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It's an illegal, multibillion-dollar industry that attracts millions of Americans, most of whom apparently have no idea they are breaking US law.

Online gambling generated around $15-billion (about R102-billion) globally in 2005 - a five-fold increase from 2001 - and is projected to reach $25-billion by the end of the decade.

The US Department of Justice insists such activity violates 1961 legislation called the Wire Act, which was aimed at organised crime and outlaws the use of phone lines to place bets across state lines.

Despite the law, online gambling by US residents is growing at an estimated rate of 20 percent per year and totalled around four billion dollars last year.

Because of the threat of prosecution against betting website operators, nearly all that money went to offshore sites, may of them in Costa Rica and Antigua.

In a bid to crack down on the offshore problem, the US House Judiciary Committee approved two bills last month.

One sought to prevent the use of payment instruments such as credit cards and fund transfers for online gambling, and the other to expand the Wire Act to cover all games of chance, such as poker and blackjack.

"Illegal online gambling doesn't just hurt gamblers and their families, it hurts the economy by draining dollars from the United States and serves as a vehicle for money laundering," said Bob Goodlatte, a Republican congressman and author of one of the bills.

"It is time to shine a bright light on these illegal sites and bring a quick end to illegal gambling on the Internet," Goodlatte said.

According to a recent survey by the American Gaming Association (AGA), fewer than one in five US online gamblers realise - or are willing to admit to pollsters - that what they are doing is illegal here.

The survey also offered a profile of the average Internet gambler as someone younger, better educated and more affluent than the patrons of the traditional bricks-and-mortar casinos.

The AGA is wary of the legislation pending in Congress, arguing that it will have little impact, as operators are likely to find a way to continue serving their customers.

"If, in the end, what we're concerned about is protecting US citizens, protecting minors, protecting pathological gamblers, wouldn't it be better to try to license, regulate and tax it here, rather than allow these regulated sites to operate offshore?" said AGA spokeswoman Holly Thomsen.

June 19, 2006
Posted By Michelle Johnson
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