Rep. Pete King’s New Online Poker Bill – Answers & Resources

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Rep. Pete King introduced a new federal bill today – The Internet Gambling Regulation, Enforcement, and Consumer Protection Act of 2013 – that aims to regulate various forms of online gambling.

The bill shares many similarities with (but is not identical to) Rep. John Campbell’s Internet Gambling Regulation, Consumer Protection, and Enforcement Act of 2011.


What online gambling is allowed under this bill?

Everything except for sports betting.

Who regulates online gambling under this bill?

From bullet points provided by Rep. King’s office: “The federal government retains overall jurisdiction and oversight over federal internet gambling, but relies on state expertise for licensing and enforcement under a common federal standard.”

So basically the granular work is farmed out to states & tribal entities that the federal government approves. The state & tribal entities who will handle licensing and enforcement are referred to as “qualified bodies.”

What if qualified bodies and federal regulators (or other qualified bodies) disagree on a license?

Federal regulators can rescind a license issued by a qualifying body. But they cannot overturn the decision by a qualified body to deny a license.

If two qualified bodies disagree, then the feds determine the winner.

Is the bill opt-in or opt-out?

In a nutshell: under King’s bill, states are opted-in to federal online gambling by default UNLESS:

  1. They notify federal regulators that they want out within 120 days, OR
  2. Their legislature has passed / passes a bill declaring bets authorized by the King bill “should be prohibited in such State.”

I should note that here’s a bit of confusion / difference of opinion over the opt-in / opt-out conditions of King’s bill. It’s covered in Sec. 108 of the bill, and I welcome feedback on this point.

States can change their mind.

Similar conditions apply to opt-in / opt-out for tribal authorities.

Is there a bad actor clause?

Yes and no. The bill doesn’t specifically exclude operators who have accepted US online poker action, but it does prohibit any applicant that “knowingly accepts or knowingly has accepted bets or wagers on sporting events from persons located in the United States in violation of a provision of Federal or State law.”

So anyone who ever took sports bets from the U.S. is disqualified. But numerous online poker companies – including PokerStars – have never offered sports betting to US customers (or, in Stars’ case, at all).

A number of additional provisions in the suitability section could be invoked to deny operators that formerly served the American online gambling market in any capacity – including:

  • “is delinquent in the payment of any applicable Federal or State tax”
  • “has not certified in writing, pursuant to subsection (c)(2)(G), that the person submits to personal jurisdiction in the United States”
  • “person whose prior activities, criminal record, if any, reputation, habits, and associations do not […] create or enhance the dangers of unsuitable, unfair, or illegal practices, methods, and activities in the conduct of Internet gambling facilities”

Does this bill prohibit use of credit cards for online gambling?

Apparently not. Unlike Rep. Campbell’s 2011 bill with (basically) the same name, which disallowed the use of credit cards, King’s bill does not appear to restrict their use for online gambling.

What about online gambling already regulated by states & tribes?

How does the bill handle instances where online gambling is already regulated by a state (such as poker in Nevada)? As I read it, the bill contradicts itself on this point.

One section from the bill suggesting states / tribes can do whatever they want intrastate / intra-tribal lands:

Except as expressly authorized in this title, no State or Indian tribe may authorize or operate a facility that offers Internet gambling unless the Internet gambling facility is authorized and licensed by that State or Indian tribe in compliance with the law of that State or Indian tribe, as applicable, and solely provides services to participants wholly within the boundaries of such State or the Indian lands of such Indian tribe.

But a later section seems to suggest only gambling authorized before the enactment of King’s bill is exempt:

No provision of this title shall have any effect on Internet gaming activities that are authorized and licensed by that State or Indian tribe (as the case may be) in compliance with the law of that State or Indian tribe as of the date before the date of the enactment of this Act, as applicable, and that solely provide services to participants wholly within the boundaries of that State or the Indian lands of that Indian tribe.

Timeframe until I can gamble online?

The bill mandates a 270 day waiting period after enactment before the first bet can be taken by a licensed operator.

Read more

- Chris is the publisher of Grove also serves as a consultant to various stakeholders in the regulated market for online gambling in the United States.
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