A very good breakdown of the bill

[Jay Cohen]

This is from a respected poster at the Rx:

A section by section breakdown of the Gambling Bill with commentary.....
I am going to attempt to decipher the Legislation passed last night by disecting the bill itself. Keep in mind – I am not a legal expert – I am just a normal guy who has read the bill 10 times and am going to take a stab at clarification.

The bill that pertains to gambling starts on page 213 of this document and runs through page 244. Use that document as reference.

The law is has subchapters 5361 through 5367.

5361: deals with the reasons congress felt the need to do this. It is short – runs through line 17 of page 214.

5362: definitions of terms to be used in the bill.
It defines:
1. Bet or Wager on pages 215 through line 11 on page 219. This is where they carve out horse racing and lotteries etc.
2. Business of Betting or Wagering on line 12 of page 219. This is defining a sportsbook or poker site or online casino.
3. Designated Payment System on line 17 of page 219. This is the method (such as EFT) by which a transfer of funds can be made.
4. Financial Transaction Provider on line 4 of page 220. This is your neteller, cc’s, WU, banks etc.
5. Internet on line 15 of page 220. We all know what the internet is – congress probably doesn’t.
6. Interactive Computer Service on line 18 of page 220. This is a tricky one and a very important one. I have been told that this is not ISP’s, but this is companies that own servers. The importance is coming later in the document.
7. Restricted Transactions on line 1 of page 221. Self explanatory.
8. Secretary and State.
9. Unlawful Internet Gambling that starts on line 13 of page 221 and runs through line 2 of page 228. 7 pages are devoted to spelling out this definition. This is where it says that betting on poker or sports is different than betting in a casino or horse racing. Very long, but pretty straight forward.
10. Other terms that starts on line 3 of page 228 and runs through the end of page 229. This defines credit cars, efts etc – obvious stuff.

5363: Describes the prohibition on ACCEPTANCE of any financial instrument for unlawful internet gambling (see definition above). This is the meat of the bill and is only about one and a half pages long. It says that no person engaged in the business of betting (bookmaker) may accept:
1. Credit including cc’s
2. An eft.
3. Check, draft, or similar instrument
4. Any proceeds (a catch all)


5364: Policies and procedures to identify and prevent restricted transactions.

A. Regulations: On line 7 of page 231 it states that there will be a 270 day period where a board including the Federal Reserve System and the Attorney General will prescribe regulations for which the banks and payment processors need to follow.

The goal of these policies and procedures is outlined on page 232 and they are basically saying that they need to identify and block the transactions and give the operators a procedure to follow.

B. Requirements for Policies and procedures. On line 12 of page 232 they talk about the requirements of this board to come up with procedures.

C. Compliance: Line 19 page 233. Talks about when operators of financial transactions are in compliance.

D. No liability for blocking or refusing transactions: Line 16 page 234. This one scares me a little. It basically said that the operator (your bank) cant be held responsible for blocking a transaction if they think it is gambling related.

E. Regulatory enforcement. Line 10 page 235. Which govt agencies will enforce this.


5365: Civil remedies. Line 3 page 236.

This subchapter is devoted to how the Govt courts and Attorney General may enforce the law.
Jurisdiction.
Proceedings. Line 11 page 236. This talks about the procedures of how an attorney general can prosecute. Seems like pretty standard stuff and nothing unique to this bill.
Limitation relating to Interactive Computer Services. Line 1 page 239. This is a key section and it all comes down to the definition of “interactive computer services”. In subparagraph A, line 6 page 239, it states that disabling access and removing links to online sites is necessary THAT RESIDE ON A COMPUTER SERVER THAT SUCH SERVICE CONTROLS AND OPERATES. From what I understand, this means hosting services, not ISP’s. So if a US company is hosting Pinnacle, they have to stop and not provide access. This is yet to be clarified and I am not ruling out that this includes ISP’s, but it is my opinion right now that it does not include ISP’s.
Limitations on injunctions against regulated persons. Line 5 page 241.
5366: Criminal penalties. Line 15 page 241.

This goes through the penalties for the PROVIDER if they are in violation.

5367: Circumventions prohibited. Line 4 page 242. This basically redefines that if you are in the business of taking bets, this law applies to you.

In conclusion, this is my opinion of how this will effect the average gambler:
Neteller might go away. It will be their choice, but they may decide not to take American Customers. They are not subject to this law as they are a foreign based banking operation – but they might abide by it.
There is a 270 day period to figure out how to enforce it. Right now there is no way because there is no coding of EFT’s. It is possible that they might not even find a way to do this or it might be too expensive.
Nothing in this bill criminalizes your behavior as the bettor.
Nothing in this bill criminalizes you if you are not a bookmaking operation and you send or receive payments.
The responsibility is on US banking, payment processors, and epayment services to stop this.
American hosts of illegal gambling websites will have to stop. I do not believe that ISP’s have anything to do with this and there will be no attempt to block pinnacle from getting to your computer.

Please remember. I am just a normal guy who has read this thing 10 times. I am not a legal expert. But the language is written very clearly in most places and I don’t think there is anything I am misinterpreting or misunderstanding.

[fsuplayer]

more good news about IP's at least.

[JPFisher55]

I am an attorney and I agree with this analysis. I doubt that Neteller or Firepay will voluntarily cancel 70+% of their business.
For the player not much will change. For the poker professional receiving endorsement dollars or media like Cardplayer receiving ad dollars, alot will change. I predict lots of litigation against this bill from these two groups.

[excession]

It says that no person engaged in the business of betting (bookmaker) may accept:
1. Credit including cc’s
2. An eft.
3. Check, draft, or similar instrument
4. Any proceeds (a catch all)


So if you were just an online poker play in Europe - you could accept infra-site transfers of funds from your US friends and then transfer them the proceeds by EFT without breaking any laws? Or is playing poker online if you are a US citizen definitively criminalised now so that this would be money-laundering?

So even if Neteller etc stops taking US custumers getting them money out of sites if you are a successful US player seems OK unless all the sites stop accepting US players..it's the question of the US fish being unable to fund that is the issue..

[mpslg]

I have only read through this bill once, so if I'm wrong about this, I'm sure somebody can point me in the right direction.

The bill defines a "bet or wager" which I think clearly includes playing poker.

The bill states the term "unlawful internet gambling" means to place, receive, or otherwise knowingly transmit a bet or wager by any means which involves the use, at least in part, of the internet where such bet or wager is unlawful under any applicable Federal or State law in the State or Tribal lands in which the bet or wager is initiated, received, or otherwise made.

I know there are certain states where playing poker online is clearly illegal. However, I think everyone is pretty much in agreement that the federal law did not prohibit online poker. The wire act clearly prohibits placing sports bets.

Is there part of this bill that changes the wire act to include online poker? If not, isn't there an argument that online poker is still legal under federal law?

Section 5363 of the bill states "no person engaged in the business of betting or wagering may knowingly accept, in connection with the participation of another person in unlawful internet gambling (credit cards, EFTs etc.)

If poker is not considered "unlawful internet gambling" per the definition in the bill, then won't the poker sites be allowed to continue accepting EFTs?

Am I way off base in this analysis? My mind is still a little foggy from all of the beer I consumed last night.

[BluffTHIS!]

A poker site is considered to be accepting an unlawful wager. This has been brought up in other threads, and what you are missing is that the federal law just gives the anti-gamlbing laws of the various states teeth in being enforced by the federal government as to offshore gambling by that state's citizens. Plus they construe the wire act as already doing that on a federal level, even though many legal opinions differ.

[MannyIsGod]

[ QUOTE ]
I have only read through this bill once, so if I'm wrong about this, I'm sure somebody can point me in the right direction.

The bill defines a "bet or wager" which I think clearly includes playing poker.

The bill states the term "unlawful internet gambling" means to place, receive, or otherwise knowingly transmit a bet or wager by any means which involves the use, at least in part, of the internet where such bet or wager is unlawful under any applicable Federal or State law in the State or Tribal lands in which the bet or wager is initiated, received, or otherwise made.

I know there are certain states where playing poker online is clearly illegal. However, I think everyone is pretty much in agreement that the federal law did not prohibit online poker. The wire act clearly prohibits placing sports bets.

Is there part of this bill that changes the wire act to include online poker? If not, isn't there an argument that online poker is still legal under federal law?

Section 5363 of the bill states "no person engaged in the business of betting or wagering may knowingly accept, in connection with the participation of another person in unlawful internet gambling (credit cards, EFTs etc.)

If poker is not considered "unlawful internet gambling" per the definition in the bill, then won't the poker sites be allowed to continue accepting EFTs?

Am I way off base in this analysis? My mind is still a little foggy from all of the beer I consumed last night.

[/ QUOTE ]

I would imagine that may be one of the semantic arguments lawfirms for these companies or hired by the PPA may present. I can't say how much merit they may or may not have, but that may not be a question that is answered until much further down the line and after actual litigation.

[Analyst]

[ QUOTE ]
For the poker professional receiving endorsement dollars ...

[/ QUOTE ]

So would this bill affect someone like a Chris Ferguson or Greg Raymer? I assume that they (or at least most of the site-affiliated pros) are not employees of Full Tilt, PokerStars, etc. but are rather contractors with the company. Would they be considered as being a "person engaged in the business of betting" and potentially subject to the criminal penalties specified in the bill?

[Albert Moulton]

[ QUOTE ]
Nothing in this bill criminalizes your behavior as the bettor.


[/ QUOTE ]

This may be the way the bill reads, but it's not how one Democratic Senator described the Port Security Bill last night on CSPAN. He complained that Republicans didn't let the Democrats add any of their security-related ammendments to the bill, but that they insisted in adding language that made it illegal to play "Texas Hold'em poker from your home." He was pretty mad. So, at least, he thinks the bill makes playing poker illegal even if our reading of the text interpets it differently.

I think this will have to end up in courts to figure it out.

[Copernicus]

[ QUOTE ]
[ QUOTE ]
For the poker professional receiving endorsement dollars ...

[/ QUOTE ]

So would this bill affect someone like a Chris Ferguson or Greg Raymer? I assume that they (or at least most of the site-affiliated pros) are not employees of Full Tilt, PokerStars, etc. but are rather contractors with the company. Would they be considered as being a "person engaged in the business of betting" and potentially subject to the criminal penalties specified in the bill?

[/ QUOTE ]

As long as their compensation is fixed and not dependent on revenues I doubt they would be affected. An advertising spokesperson is not liable for the actions of the company they advertise for.