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Gambling/General : Is Internet Gambling A Controversial Subject?

By Elizabeth Scott

Level: Sep 18th 2007
Internet Gambling History

Although online gambling history began in the 90’s, making it a rather recent force, online gambling casinos are a controversial subject. One of the first signpost events that occurred since the online casino gambling became popular, occurred in 1994. Then, the Antigua and Barbuda government passed an online gambling law which allowed online gambling casinos to be licensed there.

The online gambling regulation was called the Free Trade and Processing Act. They were the first who realized the almost infinite potential of making money through the online gambling business and opened the eyes of other entrepreneurs.

Diverse companies were shaped that same year and more continued to be formed in the years that followed, jumping at the now legal chance of making money in the new online gambling industry.

Some entrepreneurs were opening online gambling casinos. Others started designing and improving the software for online financial transactions or for the online casino gambling games. The online gambling industry started to develop quickly then.

In 1998, the number of online gambling casinos started to increase and became a highly profitable business with reported revenues of nearly 835 million dollars. This was the moment when different layers of the U.S government began to take notice.

The first one who was against online gambling was Senator Jon Kyl, a Republican from Arizona. With the purpose of restricting the gambling activity in US he introduced the first laws against online gambling, the Online Gambling Prohibition Act.

His online gambling law failed to gain the support needed in order to pass, and online gambling casinos continued to thrive, probably even moreso because of the media attention it had received courtesy of the senator. So, as I said online gambling casinos continued to flourish, and some corporations came with the great idea of creating software packages that could be leased by online gaming sites for a percentage of their earnings.

At the same time, Canada also began to restrain online gaming businesses, raiding offices and eventually fining one of the largest online gambling servers.

After a year, in 1999, Senator Kyl came with a revised version of his online gambling Prohibition Act, but once again his online gambling bill failed to pass in Congress. Also in 1999, Australia allowed the opening of a licensed online casino and this remains the only one casino allowed. This online casino is currently still in operation but as many others tried to obtain a license, the Australian government quickly formed a online gambling bill preventing any new online gambling operations.

In 2000 another online gambling prohibition bill was turned down in the Congress. The further revised bill was passed by Republican Senator Bob Goodlatte of Virginia.

In 2001, the Republicans won a battle against online gambling creating two bills against online gambling. One of the bills was an updated version of the Wire Act, which makes it illegal for persons to be implicated in the business of betting or gambling. The second bill forbidding establishments based in the U.S. from managing online gambling related payments, making it more difficult for U.S. individuals to engage in online gambling.

Banning online gambling was the result of lawsuits that took place in the years that followed and in 2006 were made a number of arrests of online gambling CEO’s. Also the US government asked for sanctions to be taken against offshore gambling companies - this resulted in great scandal. Antigua and Barbuda filed a case with the World Trade Organization in which it accused the actions taken by the US Government as being discriminatory and unlawful.

In October 2006, the US Congress approved the Unlawful Internet Gambling Enforcement Act and today, many question the means used to pass it.

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