All -- I am pleased to announce that United States Senator Robert Menendez has introduced S. 3616, the Skill Game Licensing and Control Act of 2008. While the bill was actually introduced last Friday, the PPA has held off on announcing its introduction publically until now. Given the media climate and the focus (rightly so) on the economy and the election, this bill might not get the attention it deserves. Also this little thing in Kentucky has the attention of the gaming trades. I hope the 2+2 posters will help spread the word.

The PPA will be issuing its press release (pasted below) tomorrow as well as a e-newsletter to our 1 million plus members. So you night owls and earlybirds get a sneak peek at the bill before the masses.

Link to bill language

To be sure, the PPA does not think that this bill will pass both houses and be signed into law this year. It is however, an excellent marker for the next Congress and the new Administration. It is also the first time the Senate has acted on our issue.

S. 3616 is a bill that a poker player can love. Unlike Mr. Frank's H.R. 2046, this bill is limited to games of skill (multiplayer, non-house banked games) ... it is a true poker bill.

The bill is the product of a lot of hard work from the PPA and our lobbying team. It is also driven by the desire of Sen. Menendez to provide regulatory oversight of the industry and meaningful consumer safguards that will help midigate fraud and abuse, prevent under-age access and provide services to problem gamblers.

Given the recent scandals that have shook the confidence of the online poker community, the timing of this bill could not be better.

We look forward to improving upon this bill and advancing this issue in the U.S. Senate. I hope we can count on broad support and activism from the poker community.

John A. Pappas
Executive Director
Poker Players Alliance

PPA Applauds Introduction of S. 3616
Bill Establishes Licensing, Regulation of Internet Poker

WASHINGTON, DC. (October 1, 2008) –The Poker Players Alliance (PPA), the leading poker grassroots advocacy group with more than one million members nation-wide, today commended Senator Robert Menendez (D-NJ) for introducing S. 3616, the Internet Skill Game Licensing and Control Act. The legislation establishes the needed licensing and regulatory framework for the United States to exercise appropriate control and oversight over Internet poker and other games of skill.

“This action by Senator Menendez is yet another example that prohibitions on Internet gambling, and specifically poker, will not work to protect consumers,” said PPA Chairman and Former Senator Alfonse D’Amato. “The PPA has long advocated for thoughtful and effective licensing and regulation of online poker as a means to protect vulnerable communities, such as children and compulsive gamblers, and provide appropriate controls to thwart consumer fraud and abuse. Senator Menendez legislation is the right vehicle to achieve those goals.”

Until now legislative action in this area has been limited to the U.S. House of Representatives with Chairman Barney Frank (D-MA), sponsor of H.R. 2046, and Representative Robert Wexler (D-FL), sponsor of H.R. 2610, leading the charge for licensed and regulated poker. Senator Menendez’s bill is an exciting new development and a welcome legislative proposal of which millions of American poker players can be proud.

The introduction of S. 3616 follows a recent bipartisan victory in the House Financial Services Committee where legislation, H.R. 6870, was passed requiring clarification of the vague definition of “unlawful Internet gambling” contained in the 2006 Unlawful Internet Gambling Enforcement Act (UIGEA). Industry and regulators, including the Federal Reserve and Department of Treasury, testified to the unworkable nature of UIGEA as passed and the burden it places on the already troubled banking industry. S 3616 would provide even more clarity to the murky UIGEA and would relieve the banking industry from the ill-advised and costly burden of attempting to police private conduct at this critical economic moment in our nation’s history.

Key provisions of the bill include:

• Thorough vetting of potential licensees;
• Mandatory implementation of technologies to protect against underage gambling and to monitor and detect individuals with excessive gaming habits;
• High standards to thwart fraud and abuse of customers;
• Regulation to prevent money laundering; and,
• Processes to prevent tax avoidance.

“On behalf of the members of the PPA and online poker players nation-wide, I would like to thank Senator Menendez on his leadership on this important issue. We look forward to working with him and his Senate colleagues to enact this sound public policy,” said D’Amato.

The full text of the bill can be found at www.pokerplayersalliance.org.

Nice job John. Getting a bill dropped in the Senate was no easy feat.

Besides being a placeholder, this will put us on offense in the Senate. With Kyl there, that's not a bad thing. This should also help to keep the status quo going that much longer, as it's even more reason to defer the UIGEA regs to the next administration.

I hope we'll all let our senators know that we expect their support.

I don't know much about these things but is there any idea about how much support this is likely to get? Or way too soon to tell? Also, is this likely to get lost since there is a lot of attention going to the economy right now and with elections coming up how much attention will this type of thing get?

Also great job I know its hard to get this stuff hammered out!

When should we start contacting our Senators?

TE, you gonna do all the heavy lifting again, ie. write the letter and have it on an automailer on the PPA website, ready for us to log into?
(not that you should have any personal time for yourself or anything like that)

Nice job, guys! Just in time to write our Senators and find out who's side their on before election. Good timing.

The PPA mailer site is at http://capwiz.com/pokerplayersallian...ertid=11797686 . I just updated the letter to include the new bill. You can cut-and-paste it into the PPA system is you'd like:


I am a constituent, voter, and poker player asking for your support. Specifically, I ask that you support all proposed legislation that clearly exempts games of skill like poker from the Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA).

There are three pro-poker bills in the House. HR 6870, the Payments System Protection Act, is a reasonable compromise bill that passed the House Financial Services Committee with broad bipartisan support. It provides clarity to the vague and misguided requirements of UIGEA. HR 2610, the Skill Game Protection Act, clarifies federal law by expressly exempting games of skill like poker from UIGEA. And HR 2046, the Internet Gambling Regulation and Enforcement Act, regulates online poker via licensing of poker site operators. All three bills have rigorous safeguards against underage participation and protections for those with excessive gaming habits. All three also clarify the Wire Act to bring it into the 21st Century.

There is a pro-poker bill in the Senate as well. S 3616, the Internet Skill Game Licensing and Control Act, regulates Internet games of skill like poker via licensing and regulation of site operators. Like the House bills, S 3616 has rigorous safeguards against underage participation and protections for those with excessive gaming habits and clarifies the Wire Act.

Our right to play poker online was inadvertently restricted with the passage of UIGEA. While it is clear that the Act should not affect online poker nationwide (UIGEA only enforces other federal gaming laws...federal case law has consistently held that the Wire Act applies only to sports betting, and very few states have any laws against Internet poker), this legislation has nonetheless had a chilling effect on my ability to access and patronize these legal businesses. I ask for your help in rectifying this situation.

Additionally, our nation's financial institutions are warning the Congress that the proposed UIGEA regulations are unworkable. At the April 2, 2008 Subcommittee on Domestic and International Monetary Policy, Trade and Technology hearing on the impact of the Act on our nation's financial services industry, Louise Roseman of the Federal Reserve testified that it will be very difficult to enforce the law "without a more bright line on what is included as unlawful Internet gambling". Even if this "bright line" were defined, however, she stated that payment systems are not designed to perform this type of function. Representatives from the American Bankers Association, the Credit Union National Association, the Financial Services Roundtable and Wells Fargo fully concurred with this assessment. Dozens of other banks have submitted similar comments to the Federal Reserve and to the Treasury Department.

What's most important to me is your support for my rights. Please respond to this letter and let me know if you will support my freedoms. I will be watching your actions on this issue closely. I hope that I, along with my over one million fellow Poker Players Alliance members, can count on your support.

Thank you for your consideration.

Of course.

I imagine PPA will have to set up separate letters for reps and senators, but this will do for a couple of days.

While the PPA has been criticised for not publicizing their efforts, this bill is evidence that they are working and succeeding to advance our goals.

Great job and lets keep the mo.

Yes, it's awesome to have something in front of our senators. We have to build a foundation before hoping for more, right?

Sorry, but this bill is too much like Rep. Franks bill HR 2046. It has two major flaws; one of which is very big.

The first flaw is that it requires a mechanism to collect state, federal and Indian taxes. While this could be a 1099; it could be withholding of a percentage of all cashouts. Withholding of cashouts would quickly kill online poker.

The second flaw is that state opt out provisions. Current state laws that restrict or prohibit Internet poker likely violate the Commerce Clause of the US Constitution. This law expressly gives states the right to prohibit online poker which eliminates their Commerce Clause problem. Why give states a right that they do not likely currently possess. If the PPA has to fight in each state to prevent them from opting out, then the fight will be very expensive and IMO a loss in the majority of states. The PPA should insist that these provision be deleted and oppose any bill with them.

Also, the bill contains requirements that foreign sites will have substantial difficulty meeting. They include some office within 500 miles of US and agreement to be subject to the jurisdiction of US courts. Moreover, any foreign online poker site that decides not to obtain this license will definitely be violating US law if it provides online poker to US citizens. Currently, such sites do not likely violate any federal law and any state law that they violate likely violates the Commerce Clause.

Rep. Wexler's bill HR2610 is far better for online poker. I hope that this bill never sees the light of day.

Sites like Worldwinner and the other "skill sites" have no problem with this. You get a 1099 automatically generated and mailed at the end of the year and thats the end of it. If you need something for quarterlies, I'm sure they accomodate that also. This is very simple.

Agree that this could cause problems, but not sure if this is one of the concessions needed to get the bill passed. Again, this is a concern for me also as I live in a VERY red state.

I thought the point was to get US sites to enter the market in a regulated environment. The fish are going to want to play on the sites they feel comfortable with. WWW.Harrahs.com for poker should be very fishy, to say the least. If the foreign sites really see this as a lucrative market, they'll get an office on US soil, that will not be something that holds them back. If the process is open to them to get licensed and then they choose not to.... that should be enough of a warning to anyone even thinking of putting their money in there.

Except for the opt out provision, I don't share the same concerns that you have.

We wouldn't have Wexler's bill without IGREA. We used IGREA to build our support base, enabling the Wexler bill's introduction. In the same manner, hopefully this bill will be a great opportunity for us to tell the Senate that we expect them to support our rights. Keep in mind that the Senate once voted 90-10 to ban all online gaming (aside from horses and the lottery).

To be honest, I don't think there will ever be a bill that forces poker on every state. If poker players insist on that, I think we'll have no bills and will be reduced to staying on defense.

Anyway, this bill likely won't pass into law this session, as there isn't much time remaining. What it will do is give us a bill to rally around, keeping us on offense and keeping the status quo. It will also let Kyl and FoF know that poker players are the real deal.

Well said on all of your points.

As for the opt-outs, states can and do opt out of skill game sites like Worldwinner as well, as you know. So, no real difference there.

States do not really opt out of the skill games. Sites offering these skill games do not offer them to citizens in some states because they feel that doing so violates that state's laws. In fact, states may not be able to prohibit these skill games under the Commerce Clause. IMO the skill game sites are operating under the radar of the states and DOJ because any money wagered on them is so small. Poker is as much skill as most of these so-called skill games, but online poker involves much more money. Thus, Kentucky attempts to seize online poker sites domains, but not those of the skill game sites.

IMO, we are better off under the status quo than under a law that gives states the power to prohibit online poker under the Commerce Clause (if they, or the federal governmetnt have that power under the US Constitution see the iMEGA appellate brief). Also, the state opt out provision does away with any skill v. luck issue. IMO if the states can prohibit online poker, then the majority will do so unless they get substantial taxes from it that will cause a rake that destroys any potential player profit. This will prevent the fish from playing. The Internet should be governed by the federal government and not the states; if it must be governed. IMO the PPA should oppose the state opt out provision for online poker.

On the other provisions that I find troublesome:

If the mechanism to collect taxes is clearly stated to be a required 1099, then that is ok, but the bill should so state. Otherwise, the regulators may require withholding from cashouts which make transferring funds between the sites impossible and will drive the fish away for good.

I can see the point about foreign sites being able to comply with the office and jurisdiction requirements. However, it does limit competition, but any government regulation does that job.