Justice Department Airs Concerns Over
Proposed Ban on Virtual Casinos
From the Associated Press
June 24, 1998

WASHINGTON (AP) A Justice Department official expressed concerns Wednesday about a bill that would outlaw Internet gambling and subject to prosecution both the bettors who use virtual casinos and those who operate them.

In testimony before the House Justice subcommittee on crime, Deputy Assistant Attorney General Kevin V. DiGregory said the long reach of the Internet into people's homes and across international borders creates special obstacles for law enforcement.

But DiGregory said the Justice Department agrees that the 1961 Wire Communications Act needs to be updated to clarify that it applies not just to sports betting but to "interactive casino betting" as well.

At issue is legislation in both houses of Congress designed to close down a lane of the information superhighway that allows virtual casinos most of them licensed and located in foreign countries to bring gambling to the desktops of willing computer users.

DiGregory said the Justice Department opposes the idea of putting "mere bettors" at risk of prosecution, which the legislation might do.

He also questioned the wisdom of having prosecutors indict operators of virtual casinos who are based legally in other countries.

"A foreign national who is operating a licensed Internet-based casino in his country will not be violating his country's laws if he solicits or accepts bets from United States citizens," he said.

Some lawmakers were taken aback at the Justice Department's apparent reluctance to go after individual bettors and foreigners who might be breaking a new U.S. law.

"I don't quite understand the hesitancy of the department to move into this area," said Rep. Bob Barr, R-Ga.

DiGregory replied that the Justice Department merely advocates "a recognition of the difficulties we will face."

The hearing highlighted several disputes that have slowed the progress of the proposed ban.

Indian tribes, "fantasy" baseball leagues and the horse-racing industry have sought assurances that their activities would not become illegal under the bill, while Internet providers worry they will be assigned the burden of blocking public access to gambling sites on the World Wide Web.

The Senate bill, sponsored by Arizona Republican Sen. Jon Kyl, cleared the Judiciary Committee last fall and could reach the floor this summer.

The House bill still in committee is sponsored by Republican Reps. Bob Goodlatte of Virginia and Frank LoBiondo of New Jersey. It differs from the Senate bill in that it leaves to individual states the final decision on legalizing gambling activities.