WASHINGTON -- Regulations to enforce an Internet gambling ban would be blocked under a bill introduced this week by Rep. Barney Frank, D-Mass., chairman of the House Financial Services Committee.
"These regulations are impossible to implement without placing a significant burden on the payments system and financial institutions," Frank said in a statement on Friday.
Frank's bill, which is co-sponsored by Rep. Ron Paul, R-Texas, was introduced Thursday and would prohibit the Department of Treasury and the Federal Reserve from proposing regulations to enforce the Internet gambling ban enacted in 2006.
During a financial services subcommittee hearing last week, regulators from the Department of Treasury and the Federal Reserve acknowledged they are struggling to form rules to enforce the ban because the 2006 law does not clearly define unlawful Internet gambling.
The hearing also included testimony from representatives of banks and other financial agencies who complained the ban would force them to review substantially more transactions. They said this could interfere with the processing of other transactions that are legal.
Even those who support the ban ought to be concerned about the effect of the regulations, Frank said.
Susan Staywick, a spokeswoman for the Federal Reserve, said the agency "does not comment on legislation."
Calls to the Department of Treasury and Rep. Spencer Bachus, R-Ala., who sponsored the ban, were not returned.
Paul said the Internet gambling ban "infringes upon two freedoms that are important to many Americans: the ability to do with their money as they see fit, and the freedom from government interference with the Internet."
"This is another pernicious trend that has accelerated in the aftermath of the Patriot Act, the deputization of private businesses to perform intrusive enforcement and surveillance functions that the federal government is unwilling to perform on its own," Paul said.
Frank spokesman Steven Adamske said the committee has not yet scheduled a hearing on the bill to block regulations to enforce the Internet gambling ban.
Another bill Frank introduced in April 2007 would repeal the ban and require the Department of Treasury to regulate legalized Internet gambling in the United States. So far, this bill has 48 co-sponsors.
A bill by Rep. Shelley Berkley, D-Nev., calling for a one-year study of Internet gambling by the National Research Council of the National Academy of Sciences has 70 co-sponsors.
Already a co-sponsor of Frank's bill to roll back the ban, Berkley announced Friday she plans to co-sponsor his bill against Internet gambling ban regulations.
"I opposed this unfair law when it was passed, and I fully support Chairman Frank's legislation to stop these burdensome regulations before they ever go into effect," Berkley said in a statement.
Jeff Sandman, a spokesman for the Safe and Secure Internet Gambling Initiative, also applauded Frank's efforts to block the regulations.
"It's a bold move, but a necessary one in light of the warnings from the Treasury and Federal Reserve that they did not know how to write regulations to solve the problems created by (the Internet gambling ban)," Sandman said in a statement.