S 3616 ISCommentsClose CommentsPermalink

To amend title 31, United States Code, to provide for the licensing of Internet skill game facilities, and for other purposes.CommentsClose CommentsPermalink

September 26 (legislative day, September 17), 2008CommentsClose CommentsPermalink

Mr. MENENDEZ introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban AffairsCommentsClose CommentsPermalink

To amend title 31, United States Code, to provide for the licensing of Internet skill game facilities, and for other purposes.CommentsClose CommentsPermalink

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,CommentsClose CommentsPermalink

SECTION 1. SHORT TITLE.

This Act may be cited as the ‘Internet Skill Game Licensing and Control Act of 2008’.CommentsClose CommentsPermalink

SEC. 2. FEDERAL LICENSING REQUIREMENT FOR INTERNET GAMBLING OPERATIONS.

(a) In General- Chapter 53 of title 31, United States Code, is amended by adding at the end the following:CommentsClose CommentsPermalink

‘SUBCHAPTER V--REGULATION OF INTERNET SKILL GAME FACILITIES

‘Sec. 5381. Definitions

‘In this subchapter:CommentsClose CommentsPermalink





‘(1) BET OR WAGER- The term ‘bet or wager’ has the meaning given the term in section 5362.CommentsClose CommentsPermalink





‘(2) INDIAN LANDS AND INDIAN TRIBE- The terms ‘Indian lands’ and ‘Indian tribe’ have the meaning given such terms in section 4 of the Indian Gaming Regulatory Act (25 U.S.C. 2703).CommentsClose CommentsPermalink





‘(3) INTERNET- The term ‘Internet’ has the meaning given the term in section 5362.CommentsClose CommentsPermalink





‘(4) INTERNET SKILL GAME- The term ‘Internet skill game’ means an Internet-based game that uses simulated cards, dice, or tiles in which success is predominantly determined by the skill of the players, including poker, bridge, and mahjong.CommentsClose CommentsPermalink





‘(5) INTERNET SKILL GAME FACILITY- The term ‘Internet skill game facility’ means an Internet site through which a permitted bet or wager is placed, accepted, or otherwise made, whether transmitted by telephone, Internet, or other electronic communication.CommentsClose CommentsPermalink





‘(6) LICENSEE- The term ‘licensee’ means a person that operates an Internet skill game facility under a license issued by the Secretary under this subchapter.CommentsClose CommentsPermalink





‘(7) NON-HOUSE-BANKED GAME- The term ‘non-house-banked game’ means a game--CommentsClose CommentsPermalink





‘(A) that--CommentsClose CommentsPermalink





‘(i) consists of players playing against each other and not against the operator of the game; andCommentsClose CommentsPermalink





‘(ii) provides for payouts, if any, that are drawn from the players’ pool and not from the operator of the game; andCommentsClose CommentsPermalink





‘(B) may be operated by an Internet skill game facility in which the operator retains a percentage of the players’ pool or receives a fixed fee as compensation.CommentsClose CommentsPermalink





‘(8) OPERATES AN INTERNET SKILL GAME FACILITY- The term ‘operates an Internet skill game facility’ means directs, manages, supervises, or controls an Internet skill game facility.CommentsClose CommentsPermalink





‘(9) PERMITTED BET OR WAGER- The term ‘permitted bet or wager’ means a bet or wager made with respect to the outcome of an Internet skill game that is a non-house-banked game.CommentsClose CommentsPermalink





‘(10) SECRETARY- The term ‘Secretary’ means the Secretary of the Treasury.CommentsClose CommentsPermalink





‘(11) STATE- The term ‘State’ means any State of the United States, the District of Columbia, or any commonwealth, territory, or other possession of the United States.CommentsClose CommentsPermalink

‘Sec. 5382. Establishment and administration of licensing program

‘(a) License Required- Beginning 6 months after the issuance of the first license under this subchapter, it shall be unlawful for a person to operate an Internet skill game facility in interstate or foreign commerce without a license issued to such person by the Secretary under this subchapter.CommentsClose CommentsPermalink





‘(b) Applications for License-CommentsClose CommentsPermalink





‘(1) APPLICATION- A person seeking a license to operate an Internet skill game facility in interstate or foreign commerce shall submit to the Secretary an application therefore in such form and in such manner as the Secretary considers appropriate.CommentsClose CommentsPermalink





‘(2) ELEMENTS- Each application submitted under paragraph (1) shall include such information as the Secretary considers appropriate, including the following:CommentsClose CommentsPermalink





‘(A) Complete financial information about the applicant.CommentsClose CommentsPermalink





‘(B) Documentation showing the corporate structure of the applicant and all related businesses and affiliates.CommentsClose CommentsPermalink





‘(C) The names of all persons directly or indirectly interested in the business of the applicant and the nature of such interest.CommentsClose CommentsPermalink





‘(D) A certification by the applicant, agreeing to be subject to United States jurisdiction and all applicable United States laws relating to Internet skill games or gambling activities.CommentsClose CommentsPermalink





‘(3) WAIVER OF PRIVILEGE- Any applicant may claim any privilege afforded by the Constitution of the United States in refusing to answer questions by the Secretary. A claim of privilege with respect to any testimony or evidence pertaining to an application may constitute sufficient grounds for denial of a license under this subchapter.CommentsClose CommentsPermalink





‘(c) Review of Applicants and Licensees-CommentsClose CommentsPermalink





‘(1) IN GENERAL- The Secretary may not issue a license to an applicant under this subchapter unless the Secretary has determined, after evaluating the factors described in paragraph (2), that the applicant is qualified for such license.CommentsClose CommentsPermalink





‘(2) FACTORS- The factors to be evaluated by the Secretary under paragraph (1) shall include the following:CommentsClose CommentsPermalink





‘(A) The honesty and integrity of the applicant.CommentsClose CommentsPermalink





‘(B) The business probity and relevant experience of the applicant.CommentsClose CommentsPermalink





‘(C) The financial condition of the applicant.CommentsClose CommentsPermalink





‘(D) Whether the applicant has adequate financial capabilities from suitable sources.CommentsClose CommentsPermalink





‘(E) The applicant’s record of compliance with laws and requirements related to Internet skill gaming in foreign jurisdictions.CommentsClose CommentsPermalink





‘(3) BACKGROUND CHECKS- In evaluating an applicant under paragraph (1), the Secretary shall--CommentsClose CommentsPermalink





‘(A) if the applicant is an individual, carry out a background check to determine if the individual has a criminal record; andCommentsClose CommentsPermalink





‘(B) if the applicant is a corporation, partnership, or other business entity, carry out a background check to determine if the president or other chief executive of the applicant and other partners or senior executives and directors of the applicant, as determined appropriate by the Secretary, have a criminal record.CommentsClose CommentsPermalink





‘(4) MONITORING- The Secretary shall monitor continuously each licensee and all other persons having a material involvement directly or indirectly with the operation of the Internet skill gaming facility of such licensee to ensure that--CommentsClose CommentsPermalink





‘(A) a license issued under this subchapter is held only by a person whom the Secretary considers qualified to operate an Internet skill game facility; andCommentsClose CommentsPermalink





‘(B) the operation of an Internet skill game facility by a licensee has no material involvement of any person whom the Secretary considers unqualified or unsuitable for such operation.CommentsClose CommentsPermalink





‘(d) Approval of License-CommentsClose CommentsPermalink





‘(1) IN GENERAL- The Secretary shall issue a license under this subchapter to an applicant if the Secretary determines, after considering the factors described in subsection (c)(2), that the applicant is qualified to operate an Internet skill gaming facility.CommentsClose CommentsPermalink





‘(2) BURDEN OF PROOF- An applicant for a license under this subchapter has the burden of proving that the applicant is qualified and suitable for such license.CommentsClose CommentsPermalink





‘(e) Denial, Restriction, or Revocation of Licenses-CommentsClose CommentsPermalink





‘(1) DENIAL- The Secretary may not issue a license under this subchapter to an applicant who has been convicted under the laws of any foreign country, the United States, or any State for any criminal violation involving gambling laws, laws relating to financial markets, or financial laws, including any provisions of law relating to money laundering, fraud, privacy, or information security.CommentsClose CommentsPermalink





‘(2) CONDITIONS, LIMITATIONS, AND RESTRICTIONS- The Secretary may provide any condition, limitation, or restriction on a license issued under this subchapter that the Secretary considers reasonable to ensure the integrity and fairness of Internet skill game facilities.CommentsClose CommentsPermalink





‘(3) REVOCATION- The Secretary shall terminate or revoke a license issued to a licensee under this subchapter if the licensee--CommentsClose CommentsPermalink





‘(A) fails to comply with any provision of this subchapter; orCommentsClose CommentsPermalink





‘(B) is convicted of a crime involving the payments system, financial markets, or Internet gambling laws of the United States or of the jurisdiction in which the licensee is located.CommentsClose CommentsPermalink





‘(4) APPLICABILITY TO BUSINESS ENTITIES- If a licensee or applicant for a license under this subchapter is a corporation, partnership, or other business entity, paragraphs (1) and (3) shall apply with respect to each partner, officer, or director of such corporation, partnership, or entity.CommentsClose CommentsPermalink





‘(5) FINAL ACTION- An action by the Secretary under this subsection shall be treated as a final action by the Secretary.CommentsClose CommentsPermalink





‘(f) Term and Renewal of License-CommentsClose CommentsPermalink





‘(1) TERM- Each license issued by the Secretary under this subchapter shall be issued for a 1-year term beginning on the date of issuance.CommentsClose CommentsPermalink





‘(2) RENEWAL- The Secretary may renew a license issued under this subchapter in accordance with such requirements as the Secretary shall prescribe to ensure the continued compliance of licensees with the provisions of this subchapter.CommentsClose CommentsPermalink





‘(g) Safeguards and Requirements-CommentsClose CommentsPermalink





‘(1) SAFEGUARDS- No person shall receive or retain a license under this subchapter unless the person implements and maintains the following safeguards and mechanisms with respect to any permitted bet or wager:CommentsClose CommentsPermalink





‘(A) Reasonable safeguards to ensure that each individual placing a permitted bet or wager is 18 years of age or older.CommentsClose CommentsPermalink





‘(B) Reasonable safeguards to ensure that each individual placing a permitted bet or wager is physically located in a jurisdiction that permits the operation of an Internet skill game facility at the time the permitted bet or wager is placed.CommentsClose CommentsPermalink





‘(C) Reasonable mechanisms to ensure that all taxes relating to Internet skill games payable to Federal and State governments and to Indian tribes from persons engaged in Internet skill games are collected at the time of any payment of any proceeds of Internet skill games.CommentsClose CommentsPermalink





‘(D) Reasonable mechanisms to ensure that all taxes relating to Internet skill games payable to Federal and State governments and to Indian tribes are collected as required by law.CommentsClose CommentsPermalink





‘(E) Reasonable safeguards to prevent fraud and money laundering as may be prescribed by regulations promulgated by the Secretary.CommentsClose CommentsPermalink





‘(F) Reasonable safeguards to prevent or mitigate social problems that some individuals may experience related to playing Internet skill games.CommentsClose CommentsPermalink





‘(G) Reasonable safeguards to protect the privacy and security of any individual participating in an Internet skill game.CommentsClose CommentsPermalink





‘(H) Reasonable mechanisms to ensure that any assessment required under subsection (h) is paid to the Secretary.CommentsClose CommentsPermalink





‘(I) Such other safeguards and mechanisms as the Secretary may establish by regulation or order.CommentsClose CommentsPermalink





‘(2) REQUIREMENTS- No person may receive or retain a license under this subchapter unless the person complies with anti-money laundering, anti-fraud, anti-terrorism, and such other regulations, requirements, and limitations as may be prescribed by the Secretary.CommentsClose CommentsPermalink





‘(h) Assessments for Administrative Expenses-CommentsClose CommentsPermalink





‘(1) IN GENERAL-CommentsClose CommentsPermalink





‘(A) COSTS- The cost of administering this subchapter with respect to each licensee, including the cost of any review or examination of a licensee to ensure compliance with the terms of the license and this subchapter, shall be assessed by the Secretary against the respective licensee by written notice in an amount appropriate to meet the expenses of the Secretary in carrying out such administration, review, or examination.CommentsClose CommentsPermalink





‘(B) DISPOSITION- Amounts assessed by the Secretary as user fees under subparagraph (A)--CommentsClose CommentsPermalink





‘(i) shall be maintained by the Secretary solely for use in accordance with clause (ii);CommentsClose CommentsPermalink





‘(ii) shall be available to the Secretary to cover all expenses incurred by the Secretary in carrying out this subchapter; andCommentsClose CommentsPermalink





‘(iii) may not be construed to be Government funds or appropriated monies, or subject to apportionment for the purposes of chapter 15 or any other authority.CommentsClose CommentsPermalink





‘(C) HEARING- Any licensee notified of an assessment under this paragraph shall be granted a hearing by the Secretary if the licensee submits a request for such hearing not later than 20 days after the date on which the notice of such assessment is issued.CommentsClose CommentsPermalink





‘(D) COLLECTION-CommentsClose CommentsPermalink





‘(i) REFERRAL- If the licensee fails to pay an assessment under this paragraph after the assessment has become final, the Secretary shall recover the amount assessed by action in an appropriate United States district court.CommentsClose CommentsPermalink





‘(ii) APPROPRIATENESS OF ASSESSMENT NOT REVIEWABLE- In any civil action under clause (i), the validity and appropriateness of the assessment shall not be subject to review.CommentsClose CommentsPermalink





‘(2) DIRECT AND EXCLUSIVE OBLIGATION OF LICENSEE- An assessment on a licensee under paragraph (1)--CommentsClose CommentsPermalink





‘(A) shall be the direct and exclusive obligation of the licensee; andCommentsClose CommentsPermalink





‘(B) may not be deducted from amounts available as deposits to any person placing a permitted bet or wager.CommentsClose CommentsPermalink





‘(i) Regulations-CommentsClose CommentsPermalink





‘(1) IN GENERAL- Not later than 180 days after the date of the enactment of this subchapter, the Secretary shall prescribe such regulations, safeguards, and testing mechanisms as may be necessary to administer and enforce the provisions of this subchapter.CommentsClose CommentsPermalink





‘(2) CHANGES- The Secretary may revise or repeal the regulations prescribed under this subsection as the Secretary determines necessary to ensure the integrity and fairness of Internet skill game facilities.CommentsClose CommentsPermalink





‘(j) Administrative Provisions-CommentsClose CommentsPermalink





‘(1) GENERAL POWERS OF SECRETARY- The Secretary may--CommentsClose CommentsPermalink





‘(A) require a class of licensees to maintain appropriate procedures to ensure compliance with this subchapter and regulations prescribed under this subchapter;CommentsClose CommentsPermalink





‘(B) examine any licensee and any books, papers, records, or other data of licensees relevant to any recordkeeping or reporting requirements imposed by the Secretary under this subchapter; andCommentsClose CommentsPermalink





‘(C) summon a licensee or an applicant for a license, an officer or employee of a licensee or any such applicant (including a former officer or employee), or any person having possession, custody, or care of the reports and records required by the Secretary under this subchapter to appear before the Secretary or a designee of the Secretary at a time and place named in the summons and to produce such books, papers, records, or other data, and to give testimony, under oath, as may be relevant or material to any investigation in connection with the enforcement of this subchapter or any application for a license under this subchapter.CommentsClose CommentsPermalink





‘(2) ADMINISTRATIVE ASPECTS OF SUMMONS-CommentsClose CommentsPermalink





‘(A) PRODUCTION AT DESIGNATED SITE- A summons issued pursuant to this subsection may require that books, papers, records, or other data stored or maintained at any place be produced at any business location of a licensee or applicant for a license or any designated location in any State or in any territory or other place subject to the jurisdiction of the United States not more than 500 miles distant from any place where the licensee or applicant for a license operates or conducts business in the United States.CommentsClose CommentsPermalink





‘(B) NO LIABILITY FOR EXPENSES- The United States shall not be liable for any expense incurred in connection with the production of books, papers, records, or other data under this subsection.CommentsClose CommentsPermalink





‘(C) SERVICE OF SUMMONS- Service of a summons issued under this subsection may be by registered mail or in such other manner calculated to give actual notice as the Secretary may prescribe by regulation.CommentsClose CommentsPermalink





‘(3) CONTUMACY OR REFUSAL-CommentsClose CommentsPermalink





‘(A) REFERRAL TO ATTORNEY GENERAL- In case of contumacy by a person issued a summons under this subsection or a refusal by such person to obey such summons or to allow the Secretary to conduct an examination, the Secretary shall refer the matter to the Attorney General.CommentsClose CommentsPermalink





‘(B) JURISDICTION OF COURT- The Attorney General may invoke the aid of any court of the United States within the jurisdiction of which--CommentsClose CommentsPermalink





‘(i) the investigation which gave rise to the summons or the examination is being or has been carried on;CommentsClose CommentsPermalink





‘(ii) the person summoned is an inhabitant; orCommentsClose CommentsPermalink





‘(iii) the person summoned carries on business or may be found,CommentsClose CommentsPermalink





to compel compliance with the summons.CommentsClose CommentsPermalink





‘(C) COURT ORDER- The court may issue an order requiring the person summoned to appear before the Secretary or a delegate of the Secretary to produce books, papers, records, and other data, to give testimony as may be necessary to explain how such material was compiled and maintained, to allow the Secretary to examine the business of a licensee, and to pay the costs of the proceeding.CommentsClose CommentsPermalink





‘(D) FAILURE TO COMPLY WITH ORDER- Any failure to obey the order of the court may be punished by the court as a contempt thereof.CommentsClose CommentsPermalink





‘(E) SERVICE OF PROCESS- All process in any case under this subsection may be served in any judicial district in which such person may be found.CommentsClose CommentsPermalink

‘Sec. 5383. Financial institutions

‘(a) Investment Banking- A person may not be held liable for engaging in investment banking activities involving a licensee if such activities are performed in compliance with--CommentsClose CommentsPermalink





‘(1) the provisions of this subchapter;CommentsClose CommentsPermalink





‘(2) the provisions of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7201 et seq.);CommentsClose CommentsPermalink





‘(3) the provisions of the Securities Act of 1933 (15 U.S.C. 77a et seq.);CommentsClose CommentsPermalink





‘(4) the provisions of the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.); andCommentsClose CommentsPermalink





‘(5) any other applicable provision of law that governs securities.CommentsClose CommentsPermalink





‘(b) Payment and Transaction Processing- A person may not be held liable for engaging in payments processing activities involving a licensee if such activities are performed in compliance with the provisions of this subchapter.CommentsClose CommentsPermalink





‘(c) Financial Institutions- A financial institution may not be held liable for engaging in financial activities and transactions involving a licensee if such activities are performed in compliance with--CommentsClose CommentsPermalink





‘(1) the provisions of this subchapter; andCommentsClose CommentsPermalink





‘(2) applicable provisions of Federal, State, and foreign banking laws.CommentsClose CommentsPermalink

‘Sec. 5384. Prohibition and limitation of licenses in States and on Indian lands

‘(a) State and Indian Tribe Opt Out-CommentsClose CommentsPermalink





‘(1) IN GENERAL- A licensee may not accept a permitted bet or wager from an individual physically located in any State or on tribal lands of any Indian tribe that prohibits permitted bets or wagers within such State or tribal lands if the Governor, or other chief executive officer of such State, or head of the tribal government of such Indian tribe informs the Secretary of such prohibition before the end of the 90-day period beginning on the date of the enactment of the Internet Skill Game Licensing and Control Act of 2008, or in accordance with paragraph (3), until such time as any notice of any subsequent repeal of such prohibition becomes effective under paragraph (3).CommentsClose CommentsPermalink





‘(2) LIMITATIONS IMPOSED BY STATES OR INDIAN TRIBES- A licensee may not accept a permitted bet or wager with respect to a particular type of Internet skill game in any State or tribal lands of any Indian tribe that prohibits such permitted bet or wager with respect to such particular type of Internet skill game if the Governor, or other chief executive officer of such State, or head of the tribal government of such Indian tribe informs the Secretary of such prohibition, in a manner that clearly identifies the nature and extent of such prohibition, before the end of the 90-day period beginning on the date of the enactment of the Internet Skill Game Licensing and Control Act of 2008, or in accordance with paragraph (3), until such time as any notice of any amendment or repeal of such specific prohibition becomes effective under paragraph (3).CommentsClose CommentsPermalink





‘(3) CHANGES TO STATE OR INDIAN TRIBE LIMITATIONS- The establishment, repeal, or amendment by any State or Indian tribe of any prohibition or limitation referred to in paragraph (1) or (2) after the end of the 90-day period beginning on the date of the enactment of the Internet Skill Game Licensing and Control Act of 2008 shall apply, for purposes of this subchapter, with respect to operating an Internet skill game facility in such State or on the tribal lands of such Indian tribe by any licensee beginning on the first January 1 that occurs after the end of the 30-day period beginning on the later of--CommentsClose CommentsPermalink





‘(A) the date on which written notice of such establishment, repeal, or amendment is provided to the Secretary by the Governor, or other chief executive officer of such State, or the head of the tribal government of such Indian tribe; orCommentsClose CommentsPermalink





‘(B) the effective date of such establishment, repeal, or amendment.CommentsClose CommentsPermalink





‘(b) Regulation of Internet Skill Gaming by States and Indian Tribes-CommentsClose CommentsPermalink





‘(1) IN GENERAL- A State or Indian tribe may establish a requirement relating to the regulation of an Internet skill game facility if such requirement--CommentsClose CommentsPermalink





‘(A) applies only to the people in such State or on the tribal lands of such Indian tribe; andCommentsClose CommentsPermalink





‘(B) such requirement provides protection for players of Internet skill games that exceeds the protection provided such players under this subchapter.CommentsClose CommentsPermalink





‘(2) ADDITIONAL LIMITATIONS IMPOSED BY STATES OR INDIAN TRIBES- No licensee may accept a permitted bet or wager from an individual physically located in any State or tribal lands of any Indian tribe unless the licensee adheres to those the requirements established by such State or Indian tribe under paragraph (1).CommentsClose CommentsPermalink





‘(3) CHANGES TO STATE OR INDIAN TRIBE LIMITATIONS- The establishment, repeal, or amendment of any requirement referred to in paragraph (1) by any State or any Indian tribe after the end of the 90-day period beginning on the date of the enactment of the Internet Skill Game Licensing and Control Act of 2008 shall apply, for purposes of this subchapter, with respect to offering an Internet skill game facility in such State or Indian tribe by any licensee beginning on the first January 1 that occurs after the end of the 30-day period beginning on the later of--CommentsClose CommentsPermalink





‘(A) the date a notice of such establishment, repeal, or amendment is provided by the Governor, or other chief executive officer of such State, or head of the tribal government of such Indian tribe in writing to the Secretary; orCommentsClose CommentsPermalink





‘(B) the effective date of such establishment, repeal, or amendment.CommentsClose CommentsPermalink





‘(c) Enforcing State and Indian Tribe Limitations-CommentsClose CommentsPermalink





‘(1) IN GENERAL- The Secretary shall take effective measures to ensure that each licensee complies, as a condition of the license, with any limitation or prohibition imposed by any State or Indian tribe to which the licensee is subject under subsections (a) and (b).CommentsClose CommentsPermalink





‘(2) VIOLATIONS- It shall be a violation of this subchapter for a licensee to accept knowingly a permitted bet or wager from an individual physically located in a State or in the tribal lands of an Indian tribe for which a notice is in effect under subsection (a) or (b) without complying with all of the prohibitions, limitations, and requirements imposed by such State or Indian tribe under such subsections.CommentsClose CommentsPermalink





‘(d) Intermediate Routing- The intermediate routing of electronic data shall not determine the location or locations in which a permitted bet or wager is initiated, received, or otherwise made.CommentsClose CommentsPermalink

‘Sec. 5385. Sporting events or contests

‘(a) Construction- No provision of this subchapter may be construed to permit a bet or wager in connection with a sporting event or contest of a sporting league.CommentsClose CommentsPermalink





‘(b) Prohibition on Facilitation by Licensees of Bets or Wagers Relating to Sporting Events-CommentsClose CommentsPermalink





‘(1) PROHIBITION- A licensee may not, as a condition of its license, facilitate a bet or wager in connection with a sporting event or contest of a sporting league.CommentsClose CommentsPermalink





‘(2) ENFORCEMENT- The Secretary shall take effective measures to enforce the provisions of paragraph (1).CommentsClose CommentsPermalink

‘Sec. 5386. Safe harbor

‘It shall be a defense against any prosecution or enforcement action under any Federal or State law against a licensee that the activity for which the defendant is being prosecuted is authorized under, and has been carried out in accordance with, the provisions of this subchapter.CommentsClose CommentsPermalink

‘Sec. 5387. Criminal penalties

‘(a) In General- Any person who knowingly violates any provision of this subchapter shall be fined under title 18, imprisoned for not more than 5 years, or both.CommentsClose CommentsPermalink





‘(b) Permanent Injunction- Upon conviction of a person under this section, the court may permanently enjoin such person from operating an Internet skill game facility.CommentsClose CommentsPermalink

‘Sec. 5388. Rules of construction

‘(a) No Effect on Prior Law- No provision of this subchapter may be construed as altering or limiting any Federal or State law or Tribal-State compact that permitted or regulated Internet skill gaming in the United States before the date of the enactment of the Internet Skill Game Licensing and Control Act of 2008.CommentsClose CommentsPermalink





‘(b) Coordination With Certain Gambling Laws- No provision of this subchapter may be construed as permitting any bet or wager that would otherwise violate any provision of--CommentsClose CommentsPermalink





‘(1) the Interstate Horse Racing Act of 1978 (15 U.S.C. 3001 et seq.);CommentsClose CommentsPermalink





‘(2) chapter 178 of title 28;CommentsClose CommentsPermalink





‘(3) the Gambling Devices Transportation Act (15 U.S.C. 1171 et seq.); orCommentsClose CommentsPermalink





‘(4) the Indian Gaming Regulatory Act (25 U.S.C. 2701 et seq.).CommentsClose CommentsPermalink

‘Sec. 5389. Periodic reports by licensees

‘(a) In General- Each licensee shall submit to the Secretary, at intervals prescribed by the Secretary, a report on the operations of the licensee for the most recent period for which such report is submitted.CommentsClose CommentsPermalink





‘(b) Contents- Each report submitted by a licensee under subsection (a) shall include, for the most recent period for which the report is submitted to the Secretary, the following:CommentsClose CommentsPermalink





‘(1) A comprehensive statement describing the limitations imposed on the licensee by any State, Indian tribe, or sporting league.CommentsClose CommentsPermalink





‘(2) Such other information as the Secretary considers appropriate.CommentsClose CommentsPermalink





‘(c) Standardization of Reporting- The Secretary shall prescribe, with respect to reports required under subsection (a)--CommentsClose CommentsPermalink





‘(1) standard forms for reporting financial condition, results of operations, and other relevant financial information about licensees;CommentsClose CommentsPermalink





‘(2) a uniform code of accounts and accounting classifications to assure consistency, comparability, and effective disclosure of financial information; andCommentsClose CommentsPermalink





‘(3) the intervals at which licensees shall submit such reports.CommentsClose CommentsPermalink

‘Sec. 5390. Annual reports by Secretary

‘(a) In General- Not later than 18 months after the date of the issuance of the first license under this subchapter and annually thereafter, the Secretary shall submit to Congress a report on the licensing and regulation of operators of Internet skill game facilities.CommentsClose CommentsPermalink





‘(b) Contents- Each report required by subsection (a) shall include, for the 1-year period ending on the date on which such report is submitted to Congress, the following:CommentsClose CommentsPermalink





‘(1) Relevant statistical information on applications for licenses under this subchapter and licenses issued under this subchapter.CommentsClose CommentsPermalink





‘(2) The amounts collected from licensees under section 5382(h).CommentsClose CommentsPermalink





‘(3) Information on regulatory or enforcement actions undertaken by the Secretary.CommentsClose CommentsPermalink





‘(4) Such other information as may be useful to Congress in evaluating the effectiveness of the provisions of this subchapter, including the effectiveness of such provisions in--CommentsClose CommentsPermalink





‘(A) protecting against underage gambling, social problems that some players may experience related to Internet skill game play, money laundering, and fraud; andCommentsClose CommentsPermalink





‘(B) preventing tax avoidance related to online activities.’.CommentsClose CommentsPermalink





(b) Conforming Amendment- Section 1084(a) of title 18, United States Code, is amended--CommentsClose CommentsPermalink





(1) by striking ‘Whoever’ and inserting ‘(1) Except as provided in paragraph (2), any person who’; andCommentsClose CommentsPermalink





(2) by adding at the end the following:CommentsClose CommentsPermalink





‘(2)(A) The provisions of paragraph (1) shall not apply to a permitted bet or wager with respect to a licensee who operates an Internet skill game facility.CommentsClose CommentsPermalink





‘(B) In this paragraph, the terms ‘licensee’, ‘operates an Internet skill game facility’, and ‘permitted bet or wager’ have the meaning given such terms in section 5381 of title 31.’.CommentsClose CommentsPermalink





(c) Clerical Amendment- The table of sections for chapter 53 of title 31, United States Code, is amended by adding at the end the following:CommentsClose CommentsPermalink

‘subchapter v--regulation of internet skill game facilities

‘Sec. 5381. Definitions.CommentsClose CommentsPermalink





‘Sec. 5382. Establishment and administration of licensing program.CommentsClose CommentsPermalink





‘Sec. 5383. Financial institutions.CommentsClose CommentsPermalink





‘Sec. 5384. Prohibition and limitation of licenses in States and on Indian lands.CommentsClose CommentsPermalink





‘Sec. 5385. Sporting events or contests.CommentsClose CommentsPermalink





‘Sec. 5386. Safe harbor.CommentsClose CommentsPermalink





‘Sec. 5387. Criminal penalties.CommentsClose CommentsPermalink





‘Sec. 5388. Rules of construction.CommentsClose CommentsPermalink





‘Sec. 5389. Periodic reports by licensees.CommentsClose CommentsPermalink





‘Sec. 5390. Annual reports by Secretary.’.CommentsClose CommentsPermalink