Tech Daily Dose

House Financial Services Committee ranking member Barney Frank, D-Mass., has found a new partner in his quest to legalize Internet gambling and to reverse a 2006 law that outlawed it.

Rep. John Campbell, R-Calif., plans to introduce with Frank a similar version of legislation the Massachusetts Democrat helped push through the Financial Services Committee in the last Congress. Unlike in the last Congress when he was chairman of the committee, Frank said Campbell will be the lead sponsor of his bill this year.

The measure approved by Financial Services in the last Congress aimed to counter a 2006 law that prohibited most online gambling and barred banks, credit card companies and other payment processors from processing payments for online bets.

Frank's bill would have allowed for online gambling in states where it's permitted now and set up a regime to regulate it. A companion bill was introduced in the 111th Congress by Rep. Jim McDermott, D-Wash., that would have established a system for taxing online gaming, but that measure also died in the last Congress without any action beyond a hearing on the issue.

Supporters of legalizing, regulating and taxing Internet gambling argue the 2006 law has done little to deter the millions of Americans who already gamble online through sites based offshore. They say the bill would implement much needed consumer protections, while bringing in billions of dollars in tax revenues over the next decade.

"Clearly the prospect of new revenue has helped to draw attention to this opportunity," said Michael Waxman, who heads a group that backs legalized online gambling called the Safe and Secure Internet Gambling Initiative, in referring to the budget woes facing many states and the federal government. "I think it could help to get it over the finish line."

A spokesman for Campbell, who also sits on the Financial Services Committee and supported Frank's bill in the last Congress, said the lawmakers have not set a date for when the bill will be introduced because they are still hammering out some last details, such as what committee they want it to be referred to.

The current chairman of the Financial Services Committee, Spencer Bachus, R-Ala., staunchly opposed Frank's bill. Bachus and other critics argue that it would make it easier for children and addicts to gamble, driving up social costs that would far outweigh any of the tax benefits.