Proposed Comments

[JPFisher55]

I thought that it would be a good idea to have a thread devoted to proposed comments. So I will post my first two proposed comments.

The first comment concerns opposition to the creation of a list of UIG businesses.

Jennifer J. Johnson
Secretary, Board of Governors of the Federal Reserve System
20th Street and Constitution Avenue, N.W.
Washington, DC 20551

Dear Secretary Johnson,
"Under II. E. 6. of Supplementary Information to the proposed PROHIBITION ON FUNDING OF UNLAWFUL INTERNET GAMBLING, the agency requests comments on the feasibility of creation of a list of unlawful internet gambling businesses. In my opinion, the creation of such a list is not practical or judicious.
Under the UIGEA, the term unlawful internet gambling is essentially defined as any internet gambling that violates any applicable state or federal law. However, the power to interpret state or federal laws is granted to the judiciary branch of government; not to the executive. So how can any government agency determine whether any business is engaged in unlawful internet gambling? Interpretation of the laws affecting internet gambling of all 50 states and the federal government and applying these laws to determine which businesses are violating them would place any agency in the position of being judge and jury for any potential business.
Besides being extremely costly, I believe that any such judgment should be left to the judiciary branch and not any government agency. Without some judicial ruling about any business engaged in internet gambling how can an agency insure that such business is engaged in unlawful internet gambling?
In my opinion, the Agencies discussion about the difficulties of creating a list of businesses engaged in unlawful internet gambling is correct. In my opinion, the Agencies cannot establish, maintain and update such a list."

Sincerely
JPFisher55

TE, and others, let me know what you think. Also, anyone feel free to copy or other use this comment.

[JPFisher55]

This is my comment with a proposed definition of the term "unlawful Internet Gambling." It is not an alternative to TE's proposed comment on overblocking by banks. They could be separate comments or could be combined.

Jennifer J. Johnson
Secretary, Board of Governors of the Federal Reserve System
20th Street and Constitution Avenue, N.W.
Washington, DC 20551

Dear Secretary Johnson,

I cannot understand how the UIGEA or your proposed regulations can be enforced or interpreted without defining the term “unlawful internet gambling.” Surely, your agency does not intend for a bank to have to define this term. Yet, how can a bank know if any transaction is restricted under the UIGEA and the regulations without defining this term. In fact, unless a definition of unlawful internet gambling can be established, I believe that the UIGEA and its regulations are so vague that they could not be enforced under the US constitution.

Under federal case law, In Re MasterCard International Inc., 313 F.3d 257 (5th Cir. 2002) and other cases, the Wire Act covers sports betting only (excluding horse racing per the Interstate Horse Racing Act). Additionally, the Professional and Amateur Sports Protection Act of 1992 covers interstate (and, in 46 states, intrastate) professional and amateur sports betting. Since federal case law holds that the Wire Act only covers sports betting, then, for the application under federal law, the term unlawful internet gambling should only include all internet sports betting except for horse racing as defined under the Interstate Horse Racing Act.
Very few states have expressly outlawed Internet gambling. For application under state laws, to keep from placing an unfair burden on our banks, in defining the term unlawful internet gambling, the regulations should specify that state laws must contain a provision that uses the term internet gambling and expressly states that all internet gambling is unlawful, or other similar language or expressly states the specific forms of internet gambling banned by that state. Additionally, states wishing to have federal assistance in enforcing their Internet gambling restrictions should be required to request this assistance from the Treasury Department. This will enable our banks to have a clear understanding of what it required of them.

Thus, I recommend that unlawful internet gambling is defined to mean accepting, receiving or otherwise knowingly transmitting a bet or wager by any means which involves the use, at least in part, of the Internet where such bet or wager (1) involves, or is related to, a sporting event or sporting contest; except for horse racing, (2) involves, or is related to, a game of chance, contest, card game or other event that a statute of the state in which the bank resides expressly prohibits the use of the Internet to place, receive or otherwise transmit such bet or wager or (3) involves, or is related to, a game of chance, contest, card game or other event, and the state in which the bank resides expressly prohibits, by statute, all Internet gambling.

If your agency does not feel that it has the power to define the term unlawful Internet gambling, then I suggest that you use the following non-exclusive examples.
1. In any state, accepting, receiving or otherwise knowingly transmitting a bet or wager by any means which involves the use, at least in part, of the Internet where such bet or wager involves, or is related to, a sporting event or sporting contest; except for horse racing is unlawful Internet gambling.
2. Accepting, receiving or otherwise knowingly transmitting a bet or wager by any means which involves the use, at least in part, of the Internet where such bet or wager involves, or is related to a game of chance, card game, casino or other contest that does not involve a sporting event or sporting contest is not unlawful Internet gambling unless (1) the state in which the bank resides expressly prohibits, by statute, all Internet gambling or (2) the state in which the bank resides expressly prohibits, by statute, a bet or wager by use of the Internet on the particular game of chance, card game, casino or other contest that such bet or wager involves or relates.
Sincerely,

Please feel free to copy or use this comment in any manner that assists our efforts.

[Coy_Roy]

[ QUOTE ]
This is my comment with a proposed definition of the term "unlawful Internet Gambling." It is not an alternative to TE's proposed comment on overblocking by banks. They could be separate comments or could be combined.

Jennifer J. Johnson
Secretary, Board of Governors of the Federal Reserve System
20th Street and Constitution Avenue, N.W.
Washington, DC 20551

Dear Secretary Johnson,

I cannot understand how the UIGEA or your proposed regulations can be enforced or interpreted without defining the term “unlawful internet gambling.” Surely, your agency does not intend for a bank to have to define this term. Yet, how can a bank know if any transaction is restricted under the UIGEA and the regulations without defining this term. In fact, unless a definition of unlawful internet gambling can be established, I believe that the UIGEA and its regulations are so vague that they could not be enforced under the US constitution.

Under federal case law, In Re MasterCard International Inc., 313 F.3d 257 (5th Cir. 2002) and other cases, the Wire Act covers sports betting only (excluding horse racing per the Interstate Horse Racing Act). Additionally, the Professional and Amateur Sports Protection Act of 1992 covers interstate (and, in 46 states, intrastate) professional and amateur sports betting. Since federal case law holds that the Wire Act only covers sports betting, then, for the application under federal law, the term unlawful internet gambling should only include all internet sports betting except for horse racing as defined under the Interstate Horse Racing Act.
Very few states have expressly outlawed Internet gambling. For application under state laws, to keep from placing an unfair burden on our banks, in defining the term unlawful internet gambling, the regulations should specify that state laws must contain a provision that uses the term internet gambling and expressly states that all internet gambling is unlawful, or other similar language or expressly states the specific forms of internet gambling banned by that state. Additionally, states wishing to have federal assistance in enforcing their Internet gambling restrictions should be required to request this assistance from the Treasury Department. This will enable our banks to have a clear understanding of what it required of them.

Thus, I recommend that unlawful internet gambling is defined to mean accepting, receiving or otherwise knowingly transmitting a bet or wager by any means which involves the use, at least in part, of the Internet where such bet or wager (1) involves, or is related to, a sporting event or sporting contest; except for horse racing, (2) involves, or is related to, a game of chance, contest, card game or other event that a statute of the state in which the bank resides expressly prohibits the use of the Internet to place, receive or otherwise transmit such bet or wager or (3) involves, or is related to, a game of chance, contest, card game or other event, and the state in which the bank resides expressly prohibits, by statute, all Internet gambling.

If your agency does not feel that it has the power to define the term unlawful Internet gambling, then I suggest that you use the following non-exclusive examples.
1. In any state, accepting, receiving or otherwise knowingly transmitting a bet or wager by any means which involves the use, at least in part, of the Internet where such bet or wager involves, or is related to, a sporting event or sporting contest; except for horse racing is unlawful Internet gambling.
2. Accepting, receiving or otherwise knowingly transmitting a bet or wager by any means which involves the use, at least in part, of the Internet where such bet or wager involves, or is related to a game of chance, card game, casino or other contest that does not involve a sporting event or sporting contest is not unlawful Internet gambling unless (1) the state in which the bank resides expressly prohibits, by statute, all Internet gambling or (2) the state in which the bank resides expressly prohibits, by statute, a bet or wager by use of the Internet on the particular game of chance, card game, casino or other contest that such bet or wager involves or relates.
Sincerely,

Please feel free to copy or use this comment in any manner that assists our efforts.

[/ QUOTE ]


That's pretty good.

[oldbookguy]

Excellent, you might want to work in the Humphries / N.J. case as well that determined 'contests' were not in violation of any gambling laws per say.

obg

[DeadMoneyDad]

[ QUOTE ]
This is my comment with a proposed definition of the term "unlawful Internet Gambling." It is not an alternative to TE's proposed comment on overblocking by banks. They could be separate comments or could be combined.

[/ QUOTE ]

Right now I think IMPO that attempting to defeat the rule completely is or should be the thrust of our initial comments. I don't see any value in helping the Gov't write a better rule that may or may not include language that helps poker.

IMPO we might give that a shot later on if and only if it looks like from reviewing the commnets and reaching out to people in the process if we thought the Agencies were going to try to re-write the rules with better language.

IMPO at least for now the best attack is to show how unworkable and possibly un-constitutionl any attempted regualtion would be no matter how well written any proposed regulation would be.



D$D

[JPFisher55]

D$D, I agree with you. However, the "Agencies" cannot just abandon the regulations as hopeless even though the entire UIGEA is hopeless. They do not have the power. That is why we have courts of law.
But they do have the power to adopt regulations that might be better for us online poker players. To be honest, I warned TE that I did not think that all our comments will matter. I think that the regulations are deliberately vague so that the DOJ and Treasury can intimidate the banks like they have online gambling entities. The Agencies want to see "overblocking" by the banks.
The real reason that the Agencies will not create a list of UIG businesses is that any listed business would clearly have standing to sue and one loss by the government might unravel their entire campaign against online gambling.
However, TE stated that we have to try anyway. I agree, so I will give it my best effort. My definition of UIG and/or my examples would benefit online poker players in most states. Also, I think that no so-called black list is, at present, best for our side.

[MiltonFriedman]

You write "IMPO we might give that a shot later on".

There is no "later on" for comments, THIS is the opportunity to comment.

Fire all your guns now, if there is a litigation effort "later on", you would want to have comments in the record to support your claims.

[Skallagrim]

JP - these are great comments. I think there can be some changes and some improvement (e.g., I think you should explain why a bank should only have to follow the law of the state its in - namely, it would be far too expensive to know the law of every state).

I just have been too busy on my real job to, so far, make the touch-ups I think could help. May take me till the weekend to really get going here, sorry. But while I think i can add some value, I also think everyone else can add some value here too.

JP has given us a great first comment, lets now work to make it even better.

Skallagrim

PS D$D, JP's proposal's are clearly better FOR POKER than the current regulations. They also make it even easier for banks to comply without disrupting the play from MOST states. There is not much we can do in those other few states through the regulations.

[HelloandGoodby90]

I worry that by pushing for more specific regs.

A. We risk completely shutting down poker until any lawsuit may happen, because the banks have a set of specific rules outlawing poker, to go off of.

B. The sites are going to pull out of the areas they are not allowed to operate in "by law." States, or perhaps the entire U.S.

C. SOOOO many states are going to realize they need internet gambling laws, and start passing them, banning poker.

Now, it is entirely possible, that the sites will continue to ignore any U.S. laws, and operate as usual. I hope that happens. But, we risk the banks not allowing them to operate, thanks to tougher enforcement.

I guess I have a few questions. Many people on these boards want tougher, more specific regs.

1. Do we risk the sites pulling out of the U.S., or pulling out of certain parts of the U.S., due to the tougher regs?
2. Do we risks state's realizing that they need internet gaming laws, thanks to the more specific regs?
3. Do we risk the FR and DOT, writing such specific regs, that poker is hurt? (I suppose that means we can sue)

I hate to break up the status quo. Right now, I live in the United States, in a state where it is a felony to play online poker. I am still able to play if I wanted, although I don't. I hate for that to change.

[Adebisi]

I didn't read all of these comments but IMO, the best way to really take the teeth out of the UIGEA would be to create a private cause of action against the banks for any customer who has a transaction wrongfully declined. If a person had a transaction to a non-illegal gambling company denied, and could prove it, the bank would have to pay him $2500 or something like that.