The House Financial Services Committee rejected a bill Wednesday that would delay the implementation of a Federal Reserve Board and Treasury Department regulation to ban Internet gambling.
The bill, which would have required the Fed and Treasury to withdraw the regulation until they could define unlawful Internet gambling, was voted down by voice vote.
The measure was rejected despite adamant support from House Financial Services Committee Chairman Barney Frank, D-Mass., who argued there was no way to limit Internet gambling without defining it first.
"This is really putting the cart before the horse," he said. "We are telling the regulators to come up with regulations before we define what it is the regulations are supposed to accomplish, and we put the financial system at risk."
Legislation that President Bush signed in October 2006 was meant to force banks to block payments to gambling Web sites. The law was supposed to be implemented by regulations nine months later, but the Fed and the Treasury have issued only a proposal, citing the difficulty of finalizing regulations for a vaguely defined activity.