June 1st Deadline For UIGEA Could Cost Americans Thousands Of Jobs

The Unlawful Internet Gambling Enforcement Act is set to take effect in less than two weeks. On June 1st, the rules to the UIGEA will officially be published, and that could mean thousands of Americans will lose their jobs.

While online gambling regulations are being discussed, beginning today in the House Ways and Means Committee, the law will not change before the UIGEA goes into effect. That could lead to website owners, graphic designers, and content providers all losing their jobs when the UIGEA in implemented.

The burden of the UIGEA will fall on the financial institutions. The UIGEA criminalizes the processing of gambling transactions, and the financial institutions will be held responsible for denying the payments.

Many of these transactions have been masked behind business names that have nothing to do with online gambling. That will make it difficult for the banks to figure out which transactions are legitimate and which are not. Luckily for the financial institutions, they must "knowingly process" these transactions to be in violation of the UIGEA.

In the past decade, thousands of websites have been created inside the online gambling industry. They do not all directly deal with allowing gamblers to bet on their sites, but the information contained within these websites have been a driving force behind Representative Barney Frank's attempt to have Internet gambling regulated in the US.

The degree to which the Department of Justice enforces the UIGEA will have a lot to do with the future of the industry. There are some analysts that believe the government will begin making immediate examples of law violators shortly after the UIGEA goes into effect.

Other analysts, however, believe the government will be slow to act on enforcing the UIGEA since Rep. Frank has already proposed legislation to overturn the 2006 law. Rep. Frank has said he will hold hearings on his legislation proposal in July, one month after the UIGEA rules are published.

The government is searching for ways to increase employment opportunities, and regulated online gambling is projected to be the root of billions of dollars and hundreds of thousands of created jobs. With that regulation off in the distance, the immediate reaction to the UIGEA rules could mean the loss of journalist and website jobs within the industry.

Any job loss in the industry will result in the US drifting farther off course from the recovery efforts since the economic recession. The IRS would lose millions of dollars in revenue from income taxes that will no longer be collected with Americans out of work.

Other economic disadvantages will also be seen as a result of the UIGEA. Workers within the Internet industry will have less money to spend in their local jurisdictions, leaving local businesses suffering.

May 19, 2010
Posted By Terry Goodwin
Staff Editor, CasinoGamblingWeb.com
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