On the eve of a Congressional hearing on the Unlawful Internet Gambling Enforcement Act to establish what has gone wrong with the Act’s implementation, Eli Lehrer, a Senior Fellow at the Competitive Enterprise Institute, has advanced the case for a complete rethink saying the UIGEA makes ‘almost no financial, social or economic sense’.
In a paper entitled Time to Fold the Unlawful Internet Gambling Enforcement Act, Lehrer condemns the Act as a ‘bad law with perverse outcomes’ – advising its provisions could be harmful to financial transactions unrelated to gambling.
Following close inspection of the UIGEA and implementing regulations that appear ‘vague’ and ‘misleading’, Lehrer proposes that the Act will have ‘enormous — perhaps destructive — consequences’ for America’s banking system, that it will inflict onerous costs onto consumers, could have major unanticipated consequences on non-gambling financial transactions and result in wholesale assaults on the privacy of ordinary American citizens.
‘Even before it considers proposals for the regulation of online gambling, Congress should consider an outright repeal of the Act,’ says Lehrer. ‘The law has very little to do with gambling and serves as a poorly thought-out banking regulation fraught with potentially perverse incentives. Quite simply, it is a bad law. Repealing it makes sense.’
The paper is written in three parts. The first gives an overview of UIGEA’s provisions and the regulations proposed to implement them. The second describes the law and its possible unintended consequences. The paper’s concluding part outlines principles for reforming or eliminating the law. You can read the paper in its entirety here.
Calculators
