Computergram International: Senate Votes To Ban Internet Gambling

Internet gambling faces prohibition after the US Senate voted 90- 10 to add anti-gambling legislation to a "must-pass" spending bill. Sponsored by Republican Senator Jon Kyl, the bill extends an existing ban on betting by wire to internet and interactive casinos. Similar legislation has also been introduced in the House of Representatives. Senators rejected an amendment that would have allowed Indian tribes to continue to offer internet casinos. As with other advocates of prohibition, Kyl maintains that he is the savior of America's youth. "More than a million dollars will be gambled over the internet this year," he said, "children can access internet gambling sites on the family computer, wager with Mom's credit card, click the mouse and bet the house." Understandably, the online gaming industry is up in arms over the proposed ban. A group calling itself the Internet Consumer Choice Coalition and described as a consultant to casino owner Inland Entertainment Corporation (CI No 3,436) has established a web site encouraging net users to oppose the bill. Delaware casino operator Starnet Communications International Inc has gone a step further, assuring investors that it doesn't expect to be adversely affected should the prohibition pass into law. Like most other industry players, Starnet has moved its operations offshore until US and Canadian law can be clarified. Starnet subsidiary World Gaming Services Inc runs out of Antigua, and claims its software can detect a customer's country of origin and reject US and Canadian visitors. Starnet said it plans to continue pursuing gamblers in Europe and Asia, who (unluckily for them) yield higher per capita gambling expenditures that their North American counterparts. So bill or no bill, US investors should still be able to profit from the compulsions of non-US citizens. As for the rest of us, Kyl said his bill will not outlaw fantasy sports leagues, as many feared. Organizations could continue to offer these by charging an administrative fee, providing that fee isn't pooled and offered as prize money.