Online Gambling Prohibition - Bill Takes A Setback - 04-06-06

April 6 - Attempts to ban online gambling too a setback today, and online gambling shares immediately rebounded on the back of the news.  The latest attempt to prohibit online gambling in the US is receiving a lot of opposition

PartyGaming's share price went up shortly after London markets opened, by 9% to 141.5p. Sportingbet also took a big leap, going up by 28p, or 7% to 408.5p. BetonSports was up by 5.75p or 3.85% and were also trading early today at155p. Other shares which saw a positive impact included Neteller, the online payment processor, which was up by  8.7% to 805.5p at one point.

The Internet Gambling Prohibition Act (HR 4777), which is lead by Rep. Robert Goodlatte,  apparently received very little support when it was tabled before a House Judiciary crime sub-committee yesterday.

Rep. Bobby Scott severely criticized the bill as an attempt to create "an enforcement nightmare for financial institutions". First State Bank vice-president seemed to back that comment when Sam Vallanding    ham said the additional burden of monitoring transactions for online gambling would be too difficult for financial institutions.

Industry commentators said that there was a lot of confusion during the sessions relating to the activities which the bill did and did not include. One analyst noted that no vote was taken and that no second hearing had been scheduled. This will probably mean another delay of up to two weeks before the bill is discussed again. 

Opponents of the bill were delighted with the news, especially about the confusion on carve-outs and delays

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