Internet gambling bill on hold

A bill to outlaw most forms of Internet gambling appears unlikely to win U.S. Senate passage before senators begin a month-long recess on August 4, two Republican leadership aides said on Tuesday.

They said backers of the legislation were trying to build support for it and resolve differences as the Senate focuses on other legislative matters and gets ready for a summer break.

The bill was not among the priorities outlined by Senate Majority Leader Bill Frist, a Tennessee Republican, during a session with reporters on Tuesday in which he laid out measures he hopes to wrap up before the August vacation.

“I don’t expect it (Senate passage of the Internet gambling bill) to happen in the next two weeks,” one Republican aide said.

“It’s always a possibility, but right now it is not on the schedule,” another aide said.

Backers of the legislation had hoped to swiftly push it through the Senate this month after the U.S. arrest of David Carruthers, the former chief executive of U.K.-listed BETonSPORTS, on charges of racketeering and conspiracy.

The Senate bill is virtually identical to legislation overwhelmingly approved earlier in July by the U.S. House of Representatives. It would prohibit most forms of Internet gambling and make it illegal for banks and credit card companies to make payments to online gambling sites.

The horse racing industry has some concerns with the legislation, one gaming source said.

Sen. Jon Kyl, an Arizona Republican, tried to fast-track passage of the bill in the Senate by getting unanimous consent to approve it but some lawmakers objected, according to sources following the matter.

Kyl told reporters on Tuesday that supporters of the bill are making progress toward resolving the objections. He declined to elaborate.

Congress has relatively few work days left this year because of the congressional elections scheduled for early November. Lawmakers are scheduled to return from vacation in September for several weeks, then adjourn again before the elections, and then return in December.

The Republican-backed bill has been criticized by some as an election-year appeal to the party’s conservative base.

Supporters of a crackdown on Internet gambling say legislation is needed to clarify that a 1961 federal law banning interstate telephone betting also covers an array of online gambling.

Among the priorities listed by Frist were passage of an energy and defense appropriations bills and possibly a military construction appropriations bill and an extension of the estate tax repeal.

(Additional reporting by Jeremy Pelofsky and Peter Kaplan)

© Reuters 2006