No 1 in Gambling

The Act was passed on the last day before Congress adjourned for the 2006 elections. According to Sen. Frank Lautenberg (D-N.J.), no one on the Senate-House Conference Committee had seen the final language of the bill before it was passed.^[1][2] The Economist has written that these provisions were "hastily tacked onto the end of unrelated legislation".^[3]

Though a bill with the gambling wording was previously debated and passed by the House of Representatives,^[4][5][6] the SAFE Port Act (H.R. 4954) as passed by the House on May 4 and the United States Senate on September 14,^[7] bore no traces of the Unlawful Internet Gambling and Enforcement Act that was included in the SAFE Port Act signed into law by George W. Bush on October 13, 2006.^[8] The UIGEA was added in Conference Report 109-711 (submitted at 9:29pm on September 29, 2006), which was passed by the House of Representatives by a vote of 409-2 and by the Senate by unanimous consent on September 30, 2006. Due to H.RES.1064, the reading of this conference report was waived.

Among the Congressional supporters of the Act were Jim Leach, a former chairman of the House Banking Committee and Rep. Robert Goodlatte [R-VA], who co-authored H.R. 4411 (the Internet Gambling Prohibition and Enforcement Act). Bill Frist, former majority leader of the Senate, and Jon Kyl are both credited with expediting the UIGEA's passage through the Senate. Though the SAFE Port Act's provisions related to Internet gambling were drawn exclusively from H.R. 4411, significant portions were removed, including text relating to the Federal Wire Act.^[9]

The Internet Gambling Prohibition Act, a prior version of the gambling part of the bill passed the House in 1999 but failed in the Senate in part due to the influence of lobbyist Jack Abramoff.^[10]

UIGEA § 5364 required that regulations be issued by the Federal Reserve and the Department of the Treasury within 270 days of the passage of the Act. In October, 2007, these agencies issued a "Notice of Proposed Rulemaking",^[11] which effectively tabled draft UIGEA regulations for public comment. In response to the NPRM, four hundred and ten (410) responses were received from depository institutions, depository institution associations, public policy advocacy groups, consumers, “gambling-related” entities, payment system operators, federal agencies, and members of Congress.

The Bush administration had previously adopted the position that it would not finalize any rule subsequent to November 1, 2008. This last-minute rulemaking that binds the hands of an incoming administration is commonly termed the midnight drop.

The final regulations (termed the "Final Rule") were finalized and released November 12, 2008, and came into effect on January 19, 2009, the day before the Obama administration took office.^[12] Compliance was not required until December 1, 2009 in order to give the "non-exempt participants" an opportunity to implement the necessary safeguards and procedures.

References

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