MENENDEZ INTRODUCES LEGISLATION TO REGULATE ONLINE POKER AND GAMES OF SKILL
By Senator Robert Menendez
WASHINGTON – U.S. Senator Robert Menendez (D-NJ) today introduced the Internet Poker and Games of Skill Regulation, Protection and Enforcement Act, legislation that would allow federally-regulated online poker and other games of skill. The legislation is designed to raise revenue while protecting families through a crackdown on predatory internet gaming sites that target minors and fleece their customers. Estimates have shown that more than $3 billion in annual revenue can be raised by licensing and regulating Internet poker.
“Pulling Internet poker out of the shadows and into the light of the law, we have the opportunity to help our economy while protecting our families,” said Menendez. “By bringing these games of skill into the mainstream, we can generate billions in revenue for businesses and the Treasury during these tough times. The safety benefits of the bill are particularly crucial. Parents are worried about their children falling prey to illegitimate gaming sites and thousands of Americans have been fleeced of millions of dollars by these sites. With proper regulation, we can prevent minors from playing poker online, crackdown on predatory operations, and sanction the legitimate ones.”
Details of legislation:
SUMMARY:
This legislation provides a licensing, regulatory and taxation framework to establish a legitimate online skill game industry in the United States, while creating enhanced enforcement against those who accept illegal Internet gambling from the United States.
LICENSING:
• Require applicants to undergo a thorough review by the Department including the financial condition of applicant, business record, and background checks
• In addition to any further documentation requested by the Department, the applicant must submit a full financial statement, corporate structure documentation, and a certification that applicant agrees to be subject to US gambling laws.
• The burden of proof is on the licensees. The Department has wide latitude to deny licenses for anybody who they do not feel meets the criteria set by the Department for honesty, integrity, business probity, and experience, and financial capabilities facility.
• Automatic denial to anybody previously convicted anywhere in the world of gambling, financial, or information security law.
• License term will be five years in length; renewal subject to same requirements
• License will be revoked for failure to comply with any provision in this legislation, or conviction of a crime that would lead to denial of license.
REGULATION:
• Any state or Indian tribe can opt out of regulations, and it will be illegal to accept bets from individuals residing in these jurisdictions.
• Treasury must require periodic financial reports from each licensees; and in turn submit an annual report to Congress on the status of the online skill game industry.
• Violations of this legislation will be punished by fines and prison terms of a maximum of 5 years.
CONSUMER PROTECTION:
This legislation directs the Department of the Treasury to develop the following regulations that licensess must follow in order to retain their license:
• Appropriate Safeguards to ensure age verification
• Ensure bettors are physically located in a jurisdiction where gambling is legal.
• Ensure all taxes due are collected
• Safeguards to combat fraud and money laundering.
• Safeguards to ensure games are fair.
• Safeguards to combat compulsive internet gambling
• Privacy safeguards for bettors
• Any other safeguards the Director of FCEN believes necessary
TAXATION:
This legislation imposes appropriate taxes on providers of Internet games of skill, which can yield billions of needed dollars state and Federal government.
• Licensed sites must pay a 10% tax on all deposits into playing accounts, the proceeds of which are split evenly between the federal government and the government of the state where the player is situated.
• Appropriate witholding of taxes on the net winnings of players.
• Appropriate payment of corporate taxes by licensed companies.
*******************************************************
Also included in the Menendez bill is a 50% tax on all deposits made to online sportsbooks (unlicensed operators), due to the IRS at the end of every month. The player depositing is the one responsible for paying this.
The same tax is in the Frank bill so they probably won't take it out. Somebody please tell me I am missing something here or do we need to do all we can do to keep these bills from passing?
By Senator Robert Menendez
WASHINGTON – U.S. Senator Robert Menendez (D-NJ) today introduced the Internet Poker and Games of Skill Regulation, Protection and Enforcement Act, legislation that would allow federally-regulated online poker and other games of skill. The legislation is designed to raise revenue while protecting families through a crackdown on predatory internet gaming sites that target minors and fleece their customers. Estimates have shown that more than $3 billion in annual revenue can be raised by licensing and regulating Internet poker.
“Pulling Internet poker out of the shadows and into the light of the law, we have the opportunity to help our economy while protecting our families,” said Menendez. “By bringing these games of skill into the mainstream, we can generate billions in revenue for businesses and the Treasury during these tough times. The safety benefits of the bill are particularly crucial. Parents are worried about their children falling prey to illegitimate gaming sites and thousands of Americans have been fleeced of millions of dollars by these sites. With proper regulation, we can prevent minors from playing poker online, crackdown on predatory operations, and sanction the legitimate ones.”
Details of legislation:
SUMMARY:
This legislation provides a licensing, regulatory and taxation framework to establish a legitimate online skill game industry in the United States, while creating enhanced enforcement against those who accept illegal Internet gambling from the United States.
LICENSING:
• Require applicants to undergo a thorough review by the Department including the financial condition of applicant, business record, and background checks
• In addition to any further documentation requested by the Department, the applicant must submit a full financial statement, corporate structure documentation, and a certification that applicant agrees to be subject to US gambling laws.
• The burden of proof is on the licensees. The Department has wide latitude to deny licenses for anybody who they do not feel meets the criteria set by the Department for honesty, integrity, business probity, and experience, and financial capabilities facility.
• Automatic denial to anybody previously convicted anywhere in the world of gambling, financial, or information security law.
• License term will be five years in length; renewal subject to same requirements
• License will be revoked for failure to comply with any provision in this legislation, or conviction of a crime that would lead to denial of license.
REGULATION:
• Any state or Indian tribe can opt out of regulations, and it will be illegal to accept bets from individuals residing in these jurisdictions.
• Treasury must require periodic financial reports from each licensees; and in turn submit an annual report to Congress on the status of the online skill game industry.
• Violations of this legislation will be punished by fines and prison terms of a maximum of 5 years.
CONSUMER PROTECTION:
This legislation directs the Department of the Treasury to develop the following regulations that licensess must follow in order to retain their license:
• Appropriate Safeguards to ensure age verification
• Ensure bettors are physically located in a jurisdiction where gambling is legal.
• Ensure all taxes due are collected
• Safeguards to combat fraud and money laundering.
• Safeguards to ensure games are fair.
• Safeguards to combat compulsive internet gambling
• Privacy safeguards for bettors
• Any other safeguards the Director of FCEN believes necessary
TAXATION:
This legislation imposes appropriate taxes on providers of Internet games of skill, which can yield billions of needed dollars state and Federal government.
• Licensed sites must pay a 10% tax on all deposits into playing accounts, the proceeds of which are split evenly between the federal government and the government of the state where the player is situated.
• Appropriate witholding of taxes on the net winnings of players.
• Appropriate payment of corporate taxes by licensed companies.
*******************************************************
Also included in the Menendez bill is a 50% tax on all deposits made to online sportsbooks (unlicensed operators), due to the IRS at the end of every month. The player depositing is the one responsible for paying this.
The same tax is in the Frank bill so they probably won't take it out. Somebody please tell me I am missing something here or do we need to do all we can do to keep these bills from passing?
