U.S. law against online gambling delayed six months

American online gamblers probably ought to send Christmas cards to U.S. Rep. Barney Frank (D-MA) for his efforts to open up the U.S. online market.

The Boston Globe has reported that Frank secured a six-month delay in a long-expected federal online gambling crackdown on online casinos and poker sites open to American players. Frank told the Globe that he asked for the six-month reprieve so that he and his House colleagues could continue working on revision of the U.S. anti-gaming laws.

Chairman of the House Financial Services Committee, Frank said he doesn’t gamble himself, but that he doesn’t want the federal government invading people’s privacy by telling them what they can or can’t do with their money.

The specific law was intended to go into effect Dec. 1. It would make it illegal for any U.S. credit card company to process charges from online gambling sites. However, in response to Frank’s request and that of the Obama Administration, both the Treasury Department and the Federal Reserve agreed to push back enforcement of the act to June 2010.

Many political observers think Frank’s effort to regulate online gambling is a long shot in 2010, an election year, even though such regulation has the potential to generate as much as $42 billion in tax revenue over the next 10 years.

Gambling opponents are miffed that the feds agreed to the delay. Sen. John Kyl (R-AZ) and Rep. Spencer Bachus (R-AL) contend that online gambling threatens children and teen-agers with gambling addiction. Bachus has said he thinks that any economic benefit from regulating online gambling wouldn’t make up for the hazards of gambling by underage players.

Thus far, individual U.S. gamblers have not been prosecuted by the Justice Department, while online gambling companies operate outside U.S. jurisdiction.

In November, MasterCard announced it would block any online gambling charges including horse racing, which is legal. In response, the congressional delegation from the horse-racing state of Kentucky, home of the Kentucky Derby and dozens of thoroughbred racing horse farms, asked for the new rules to be delayed. MasterCard then rescinded its policy until it can determine what forms of Internet gambling are illegal.