Among Internet gamblers, it's an article of faith that the government can never shut down online casinos. Sounding much like MP3 downloaders who defy record companies to stop them from trading music, gamblers say that the Internet is too vast, too fluid and too international to prevent any site from offering games of chance in return for money. "They can't do anything about it," said Damian Dunlap, a real estate broker in Los Angeles who was one of few Internet gamblers willing to talk to Salon on the record. "What are they going to do? Unless they start checking everybody's computers, and they can't do that."

The Leach-LaFalce bill doesn't say anything about checking people's computers. Its main function is to prevent American financial firms from paying casinos -- but it also outlines a thicket of exemptions and exceptions to the rule, actually creating a class of "lawful" Internet gaming sites in the process, and not offering a clear definition of what's legal and what isn't. Because of these caveats, it was the sort of legislation that virtually everyone could agree on: It passed by a voice vote, earning the unlikely support of both the Christian Coalition and the National Thoroughbred Horseracing Association (the former supported the bill in the belief that it would stop betting online; the latter in the belief that it would not).

But Dunlap, the gambler in Los Angeles, and several other regular players pooh-poohed the idea that the government could stop gambling by outlawing payments to gambling sites. "Now they have Neteller," he said of gambling sites. "You can even send your check in. The government can't stop that."

Neteller, an online payment system that's a virtual clone of PayPal, but which is based in Canada and not subject to U.S. law, is another article of faith among online players. There are now several Neteller-type systems based all around the globe, and Americans can freely transfer funds to those accounts, which can then be transferred to online casinos. To hear American gamblers tell it, these systems guarantee that betting online will forever remain free of impediments.

The truth is somewhat more complicated, though. Just as the record companies couldn't shut down all the file-trading apps but could make file trading more frustrating, it appears that authorities who've gone after "financial instruments" used for online gambling have had some success. This year, Eliot Spitzer, New York state's attorney general, has pressured many credit card companies to block payments to Internet betting, which -- by court decision -- is explicitly illegal in New York. In March, Spitzer also managed to get PayPal to stop letting New Yorkers pay online casinos. And when eBay announced plans to purchase PayPal in July, the company said that it would cease to do business with casinos altogether.

"And that caused the [online gambling] industry to really go through a contraction," says C.M. Booth, the director of marketing at bet2gamble.com, a site that rates and reviews online casinos. "The end of the credit card payment method has really put the hurt on them."

But the contraction may be only temporary, as gamblers and gambling sites scramble for alternatives. There's an undeniable demand for Internet casinos, and gamblers say they're finding all sorts of unregulated payment systems to get around the PayPal and the credit card ban -- a fact which should alarm lawmakers, some of whom have expressed concern that Internet casinos may be used to aid organized crime and terrorists.

The specter of casino-financed terrorism was first raised by Rep. Michael Oxley, R-Ohio, and Dennis Lormel, chief of the financial crimes section of the FBI, at a House hearing not long after Sept. 11, 2001.

"We've heard from law enforcement officials that there's a link between offshore Internet gambling, and money laundering," Oxley said. "A lax regulation of offshore Internet gambling operation would seem to lend itself to the possibility that large amounts of terrorists' funds could be laundered through these sites with relative impunity. What are your comments in that regard?"

Lormel responded that Oxley's scenario was a "possibility." Sept. 11's hijackers, he said, "certainly exploited our system as well as they could. So it certainly is a concern and we certainly should be vigilant in monitoring that. And certainly, beyond the terrorism, the network of enterprises that certainly do exploit that particular area is something we must look at."

Lormel said that, at that time, the FBI had two pending investigations in "our organized crime side of the house" looking into money laundering through online casinos. He did not detail the specifics.

Could the mob or al-Qaida be using online casinos and payment systems to transfer funds? Many gamblers say that these are, at best, alarmist hypotheses; there's no proof -- at least no public proof -- that it's occurring. But if evil people did want to use these systems for evil ends, they'd probably find the current, freewheeling atmosphere -- where everything is illegal and nothing is monitored -- more accommodating than a closely watched environment.

"We already see the beginning of an 'arms race' of alternative payment processors targeting the gambling market," said Mike Craig, co-owner of the Online Players' Association, a group of online gamblers and casinos. "Many are not regulated as financial institutions. The effect of this particular bill is to give a boost to the industry of anonymous and unregulated international electronic money transfer." The Leach-LaFalce bill, Craig added, could end up making money laundering easier than ever before.

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