The Safe Port Act of 2006

The Security and Accountability For Every Port

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The Security and Accountability For Every Port Act (or SAFE Port Act) was an Act passed by the U.S. Congress in 2006. The Act was concerned with covering port security in the U.S. and online gambling law. Both the House and Senate passed the conference report at midnight on September 30, 2006, the day Congress adjourned for the 2006 elections. President Bush later signed the Act into law on October 13, 2006. The Act put into motion several government programs designed to improve security at U.S. ports. Some of these programs included requirements for maritime facilities such as the Coast Guard, it created the Transportation Worker Identification Credential, established the Port Security grant Program, and set up the Customs trade Partnership Against Terrorism program. In addition, the Act created the Domestic Nuclear Detection Office, a sub-department within the Department of Homeland Security, and created funds toward the Integrated Deepwater System Program which was used by the U.S. Coast Guard.

The underlying idea behind this Act was as a response to the increasing threat of global terrorism. The Act applies to all import shipments coming into the United States and affects all general shippers. The Homeland Security Department was given power by the Act to request additional non-manifest information from any shipper. In other words, it could cause a lot of hassle and problems for the honest shipping company and HSD has the right to demand any information about any shipment coming into the U.S. The Safe Port Act has raised the nation’s level of security in its ports and does have a “green lane” to expedite cargo from shippers that meet the Act’s highest security standards.

The Unlawful Internet Gambling Enforcement Act (UIGEA)

Safe Port Act of 2006 Unfortunately for online gambling, the SAFE Port Act included a bill that is mean to regulate illegal internet gambling. Title VII of the SAFE Port Act is the Unlawful Internet Gambling Enforcement Act and it has absolutely nothing to do with the provisions of the rest of the Act. It is interesting to note that the UIGEA was never voted on in the Senate. The House of Representatives passed it in a 317 to 90 vote but the Senate never debated it. The UIGEA was added to the Act by a committee after Congress passed the bill and before President Bush signed it into law. It is known as a “must pass” bill, much like an appropriations bill, that is critical to the function of government. The UIGEA prohibits the transfer of funds from a bank or similar institute to an online gambling site, with the exception of fantasy sports sites, online lotteries, and online horse racing.

The reaction to the UIGEA has been severe and immense. 24 hours after the bill was passed and signed into law, the publicly traded stocks for the online site PartyPoker dropped 60%. This, with the effect of a tidal wave, wiped out billions of British pounds right off the stock market. In response to that, all online gambling sites with stocks listed on the London Stock Exchange stopped accepting players from the U.S. That forced decision cost these companies and the British stock market severely. Luckily for U.S. players, there are still some non-public online companies that will still accept them (but many of the best and more popular sites will not).

Banks Reaction to UIGEA

Another reaction to the passing of the Act has been from banks and other financial institutes. Banks, credit unions and others have protested about being put in the position of enforcing an unclear law. Further, the enforcement of this new law by financial institutes has been complicated by the difficulty of determining where payments are going and that online gambling businesses can disguise themselves with relative ease.

Some of Congress’ reasons behind the UIGEA, besides political conservatism, are listed in the Act’s findings. According to Congress, internet gambling was a growing problem for debt collections within the United States for insured depositories and was a burden on the collection industry. Also, traditional law enforcement mechanisms were inadequate in enforcing internet gambling, especially when it crossed state and national borders.

Poker Player's Alliance and the UIGEA

Another opposition group to the UIGEA is the Poker Player’s Alliance, or PPA. The PPA is a non-profit coalition of professional and amateur gamblers that united to try to overturn the Act. Their mission is to promote gambling, establish laws to provide safe, regulated places to play, and protect the rights of U.S. players everywhere. The PPA has been a driving force in the opposition of misguided federal laws.

There was some hope for U.S. gamblers. In April 2007, Congressman Barney Frank introduced a bill that would overturn the gambling additions of the SAFE Port Act. According to Congressman Frank, the existing legislation was an inappropriate interference on the personal freedom of Americans. Furhermore, Frank’s bill set up a framework for taxing and regulating online gambling within the United States. Unfortunately his bill was never passed.

Recent UIGEA News

Recently, in these last days of President Bush’s time in office, the Bush administration moved to finalize regulations that would enforce a controversial law with the intent to block Internet gambling. This push drew protests from Democratic lawmakers and supporters of online gambling.
U.S. Congressman Barney Frank, a leading opposition to the UIGEA, asked the administration to postpone the regulation, which had already been reviewed by the White House budget office. Despite all the efforts by opposition to the regulations, the Bush administration finalized the last of the UIGEA regulations that will take effect on January 19, 2009. This eleventh-hour rule making has many protestors upset and the hope is that the new administration will work to overturn these last minute additions.