Congress tries again to restrict ‘Net gambling

John Wilen

Tuesday, March 23, 1999 | 10:44 a.m.

Sen. Jon Kyl is on the verge of re-introducing controversial federal legislation to ban Internet gambling.

Several sources said an Internet gambling bill could be introduced as early as today. A subcommittee chaired by Kyl, R-Ariz. -- the Technology, Terrorism and Government Information Subcommittee of the Senate Judiciary Committee -- began hearing testimony on Internet gambling today.

Draft versions floating around Washington include provisions that would allow substantially more Internet gambling than Kyl's Internet Gambling Prohibition Act that passed the Senate 90-10 last year.

"We're simply trying to clarify some provisions from last year," said Nevada Sen. Richard Bryan, who will co-sponsor the bill.

The bill will be similar in most respects to last year's bill, with a few notable exceptions.

While the bill will still allow authorities to punish people and companies operating Internet gambling sites with fines up to $20,000 and as much as four years in prison, Kyl is considering nixing a provision of last year's bill that would have fined individual online gamblers $500 or a multiple of their winnings.

Removal of the so-called "casual bettor provision" would mark a substantial change. Everyday Internet gamblers would be free to wager away without fear of prosecution. Law enforcement activity would focus on gambling site operators and Internet providers, who could be ordered to block access to certain sites.

In the past, talk of requiring Internet providers to block gambling sites has raised concerns that the providers would be forced to become defacto "big brothers," monitoring and controlling everything their subscribers do. Bryan said the bill will be careful to narrowly define the role of Internet providers. They will only be required to block access to sites when notified by authorities, he said. They will not be required to police the web, said Bryan.

"We do not require them to monitor, affirm or be in effect a policeman," said Bryan.

The impact of such a bill on operators is unclear. Few Internet gambling sites are actually based in the United States, preferring to locate on Caribbean Islands where Internet gambling is legal.

Also under consideration for the new bill is a provision that would allow gambling over "intrastate dial-up or password protected networks." In other words, says Las Vegas Internet gambling law expert Anthony Cabot, the bill would let states decide whether to allow Internet gambling among their citizens.

A password-protected network can be as simple as a Web site that only gives access to people with a password, said Cabot.

"That's still using the Internet," Cabot said.

According to the St. Louis-based Internet Gaming Council, the bill would also exempt from the Internet gambling ban fantasy sports leagues, parimutuel wagering, news reporting of lines and odds, posted information on how to gamble, state lotteries and wagers on horse races in jurisdictions where such wagering is legal.

"The purpose of what we are trying to do is to generally prohibit (Internet gambling) but to allow lawful activity," said Bryan.

While Kyl's Internet Gambling Prohibition Act passed the Senate overwhelmingly last year, and a similar measure sponsored by Rep. Bill McCollum, R-Fla., passed the House, there was simply no time to reconcile the two bills in conference committee, officials said.

Since the last Congress ended, Internet gambling observers have expected a new round of legislation this year.