Internet Gambling Law Threatens Horse Racing

FROM: Cincinnati Enquirer

BY: Rich Muny

When the federal Unlawful Internet Gambling Enforcement Act passed in 2006, the horse racing industry was protected with an exemption. However, it is now clear that this exemption will fail to protect the industry from the harmful effects of the act.
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The act requires blocking of “unlawful” Internet gambling by financial institutions. However, neither the act nor its regulations (as currently drafted) define unlawful Internet gambling. As a result, banks and credit card companies have been deputized to not only enforce this deeply flawed law, but also to define its scope. Unfortunately, the law penalizes banks severely if they err on the side of processing transactions later determined to be unlawful, while permitting them to block perfectly legal transactions. As a result, banks can be expected to err strongly on the side of caution.

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