New Jersey Bill Address I-Gaming and Credit Card Debt

The New Jersey state Assembly on Thursday unanimously passed a bill that could put new restrictions on credit card companies that allow cardholders to gamble online.

A3356, authored and co-sponsored by Assemblyman Gary Guear, would make it illegal for credit card companies to collect debt incurred via online gambling.

The bill also states that if any party involved in a transaction is located in New Jersey then the transaction is illegal.

Despite industry concerns over prohibition measures, Keith Furlong, the deputy director of the Interactive Gaming Council, feels the legislation probably won't lead to a renewed prohibition movement in the Garden State.

Furlong, who also works for Catania Consulting Group in New Jersey, said the impetus of the bill is to protect policymakers who want to regulate the industry from criticism by those opposed to the idea.

In early December, Guear introduced legislation to establish a 21-person commission to study the feasibility of New Jersey regulating online casinos and sports books. The bill was passed in the Assembly's Tourism and Gaming Committee and awaits a vote before the full Assembly.

Furlong speculated that the introduction of the credit-card bill preceded the passage of the commission bill because party advisors "probably want to have something black and white in front of them before they put a lot of resources into a study commission."

With the study commission bill having such straightforward language, and a definite deadline for publishing its findings, Furlong feels its potential tasks could be much easier if members have a clear definition of what is allowed in the state.

The credit-card measure, which passed 78-0 in the Assembly, needs approval by the state Senate before it can become law. Furlong said that even if it is passed all the way through, it wouldn't affect the work of the study commission.

"If anything it could help them with their process," he said. "They will want to know exactly what is illegal I-gaming in New Jersey before they move forward with the commission. It would just define the issue before they try to get a grasp of how the state should deal with it."

The Division of Gaming Enforcement has told legislators that it is capable of enforcing I-gaming regulations.

In introducing his bill before the Assembly, Guear warned credit card companies that they "need to realize that they are the ones who are placing a bet if they allow Internet gambling sites to impose runaway charges on card holders."

Furlong also pointed out that current law already states that gambling debts are unenforceable.

The legislation would essentially void the gambling debts of patrons of "illegal" Web sites. It also clarifies that the state has the right to sue Internet gaming sites to recover losses.

Guear was out of his office on Friday and unavailable for comment.

Click here to view a copy of A3356.