worldonline gamblinglawreport FEATURED ARTICLE 10 /06 cecile park - PDF document

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UNITED STATES The Unlawful Internet Gambling Enforcement Act 2006 The differing market reaction to the card, stored value and check pertaining to the establishment or transactions - involving illegal movement of funds by the bettor passage of the Unlawful Internet internet gambling businesses. or customer in, to, or from an Gambling Enforcement Act Third, it permits civil actions to account with the business of illustrated some confusion over be brought in US federal District betting or wagering.’ This language which online gambling activities in Courts to enjoin activities was not in the Goodlatte-Leach associated with unlawful internet Bill. Commentators speculate that which jurisdictions are covered, as gambling, subject to restrictions. this inclusion was to counter a well as who is responsible for contention that after funds are policing that activity. Linda J. The prohibition deposited with an offshore Shorey, Sean P . Mahoney, Ashley J. The Act prohibits those ‘engaged in gambling business, bets may be Camron and Anthony R. Holtzman, the business of betting or made legally offshore. wagering’ from accepting money or Among the excluded activities are of the Betting and Gaming Practice money substitutes ‘in connection certain financial transactions that Group at Kirkpatrick & Lockhart with the participation of another would otherwise, at least Nicholson Graham LLP , examine person in unlawful Internet technically, fall within the and explain the Act’s provisions. gambling.’ In connection with the definition of bet or wager, as is prohibition, three definitions are participation in fantasy sports Background key - ‘business of betting or games, if certain conditions are On October 13, 2006, the US wagering,’‘bet or wager,’ and met. President signed into law the ‘unlawful Internet gambling.’ “SAFE Port Act.”Appended to the Unlawful internet gambling SAFE Port Act is the “Unlawful Business of betting or wagering The Act defines ‘unlawful internet Internet Gambling Enforcement The Act defines ‘Business of gambling’ as ‘to place, receive, or Act of 2006” (the “Act”). The Act is Betting or Wagering’ in the otherwise knowingly transmit a bet a truncated version of the negative, stating only that it ‘does or wager by any means which Goodlatte-Leach Bill, passed by the not include the activities of a involves the use, at least in part, of US House of Representatives in the financial transaction provider, or the internet where such bet or Summer of 2006. Unlike the any interactive computer service or wager is unlawful’ where made. Goodlatte-Leach Bill, the Act does telecommunications service.’ Thus, like other federal criminal not amend or clarify the scope of statutes, such as RICO, violation of the Wire Act, 18 U.S.C. §1084. Bet or wager the Act depends on there being a There are other, more subtle The Act defines ‘Bet or Wager’ as violation of a state gambling law or differences, some of which are ‘the staking or risking by any another federal law. mentioned below. person of something of value upon The federal law most likely to the outcome of a contest of others, trigger the Act is the Wire Act. Overview of the act a sporting event, or a game subject More likely triggers, however, will The Act does three primary things. to chance, upon an agreement or be violations of state gambling First, it prohibits persons engaged understanding that the person or laws. in the business of betting or another person will receive There are three activities that wagering from accepting certain something of value in the event of would likely fall within the forms of payments received via US a certain outcome.’ This is one of definition of unlawful internet payment systems and made in the more subtle changes from the gambling but which are excepted connection with unlawful internet Goodlatte-Leach Bill. from the definition. The term ‘does gambling. Those convicted of Commentators speculate that the not include placing, receiving or violating the Act are subject to deletion of the word otherwise transmitting a bet or fines, imprisonment for five years ‘predominantly’ from between wager where’; and being permanently enjoined ‘game’ and ‘chance’ was for the G The activity takes place entirely from involvement in activities purpose of encompassing any within a single state, so long as associated with betting and game with an element of chance, such transactions are explicitly wagering. including poker games. authorized by state law and Second, it requires regulations to Among those activities explicitly provided that the state law includes be promulgated related to blocking included in the definition are ‘any requirements relating to data transactions - including credit instructions or information security and restricting access to 06 world online gambling october 2006