An Assessment of Michigan Law

20 January 2000
What the heck does this new cybercrime law (Act 235) in Michigan actually mean? At a first, second, third or fourth glance it appears to prohibit online gambling, but after talking to people at several government offices in that state, it's fairly clear that that wasn't the bill's original intention.

According to a spokesperson at the Senate Majority Counsel's office, the purpose of the bill was simply to eliminate the Internet as a channel for committing sinister deeds in Michigan. They could have just as effectively scrapped the existing language and replaced it with one very uncomplicated line: "Anything that's illegal in the state of Michigan is also illegal on the Internet in the state of Michigan.

Considering that the Internet isn't contained by the borders of Michigan, such a law presents a bit of a problem. The law wasn't intended to target operators of online gambling sites both inside and outside of Michigan, but the language appears to deem such activity as illegal. The section referring to gambling basically states that anyone who violates the terms of the Michigan Gaming Control and Revenue Act over the Internet is breaking the law in Michigan. The law also appears to state that the state of Michigan also has jurisdiction over violators regardless of whether the transaction originated in Michigan. Syllogistically speaking, since operating a gambling business in Michigan without proper licensing would violate the Gaming Control and Revenue Act, and since Michigan has jurisdiction over such activity as long as part of the transaction occurs within the state, operating an online gambling site that's available to Michigan residents would be illegal. The Senate Majority Counsel's spokesperson agreed with that statement.

Since interpreting legislation feels like crapshoot, I admit that I could be off-base. If any attorneys out there see it differently, please set us straight.

Interestingly, the spokesperson informed IGN that the gambling clause was somewhat of a last-minute toss-in that received very little consideration. A motion to have that section eliminated was turned down with virtually no ado.

The Majority Counsel spokesperson, along with a spokesperson from the bill's sponsor, Senator Mike Rogers, pointed out that the drafters of the bill were careful not to supercede any of the language contained in House Bill 4689, which is specifically aimed at Internet gambling. HB 4689 passed unanimously in the House and currently resides in the Senate Committee on Gaming and Casino Oversight, where Chairman Glenn Steil is said to be ironing out some wrinkles in the language. The bill has been scrutinized because it isn't clear whether financial institutions, such as credit card processors, are violating the law by facilitating online gambling transactions. Arguments over this point could result in an amendment.

Despite the fact that the cybercrime bill passed convincingly in both houses, it isn't clear whether anyone in the Michigan Senate knows exactly what the bill means. What is clear is that neither the section on gambling nor its fallout got very much consideration because HB4689 is expected to fill in the holes. Until HB4689 is passed (it isn't considered a priority, by the way), we'll just have to stand back and throw darts at what the cybercrime act really means.

Mark Balestra

Mark Balestra is the Managing Director at BolaVerde Media Group. He previously worked at Clarion Gaming and the River City Group where he was the publisher of iGamingNews. He lives in St. Louis, Missouri.