US Commission Recommendations concerning The Internet Gambling

At first glance, the arguments against Congress’ previous attempts to regulate speech on the Internet may appear relevant to the issue of prohibiting Internet gambling. In reviewing the legal status of gambling, however, federal courts have undermined the contention that the activity of gambling is protected free speech. 62 Because money is exchanged in gambling, it is considered a commercial act and therefore is not subject to the same protections under the First Amendment as pure speech. The U. S. District Court for the District of Rhode Island, in Allendale Leasing, Inc. v. Stone, found that “the commercial act of collecting or raising funds, if it is totally divorced from expression interests, must be subject to reasonable government regulations.” 63 Furthering this position, the U. S. District Court for the District of Connecticut, in Ziskis v. Kowalski, reasoned that “there is no First Amendment right to conduct or play… a game of chance.” 64 Still, free speech issues may remain germane to the discussion if filtering software in ISP’s prevents access to legally posted information on the Internet. 65 65

5.1 The Commission recommends to the President, Congress, and the Department of Justice (DOJ) that the federal government should prohibit, without allowing new exemptions or the expansion of existing federal exemptions to other jurisdictions, Internet gambling not already authorized within the United States or among parties in the United States and any foreign jurisdiction. Further, the Commission recommends that the President and Congress direct DOJ to develop enforcement strategies that include, but are not limited to, Internet service providers, credit card providers, money transfer agencies, makers of wireless communications systems, and others who intentionally or unintentionally facilitate Internet gambling transactions. Because it crosses state lines, it is difficult for states to adequately monitor and regulate such gambling.

5.2 The Commission recommends to the President, Congress, and state governments the passage of legislation prohibiting wire transfers to known Internet gambling sites, or the banks who represent them. Furthermore, the Commission recommends the passage of legislation stating that any credit card debts incurred while gambling on the Internet are unrecoverable.

5.3 The Commission recognizes that current technology is available that makes it possible for gambling to take place in the home or the office, without the participant physically going to a place to gamble. Because of the lack of sound research on the effects of these forms of gambling on the population and the difficulty of policing and regulating to prevent such things as participation by minors, the commission recommends that states not permit the expansion of gambling into homes through technology and the expansion of account wagering.

5.4 The Commission recommends to the President and Congress that because Internet gambling is expanding most rapidly through offshore operators, the federal government should take steps to encourage or enable foreign governments not to harbor Internet gambling organizations that prey on U. S. citizens.

61 American Civil Liberties Union, Et. Al. v. Janet Reno, Attorney General of the United States, No. 98-5591 (E. D. Pa. Feb. 1, 1999) (order granting preliminary injunction). 62 Allendale Leasing, Inc. v. Stone, 614 F. Supp. 1440, 1452-58 (D. R. I. 1985) affd. 788 F. 2d 830 (1st Cir. 1986). 63 Ibid at 1457. 64 Ziskis v. Kowalski, 726 F. Supp. 902, 911-912 (D. Conn. 1989). 65 The American Horse Council, written testimony to the National Gambling Impact Study Commission, Subcommittee on Enforcement, Regulation and the Internet (May 21, 1998).