Mexican lawmakers are pushing to end a 70-year-old ban on casinos in areas
                 frequented by tourists, arguing that they will attract tourists and foreign investors
                 and create jobs. President Vicente Fox is also in favor.

                 The Tourism Commission in the lower house of C ongress is putting the finishing
                 touches on a bill that would legalize casinos, possibly at the next legislative session
                 starting in September.

                 In the 1930s, President Lazaro Cardenas directed Congress to ban gambling,
                 worrying that casinos were dens of organized crime and corruption. But politicians
                 now say that properly regulated casinos would be a sound economic gamble.

                 Casinos in beach resorts, border towns and Mexico City, open to foreigners and
                 Mexicans alike, could generate as much as $1.3 billion in revenue a year, plus an
                 extra $1 billion for the government in taxes and licensing fees, according to
                 estimates prepared for Congress by the National Council of Business and Tourism.

                 But Mexico would need more than $2 billion in investments to build at least 11
                 casinos and accompanying hotels, the council says.

                 Critics say Mexico would have to overcome heavy odds to set up a regulatory
                 system that foreign investors could trust, and make sure that casinos are not used
                 for money laundering.

                 "That's the big thing that Mexico needs to look at, and pass a statute that tightly
                 controls gaming operations," said James Jones, a former U.S. ambassador to
                 Mexico who now represents U.S. gaming businesses interested in setting up
                 casinos here.

                 The proposed law calls for a commission to do everything from issuing licenses to
                 investigating finances. "The law is going to have power," said Jaime Mantecon, the
                 legislator leading the casino effort in Congress. "We want to create a law that
                 doesn't allow for any illegal activity whatsoever."

                 Without tough regulation, says Frank Fahrenkopf, president of the American
                 Gaming Association, "No American licensee is going to take a chance of
                 jeopardizing their license in the States to open a casino in Mexico."

                 But if such a law is passed, plenty of foreign investors are interested, say
                 representatives of the gambling industry in the United States.

                 William Wortman, director of the Nevada Palace Hotel and Casino, has proposed
                 building a gambling complex in Reynosa, Mexico, across the border from McAllen,
                 Texas. The Oneida Indian Nation has expressed interest in Acapulco and Mazatlan.
                 There has been talk of building a casino complex across the border from Laredo,
                 Texas, although no developer has stepped up to take on the project.

                 Mexico and Brazil are the only Latin American countries without resort casinos,
                 said William Eadington, director of the Institute for the Study of Gambling and
                 Commercial Gaming at the University of Nevada, Reno.

                 Last year, more than 19 million foreigners visited the country, spending $8.4 billion,
                 according to Mexico's tourism ministry.

                 Plenty of Mexicans also would line up to play cards and the slots if casinos become
                 legal, especially if they are built in urban areas.

                 Mexico already has a thriving -- but illegal -- gambling industry offering everything
                 from poker to cock fighting. They are estimated to be earning more than $1.6
                 billion a year, and allegedly cheating the government out of more than $900 million
                 in taxes.

                  Copyright 2002 The Associated Press.