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Does anyone with a law degree or legislative/regulatory background believe that the Treasury Department has the right to define unlawful Internet gambling, presumably by analyzing the substantive federal (and state, which is part of the talking points) laws on gambling (which of course have nothing to do with banking), in implementing legislation (the UIGEA) which explicitly stated that its purpose was not to define unlawful Internet gambling? If so, who are they and can they point to an analogous situation where something remotely similar has ever occurred in the history of the United States? IMO it simply can't happen, setting aside the question of why we would want it to.
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Good comments. Thanks. I don't have the background you mentioned, but I'll share my thoughts. First of all, the UIGEA does not state that it does not define Internet gaming. Rather, it states that it does not change the legal status of any Internet gaming (i.e., what was legal still is, and what was illegal still is as well). Check out
http://thomas.loc.gov/home/gpoxmlc109/h4954_enr.xml (UIGEA is at the end).
As UIGEA is supposed to be enforced, it doesn't seem unreasonable for regs to specify what it is banks are supposed to enforce. The regs themselves state that UIG is too hard to define, not that they're prohibited from defining UIG. The PPA lawyers think they're permitted to.
I look forward to the lawyers here commenting on your questions as well.