Sec. 101. Findings

907 words·~4 min read·/bill/113/hr/2282/ih/section-101

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

Congress makes the following findings: Since the development of the Internet, Internet sites offering Internet gambling have raised consumer protection and enforcement concerns for Federal and State governments as such Internet sites are often run by unknown operators located in many different countries, subject to little or no oversight, and have sought to attract customers from the United States. Subchapter IV of chapter 53 of title 31, United States Code, which was added by the enactment of the Unlawful Internet Gambling Enforcement Act of 2006 (title VIII of Public Law 109–347 ; 120 Stat. 1952), makes it a Federal crime for gambling businesses to knowingly accept most forms of payment in connection with the participation of another person in unlawful Internet gambling.

Since the enactment of the Unlawful Internet Gambling Enforcement Act of 2006, such subchapter IV has helped aid enforcement efforts against unlawful Internet gambling operators and to limit unlawful Internet gaming involving United States persons. In 2006, Congress enacted the Unlawful Internet Gambling Enforcement Act, which prohibited the acceptance or processing of financial instruments for the purpose of unlawful Internet gambling, but which did not clarify which bets or wagers are prohibited by law.

Groups such as the National District Attorneys Association and the Fraternal Order of Police have expressed support for a law that clearly prohibits all unlicensed Internet gambling. Enacting such a law will aid law enforcement, prosecutors and courts in their efforts to curtail unlawful Internet gambling. On December 23, 2011, the Department of Justice released a memorandum opinion of the Office of Legal Counsel dated September 20, 2011, that construed section 1084 of title 18, United States Code (referred to as the Wire Act ), to apply only to sports-related gambling activities in interstate and foreign commerce, with the result that non-sports related Internet gambling in the United States has been found not to be prohibited under Federal law if it is lawful under State law.

A growing number of States and Indian tribes have legalized or are considering legalizing and promoting Internet gambling to generate revenue. Absent Federal limitations and enforcement, State regulation of Internet gambling, including consumer safeguards, could vary widely from State to State, and States could have difficulty enforcing Internet gambling restrictions within their borders, especially against out-of-State operators. A number of States have authorized or are considering authorizing Internet purchases of lottery subscriptions or other lottery games to generate revenue, which should not be prevented by Federal law.

Federal law needs to be updated to make clear its relationship to Internet gambling to strengthen enforcement and to ensure an effective Internet gambling enforcement structure that protects consumers and the ability of States to enforce State laws relating to Internet gambling. Since the passage of the Professional and Amateur Sports Protection Act ( Public Law 102–559 ) in 1992, which added chapter 178 to title 28, United States Code, such chapter has played an important and effective role in implementing longstanding Federal policy against gambling on professional, scholastic, and amateur sporting events.

Additional tools to assist law enforcement, banks and financial transaction providers, and Internet service providers in the prevention of unlawful Internet gambling activities would be important and beneficial. Maintenance of a list of licensed Internet gambling operators would provide a level of certainty as to permitted transactions and law enforcement efforts. Internet gambling, like much other Internet commerce, traverses State boundaries. Any particular transaction may cross a number of State boundaries from origin to destination, and communications between the same parties at different times may travel along markedly different routes, based on factors such as traffic, load capacity, and other technical considerations outside the control of sender and recipient.

For that reason, among others, the Federal courts consistently have ruled that the Internet is an instrumentality and channel of interstate commerce and, as such, is subject to Congress’s plenary authority. For these same reasons, Internet gambling by its very nature implicates Federal concerns, and is different in kind and effect from traditional gambling activity. A Federal regime to regulate Internet gambling and to protect consumers should include an effective framework— to prevent underage wagering and otherwise to protect vulnerable individuals; to ensure the games are fair and are conducted honestly; to ensure that States and Indian tribes that wish to prohibit Internet gambling may do so; to promote the ability of State and Tribal lotteries to generate revenue for the jurisdictions that license them; and to facilitate the enforcement of Federal, State, and tribal laws against unauthorized Internet gambling.

To avoid uneven treatment of Internet gambling and land-based gambling and the risk of discrimination against existing land-based gambling operations and States that have authorized gambling, a Federal regime to regulate Internet gambling should contain revenue measures sufficient to ensure that Internet gambling activities generate at least equivalent revenues for the Federal Government and the States combined as they would generate if the gambling was carried out at land-based operations.

Federal regulation of Internet gambling should be designed and implemented to foster a level-playing field among all forms of traditional gambling and all types of Internet gambling operators, including casinos, Indian tribes offering gambling services, State-licensed lotteries, horseracing, and any other form of gambling that is not sports-related, as well as among Internet companies with relevant expertise in e-commerce who meet the same qualifications as traditional casinos for integrity and for the capacity to carry out Internet gambling operations that meet applicable Federal and State standards.

Connections3 off-index

3 references not yet in our index

Pub. L. 109-347
120 Stat. 1952
Pub. L. 102-559

Citation graph

cites case law

Sec. 101

Findings

Pub. L.Pub. L. 109-347

Stat.120 Stat. 1952

Pub. L.Pub. L. 102-559

Cites 3Cited by 0 across 0 sources