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57 Drake L. Rev. 515 (2008-2009)
Highlighting the Drawbacks of the UIGEA: Proposed Rules Reveal Heavy Burdens

handle is hein.journals/drklr57 and id is 519 raw text is: HIGHLIGHTING THE DRAWBACKS OF THE UIGEA: PROPOSED RULES REVEAL HEAVY BURDENS TABLE OF CONTENTS I. Introduction ........................................................................................... 515 II. The Unlawful Internet Gambling Enforcement Act of 2006 ........... 517 A. The Federal Framework Prior to the UIGEA ............................ 517 B. Failed Attempts Leading up to the UIGEA ................................ 523 C. The Enactment and Operation of the UIGEA ........................... 525 III. Problems Associated with the UIGEA .............................................. 528 A. Missed Opportunity: A New Industry and Tax Revenues ........ 529 B. Troubles with Enforceability ......................................................... 531 C. An Inconsistent Stance: At Odds with the Rest of the World..534 IV. Burdens on U.S. Financial Institutions: Problems and Questions Before and After the Proposed Rules ................................................ 536 V . C onclusion ............................................................................................. 544 I. INTRODUCTION Following the failure of several legislative proposals intended to directly address the growing Internet gaming industry, Congress enacted the Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA) in October of 2006.1 Prior to the UIGEA, the legality of Internet gaming activities was primarily governed by a framework of three federal laws.2 Although the Department of Justice maintained that these laws, particularly the Federal Interstate Wire Act, banned Internet gaming, inconsistent court holdings forced Congress to specifically address this growing industry.3 Accordingly, the UIGEA was enacted in the fall of 1. Unlawful Internet Gambling Enforcement Act of 2006, Pub. L. No. 109- 347, § 801, 120 Stat. 1952 (codified at 31 U.S.C. §§ 5361-5367 (2006)). 2. See Federal Interstate Wire Act of 1961, Pub. L. No. 87-216, 75 Stat. 491 (codified at 18 U.S.C. § 1084 (2000)); Travel Act of 1961, Pub. L. No. 87-228, 75 Stat. 498 (codified as amended at 18 U.S.C. § 1952 (2000)); Illegal Gambling Business Act, Pub. L. No. 91-452, § 803, 84 Stat. 937 (1970) (codified at 18 U.S.C. § 1955 (2000)). 3. See 18 U.S.C. § 1084; PeterPaul Shaker, Note, America's Bad Bet: How the Unlawful Internet Gamling Enforcement Act of 2006 Will Hurt the House, 12

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