Home > 106th Congressional Bills > S. 692 (rs) To prohibit Internet gambling, and for other purposes. [Reported in Senate] ...S. 692 (rs) To prohibit Internet gambling, and for other purposes. [Reported in Senate] ...
106th CONGRESS
2d Session
S. 692
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
January 27, 2000
Referred to the Committee on the Judiciary
_______________________________________________________________________
AN ACT
To prohibit Internet gambling, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Internet Gambling Prohibition Act of
1999''.
SEC. 2. PROHIBITION ON INTERNET GAMBLING.
(a) In General.--Chapter 50 of title 18, United States Code, is
amended by adding at the end the following:
``Sec. 1085. Internet gambling
``(a) Definitions.--In this section:
``(1) Bets or wagers.--The term `bets or wagers'--
``(A) means the staking or risking by any person of
something of value upon the outcome of a contest of
others, a sporting event, or a game of chance, upon an
agreement or understanding that the person or another
person will receive something of value based on that
outcome;
``(B) includes the purchase of a chance or
opportunity to win a lottery or other prize (which
opportunity to win is predominantly subject to chance);
``(C) includes any scheme of a type described in
section 3702 of title 28; and
``(D) does not include--
``(i) a bona fide business transaction
governed by the securities laws (as defined in
section 3(a)(47) of the Securities Exchange Act
of 1934 (15 U.S.C. 78c(a)(47))) for the
purchase or sale at a future date of securities
(as defined in section 3(a)(10) of the
Securities Exchange Act of 1934 (15 U.S.C.
78c(a)(10)));
``(ii) a transaction on or subject to the
rules of a contract market designated pursuant
to section 5 of the Commodity Exchange Act (7
U.S.C. 7);
``(iii) a contract of indemnity or
guarantee; or
``(iv) a contract for life, health, or
accident insurance.
``(2) Closed-loop subscriber-based service.--The term
`closed-loop subscriber-based service' means any information
service or system that uses--
``(A) a device or combination of devices--
``(i) expressly authorized and operated in
accordance with the laws of a State,
exclusively for placing, receiving, or
otherwise making a bet or wager described in
subsection (f)(1)(B); and
``(ii) by which a person located within any
State must subscribe and be registered with the
provider of the wagering service by name,
address, and appropriate billing information to
be authorized to place, receive, or otherwise
make a bet or wager, and must be physically
located within that State in order to be
authorized to do so;
``(B) an effective customer verification and age
verification system, expressly authorized and operated
in accordance with the laws of the State in which it is
located, to ensure that all applicable Federal and
State legal and regulatory requirements for lawful
gambling are met; and
``(C) appropriate data security standards to
prevent unauthorized access by any person who has not
subscribed or who is a minor.
``(3) Foreign jurisdiction.--The term `foreign
jurisdiction' means a jurisdiction of a foreign country or
political subdivision thereof.
``(4) Gambling business.--The term `gambling business'
means--
``(A) a business that is conducted at a gambling
establishment, or that--
``(i) involves--
``(I) the placing, receiving, or
otherwise making of bets or wagers; or
``(II) the offering to engage in
the placing, receiving, or otherwise
making of bets or wagers;
``(ii) involves 1 or more persons who
conduct, finance, manage, supervise, direct, or
own all or part of such business; and
``(iii) has been or remains in
substantially continuous operation for a period
in excess of 10 days or has a gross revenue of
$2,000 or more from such business during any
24-hour period; and
``(B) any soliciting agent of a business described
in subparagraph (A).
``(5) Information assisting in the placing of a bet or
wager.--The term `information assisting in the placing of a bet
or wager'--
``(A) means information that is intended by the
sender or recipient to be used by a person engaged in
the business of betting or wagering to place, receive,
or otherwise make a bet or wager; and
``(B) does not include--
``(i) information concerning parimutuel
pools that is exchanged exclusively between or
among 1 or more racetracks or other parimutuel
wagering facilities licensed by the State or
approved by the foreign jurisdiction in which
the facility is located, and 1 or more
parimutuel wagering facilities licensed by the
State or approved by the foreign jurisdiction
in which the facility is located, if that
information is used only to conduct common pool
parimutuel pooling under applicable law;
``(ii) information exchanged exclusively
between or among 1 or more racetracks or other
parimutuel wagering facilities licensed by the
State or approved by the foreign jurisdiction
in which the facility is located, and a support
service located in another State or foreign
jurisdiction, if the information is used only
for processing bets or wagers made with that
facility under applicable law;
``(iii) information exchanged exclusively
between or among 1 or more wagering facilities
that are located within a single State and are
licensed and regulated by that State, and any
support service, wherever located, if the
information is used only for the pooling or
processing of bets or wagers made by or with
the facility or facilities under applicable
State law;
``(iv) any news reporting or analysis of
wagering activity, including odds, racing or
event results, race and event schedules, or
categories of wagering; or
``(v) any posting or reporting of any
educational information on how to make a bet or
wager or the nature of betting or wagering.
``(6) Interactive computer service.--The term `interactive
computer service' means any information service, system, or
access software provider that operates in, or uses a channel or
instrumentality of, interstate or foreign commerce to provide
or enable access by multiple users to a computer server,
including specifically a service or system that provides access
to the Internet.
``(7) Interactive computer service provider.--The term
`interactive computer service provider' means any person that
provides an interactive computer service, to the extent that
such person offers or provides such service.
``(8) Internet.--The term `Internet' means the
international computer network of both Federal and non-Federal
interoperable packet switched data networks.
``(9) Person.--The term `person' means any individual,
association, partnership, joint venture, corporation (or any
affiliate of a corporation), State or political subdivision
thereof, department, agency, or instrumentality of a State or
political subdivision thereof, or any other government,
organization, or entity (including any governmental entity (as
defined in section 3701(2) of title 28)).
``(10) Private network.--The term `private network' means a
communications channel or channels, including voice or computer
data transmission facilities, that use either--
``(A) private dedicated lines; or
``(B) the public communications infrastructure, if
the infrastructure is secured by means of the
appropriate private communications technology to
prevent unauthorized access.
``(11) State.--The term `State' means a State of the United
States, the District of Columbia, the Commonwealth of Puerto
Rico, or a commonwealth, territory, or possession of the United
States.
``(12) Subscriber.--The term `subscriber'--
``(A) means any person with a business relationship
with the interactive computer service provider through
which such person receives access to the system,
service, or network of that provider, even if no formal
subscription agreement exists; and
``(B) includes registrants, students who are
granted access to a university system or network, and
employees or contractors who are granted access to the
system or network of their employer.
``(b) Internet Gambling.--
``(1) Prohibition.--Subject to subsection (f), it shall be
unlawful for a person engaged in a gambling business knowingly
to use the Internet or any other interactive computer service--
``(A) to place, receive, or otherwise make a bet or
wager; or
``(B) to send, receive, or invite information
assisting in the placing of a bet or wager.
``(2) Penalties.--A person engaged in a gambling business
who violates this section shall be--
``(A) fined in an amount equal to not more than the
greater of--
``(i) the total amount that such person bet
or wagered, or placed, received, or accepted in
bets or wagers, as a result of engaging in that
business in violation of this section; or
``(ii) $20,000;
``(B) imprisoned not more than 4 years; or
``(C) both.
``(3) Permanent injunctions.--Upon conviction of a person
under this section, the court may enter a permanent injunction
enjoining such person from placing, receiving, or otherwise
making bets or wagers or sending, receiving, or inviting
information assisting in the placing of bets or wagers.
``(c) Civil Remedies.--
``(1) Jurisdiction.--The district courts of the United
States shall have original and exclusive jurisdiction to
prevent and restrain violations of this section by issuing
appropriate orders in accordance with this section, regardless
of whether a prosecution has been initiated under this section.
``(2) Proceedings.--
``(A) Institution by federal government.--
``(i) In general.--The United States may
institute proceedings under this subsection to
prevent or restrain a violation of this
section.
``(ii) Relief.--Upon application of the
United States under this subparagraph, the
district court may enter a temporary
restraining order or an injunction against any
person to prevent or restrain a violation of
this section if the court determines, after
notice and an opportunity for a hearing, that
there is a substantial probability that such
violation has occurred or will occur.
``(B) Institution by state attorney general.--
``(i) In general.--The attorney general of
a State (or other appropriate State official)
in which a violation of this section allegedly
has occurred or will occur, after providing
written notice to the United States, may
institute proceedings under this subsection to
prevent or restrain the violation.
``(ii) Relief.--Upon application of the
attorney general (or other appropriate State
official) of an affected State under this
subparagraph, the district court may enter a
temporary restraining order or an injunction
against any person to prevent or restrain a
violation of this section if the court
determines, after notice and an opportunity for
a hearing, that there is a substantial
probability that such violation has occurred or
will occur.
``(C) Proceedings by a sports organization.--A
professional sports organization or an amateur sports
organization (as those terms are defined in section
3701 of title 28) whose games, or the performances of
whose athletes in such games, are alleged to be the
basis of a violation of this section, may, after
providing written notice to the United States,
institute civil proceedings in an appropriate district
court of the United States to prevent or restrain such
violation. Upon application of the professional or
amateur sports organization, the district court may
enter any relief authorized by this subsection in
proceedings instituted thereunder by the United States
or a State Attorney General (or other appropriate State
official). This subparagraph does not authorize
proceedings against an interactive computer service
provider described in subsection (d)(1)(B).
``(D) Indian lands.--Notwithstanding subparagraph
(A), (B), or (C), for a violation that is alleged to
have occurred, or may occur, on Indian lands (as
defined in section 4 of the Indian Gaming Regulatory
Act (25 U.S.C. 2703))--
``(i) the United States shall have the
enforcement authority provided under
subparagraph (A); and
``(ii) in the case of an alleged violation
that involves class III gaming (as defined in
section 4 of the Indian Gaming Regulatory Act
(25 U.S.C. 2703)), the enforcement authorities
specified in an applicable Tribal-State compact
negotiated under section 11 of the Indian
Gaming Regulatory Act (25 U.S.C. 2710) shall be
carried out in accordance with that compact.
``(E) Expiration.--Any temporary restraining order
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