Online Gambling: Legal?

The article: Despite Crackdown, Online Gamblers Aren't Ready to Fold

The Wall Street Journal posted this article on October 3, 2006. The article addresses online gambling in the United States and whether or not it will remain legal.

According to the article, Congress passed ports legislation in the end of September which included a provision that would forbid Internet casino companies from accepting US financial transactions. In other words, US banks and credit card companies could no longer process payments meant for online gambling.

Currently the United States accounts for 76% of the revenue for the world's biggest online-gambling company, PartyGaming. Other online-gambling companies, which would suffer a loss if the act were signed, are 888 Holdings (which the US generates about half of their revenue) and Sportingbet, both based out of the U.K.

But can this piece of legislation really stop online gambling? According to industry experts the US cannot stop online gambling completely. One of the reasons is due to the private companies who use intermediaries such as Neteller.com. These intermediaries are the companies which transfer money from a bank account to online for a fee. Though this may put a temporary halt to the existing intermediary companies more are likely to spring up in order to compensate and gain market share.

For some gamblers this is means that their leisure activity has been put to rest or is now regulated. For others, they cannotfathomm the thought of online gambling being illegal considering they make their living off of online gambling.
For me, regulating instead of banning online gambling seems more feasible. Instead of imposing compliance costs on financial institutions and banks, it seems it would be more cost effective to place regulations on the process or on the amount of US transactions flowing to foreign online gambling companies.