The Skill Game Protection Act
H.R. 2610

Problem:
Seventy million Americans enjoy the challenge and competition of playing poker.  Of these seventy million citizens, several million played with one another on the World Wide Web.  Upon the passage of the Unlawful Internet Gambling Enforcement Act (UIGEA) in September of 2006, these otherwise law-abiding citizens were suddenly doing something illegal.  The UIEGA prohibits on internet gaming of all sorts, and fails to acknowledge the difference between gambling on total chance, and games in which the wining is determined by a participant’s skill level.  Since it came into effect, the UIGEA has made fun and easy online gambling illegal, prohibiting millions of Americans from participating in a popular – and traditionally American -- pastime.  If Americans do participate in online gaming, they do so through websites based in countries with no regulations and safeguards. 

Solution:
Playing poker is not a crime.  Rather than pretend online poker does not exist, as current law does now, the United States should address it in a pragmatic way and regulate it, similar to how states control lotteries.  To accomplish this, I have introduced the Skill Game Protection Act.  Under the Skill Game Protection Act, games of skill, such as, poker, mah-jong, bridge, chess, and others will be classified by law as games of skill.  So long as participants compete against one another, and not “against the house,” these online games will be legal.  Along with the allowance of skill-oriented games, the bill includes safe-guards to prevent minors, and those with, or likely-hood of having, a gambling addiction from participating in online gaming.  The bill also protects American’s basic privacy rights and security from fraud or money laundering.

Bill Text:

SECTION 1. Short Title
This Act shall be known as the "Skill Game Protection Act."

SEC. 2. Congressional Findings
(1). Millions of Americans enjoy competing with other players in a variety of games of skill, including bridge, mah-jong, backgammon and poker, over the Internet, where the operator provides the Internet venue for competition and receives a fee for such service. For some Americans, these games provide their primary source of income.
(2). While each of these games contains an element of chance, over any substantial interval, a player's success at any of these games is determined by that player's relative level of skill and is widely recognized as such.
3). Games where success is predominantly determined by the skill of the players involved, as a matter of law and of policy, are distinct from the games of chance traditionally described and addressed in federal and state gambling statutes.
(4). Despite the fact the language of the Wire Act (18 USC 1084) has been interpreted by federal courts as applying only to betting on sports, some in law enforcement interpret the Act as prohibiting the acceptance of both sports and non-sports betting - through a communications device.
(5). The Federal Government should take appropriate steps to ensure that, with respect to skill games, minors are prevented from playing for money; persons with compulsive behavior should be identified and referred to treatment; operators of such games should not be vulnerable to, or participate in criminal or terrorist money laundering, and appropriate taxes are collected.

SEC. 3. Clarification
Section 1084 of Title 18, United States Code, is amended by adding at the end the following:
"(f) As used in this section, the term "bets or wagers" shall not include operating, or participation in poker, chess, bridge, mahjong or any other game where success is predominantly determined by a player's skill, provided:
(1) the game provides for competition only between and among participants, and not against the person operating the game; and,
(2) the operator is in compliance with regulations issued pursuant to Section 5368 of Title 31, United States Code.

SEC. 4. Safeguards
Chapter 53 of title 31, United States Code, is amended by adding at the end the following:
"Sec . 5368. Games of Skill.
No later than 180 days after enactment, the Secretary shall issue regulations setting forth requirements for any person operating a game of skill on the Internet to provide that such operator shall maintain:
(1) Appropriate safeguards to ensure that the individual participant depositing funds is 18 years of age or older.
(2) Appropriate safeguards to ensure that the individual participant is physically located in a jurisdiction that does not bar participation in the particular Internet games of skill in which the individual participates at the time in the individual participates.
(3) Appropriate mechanisms to ensure that all taxes relating to Internet games of skill due to Federal and State governments and to Indian tribes from individual participants are collected at the time of any payment of any proceeds of Internet games of skill.
(4) Appropriate mechanisms to ensure that all taxes relating to Internet games of skill due to Federal and State governments and to Indian tribes from any licensee are collected as required by law.
(5) Appropriate safeguards to combat fraud and money laundering as may be prescribed by regulations issued by the Secretary or his designee.
(6) Appropriate safeguards to combat compulsive participation in Internet games of skill.
(7) Appropriate safeguards to protect the privacy and security of any person engaged in Internet games of skill.

SEC. 5. Rule of Construction
Section 5362 of Title 31, United
States Code, is amended by adding at the end of Paragraph (1)(E), the following:
"(x) participation in any activity operated in compliance with regulations issued pursuant to Section 5368 and which does not constitute "bets or wagers" within the meaning of 18 USC 1084(f).

SEC. 6. Rule of Construction
Nothing in this Act shall be construed as stipulating that 18 U.S.C.1084 applies or did apply before or after enactment of this Act to non-sports wagering."
 

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