Casino exec suggests online gambling plan

A Las Vegas casino executive urged Congress to regulate rather than prohibit Internet gambling.

William Hornbuckle, president and chief operating officer of MGM Mirage, criticized a bill by Rep. Jim Leach, R-Iowa, that seeks to ban Internet gambling by outlawing the use of credit cards, wire transfers or any other bank instruments to pay for online bets.

(The Leach bill) will do nothing to protect (Internet gambling) consumers, Hornbuckle told the House Judiciary subcommittee on crime, terrorism and homeland security.

By eliminating all regulating by credible financial institutions, you have encouraged an e-commerce market that is ripe for money laundering, Hornbuckle said.

Leach, who also appeared at Tuesday’s hearing, disputed Hornbuckle’s claim.

When they say there is no consumer protection, the ultimate consumer protection is when the consumer will not have to pay Internet gambling debts if he cannot use the financial instruments, Leach said.

MGM Mirage has been perhaps the most aggressive brick-and-mortar casino to explore the Internet gambling market. After receiving an online gaming license from the Isle of Man in September, MGM Mirage has collected Internet bets from 10 countries.

The United Kingdom is MGM Mirage’s chief online market and the other countries are located primarily in Western Europe. The casino does not accept online bets from the United States, Hornbuckle said.

Instead of the Leach bill, Hornbuckle said, Congress should approve an alternative offered by Rep. John Conyers, D-Mich., that would create a federal commission to study the feasibility of regulating Internet gambling.

Rep. Howard Coble, R-N.C., the committee chairman, asked Hornbuckle if MGM Mirage could block a resident of Utah, which does not allow any form of legalized gambling, from wagering online.

Hornbuckle said MGM Mirage has developed a software system that is 99.9 percent effective in blocking customers from states and countries that ban Internet gambling.

No system is perfect, but we can deliver with reasonable assurance … that folks from Utah … would be prohibited, Hornbuckle said.

So far, Leach’s bill has 34 co-sponsors. Conyers’ bill has three co-sponsors, including Rep. Shelley Berkley, D-Nev. Neither of Nevada’s other two House members — Republicans Jim Gibbons and Jon Porter — has co-sponsored either bill.

The subcommittee is expected to vote within the next two weeks on whether to approve either the Leach or Conyers bill or a hybrid of the two. The measure would then advance to the full Judiciary Committee.

If the Judiciary Committee passes an Internet gambling bill, House GOP leaders will have to decide whether to send that bill to the House floor or the Leach bill, which passed the House Financial Services Committee by voice vote on March 13.

Meanwhile, a bill by Sen. Jon Kyl, R-Ariz., that closely tracks the Leach bill awaits a vote by the Senate Banking Committee.

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