News flashed across the wires on Tuesday night that Senator Robert Menendez (D-NJ) had introduced S 3616, the Internet Skill Game Licensing and Control Act. The bill, according to its text, “provides for the licensing of Internet skill game facilities.” The bill, which provides for a full regulatory framework for skill games, is an important piece of legislation and the first introduced in the Senate. However, with the 2008 Congressional session quickly winding to a close, its future is up in the air.
The bill defines an “Internet skill game” to mean one “that uses simulated cards, dice, or tiles in which success is predominantly determined by the skill of the players, including poker, bridge, and mah jong.” This is one of the first bills to be released in the United States Congress that specifically identifies online poker. The Unlawful Internet Gambling Enforcement Act (UIGEA), for example, provides little direction as to what is legal and what is not.
In addition, S 3616 creates a regulatory and licensing framework that makes it “unlawful for a person to operate an Internet skill game facility in interstate or foreign commerce without a license issued to such person.” This imposes a harsh penalty on those who operate under the radar if S 3616 were to become law, but by the same token creates the procedures needed to obtain a license. The multi-page bill describes the criteria needed to be awarded a license as well as the information necessary for full disclosure of applicants, including detailed background checks.
S 3616 allows individual tribal lands and states to opt out if desired. Each entity has 90 days following the passage of the bill to do so. In addition, the bill clearly states that “No provision… may be construed to permit a bet or wager in connection with a sporting league or contest of a sporting league.” This is the third straight new bill to make it illegal to accept online wagers on sporting events. Pete Sessions’ HR 6663 clarified the UIGEA to state that it only applied to online sports betting. Barney Frank’s HR 2046 allowed sports leagues to opt out, although it was revealed in the House Financial Services Committee’s mark up hearing of the bill that the sports leagues themselves did not support it.
Each licensee is required to enact “reasonable safeguards” to ensure against underage gambling, betting in jurisdictions where it is illegal, tax evasion, fraud, money laundering, and problem gambling. Poker Players Alliance Chairman Alfonse D’Amato, himself a former three-term Republican Senator from New York, commented in a press release distributed on Wednesday,
This action by Senator Menendez is yet another example that prohibitions on Internet gambling, and specifically poker, will not work to protect consumers. The PPA has long advocated for thoughtful and effective licensing and regulation of online poker as a means to protect vulnerable communities, such as children and compulsive gamblers, and provide appropriate controls to thwart consumer fraud and abuse. Senator Menendez’s legislation is the right vehicle to achieve those goals.
Menendez was elected to office in 2006 after filling Jon Corzine’s seat earlier that year. The other elected Senator from New Jersey is Frank Lautenberg.
The 2008 Congressional session is quickly winding to a close. In fact, the targeted date of adjournment for the U.S. legislative body was last Friday, September 26th. However, with the recent financial difficulties in the United States, Congress remains in session prior to the general elections in November.
