alternative "Internet Gambling Licensing and Regulation Commission Act" that would recognize the widely varying state laws aimed at online gaming.
"Under the regulatory environment this bill provides for, if Nevada opts to allow Internet gambling within its borders it can and if Utah does not opt to allow Internet gambling within its borders it can prohibit it and that would be enforceable by the federal government and by the state of Utah as well," said Rep. Bobby Scott, D-Va.
By Christopher Smith
The Salt Lake Tribune
WASHINGTON -- The head of a major online casino told Congress on Tuesday that bettors from Utah could be successfully blocked from gambling at Internet casinos, while a Justice Department official expressed skepticism over the effectiveness of the barriers.
The discussion came as a House subcommittee weighed the merits of two bills, one that seeks to prohibit the use of electronic funds transfer for Internet gambling and the other that seeks to study developing a federal licensing and regulatory framework for online wagering.
Utah 3rd District Rep. Chris Cannon supports the latter proposal to regulate Internet casinos, contending the bill prohibiting credit card payments for online wagering could lead to legalized gambling in Utah. Although Cannon didn't attend Tuesday's hearing on the bills, House Judiciary Subcommittee on Crime, Terrorism and Homeland Security Chairman Rep. Howard Coble, R-N.C., asked MGM Mirage Online President Bill Hornbuckle on Cannon's behalf whether technology could permit Internet casinos to block access to computer users from Utah, the only state where all forms of gambling are prohibited.
"No system is perfect but we can deliver with reasonable assurance to the congressman that the folks from Utah, if you didn't want them in, they wouldn't get in," said Hornbuckle, whose Internet casino is based on the Isle of Man in the United Kingdom. The MGM Web site caters only to European bettors by blocking Internet Protocol (IP) addresses from the United States. IP addresses reveal the location of a particular connection to the Internet.
But John G. Malcolm, the deputy assistant attorney general for the computer crime section of the U.S. Department of Justice, told the committee that a "technologically savvy" person could route bets through computers located in other countries and obscure the true IP address to gain access to the cyber gaming host computers.
Justice is supportive of the "Unlawful Internet Gambling Funding Prohibition Act," which would essentially make it illegal to use electronic fund transfers such as credit cards to pay for online gambling. But Cannon helped kill a previous version of the bill last session because he fears it may trump Utah's statutory gambling ban.
"Anytime you carve something out then you make it legal and that bill would essentially make gambling legal in Utah," he said in an interview. "I also have a deep reluctance to mandate what happens in the commercial market, so if we regulate gambling, it's an appropriate way to limit it and preserve the statutes of the state of Utah."
Cannon has joined a bipartisan group of House members pushing the alternative "Internet Gambling Licensing and Regulation Commission Act" that would recognize the widely varying state laws aimed at online gaming.
"Under the regulatory environment this bill provides for, if Nevada opts to allow Internet gambling within its borders it can and if Utah does not opt to allow Internet gambling within its borders it can prohibit it and that would be enforceable by the federal government and by the state of Utah as well," said Rep. Bobby Scott, D-Va.
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