71st OREGON LEGISLATIVE ASSEMBLY--2001 Regular Session
 
NOTE:  Matter within  { +  braces and plus signs + } in an
amended section is new. Matter within  { -  braces and minus
signs - } is existing law to be omitted. New sections are within
 { +  braces and plus signs + } .
 
LC 546
 
                           A-Engrossed
 
                         Senate Bill 755
                 Ordered by the Senate March 28
           Including Senate Amendments dated March 28
 
Sponsored by Senator METSGER
 
 
                             SUMMARY
 
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure.
 
  Prohibits use of credit cards, checks or electronic funds
transfers in collection of   { - Internet gambling - }
debts { +  from unlawful gambling using Internet + }. Punishes
violations by maximum $100,000 fine or five years' imprisonment,
or both.  { + Exempts activities licensed and regulated by Oregon
Racing Commission. + } Provides exemptions for financial
institutions. Specifies that financial institutions may collect
 { - Internet gambling - }   { + on + } debts   { - paid in
violation of law - }  { +  arising out of unlawful gambling using
Internet + }.
 
                        A BILL FOR AN ACT
Relating to Internet gambling; creating new provisions; and
  amending ORS 167.116 and 167.117.
Be It Enacted by the People of the State of Oregon:
  SECTION 1. Sections 2 to 5 of this 2001 Act are added to and
made a part of ORS 167.117 to 167.164.
  SECTION 2.  { + (1) A person engaged in an Internet gambling
business may not knowingly accept, in connection with the
participation of another person in unlawful gambling using the
Internet:
  (a) Credit, or the proceeds of credit, extended to or on behalf
of such other person, including credit extended through the use
of a credit card;
  (b) An electronic funds transfer or funds transmitted by or
through a money transmission business, or the proceeds of an
electronic funds transfer or money transmission service, from or
on behalf of the other person;
  (c) Any check, draft or similar instrument that is drawn by or
on behalf of the other person and is drawn on or payable at or
through any financial institution; or
  (d) The proceeds of any other form of financial transaction
that involves a financial institution as a payor or financial
intermediary on behalf of or for the benefit of the other person.
  (2) Violation of subsection (1) of this section is a Class C
felony. + }
  SECTION 3.  { + (1) A creditor, credit card issuer, financial
institution, operator of a terminal at which an electronic funds
transfer may be initiated, money transmission business or any
national, regional or local network utilized to effect a credit
transaction, electronic funds transfer or money transmission
service shall not be liable under section 2 of this 2001 Act
unless the creditor, issuer, financial institution, operator or
network knowingly participates in any activity prohibited by
section 2 of this 2001 Act or acts as an agent or representative
of an Internet gambling business.
  (2) Notwithstanding any other provision of law, a creditor,
credit card issuer, financial institution, operator of a terminal
at which an electronic funds transfer may be initiated, money
transmission business or any national, regional or local network
utilized to effect a credit transaction, electronic funds
transfer or money transmission service that is not liable under
section 2 of this 2001 Act may collect on any debt arising out of
activities that are illegal under section 2 of this 2001 Act. + }
  SECTION 4.  { + As used in sections 2 and 3 of this 2001 Act:
  (1) 'Credit' and 'Credit card' have the meaning given those
terms under the federal Consumer Credit Protection Act
(P.L. 90-321, 82 Stat. 146, 15 U.S.C. 1601).
  (2) 'Electronic funds transfer' has the meaning given that term
in ORS 293.525.
  (3) 'Financial institution' has the meaning given that term in
ORS 706.008.
  (4) 'Money transmission' has the meaning given that term in ORS
717.200. + }
  SECTION 5.  { + Sections 2 and 3 of this 2001 Act do not apply
to activities licensed and regulated by the Oregon Racing
Commission under ORS chapter 462. + }
  SECTION 6. ORS 167.116 is amended to read:
  167.116. (1) The Oregon State Lottery Commission shall adopt
rules to carry out the provisions of ORS 167.117 (9)(c)(E) and
  { - (19)(b) - }  { +  (20)(b) + }.
  (2) Devices authorized by the Oregon State Lottery Commission
for the purposes described in ORS 167.117 (9)(c)(E) and
 { - (19)(b) - }  { +  (20)(b) + } are exempted from the
provisions of 15 U.S.C. 1172.
  SECTION 7. ORS 167.117 is amended to read:
  167.117. As used in ORS 167.117 to 167.164 and 464.270 to
464.530, unless the context requires otherwise:
  (1) 'Bingo or lotto' means a game, played with cards bearing
lines of numbers, in which a player covers or uncovers a number
selected from a container, and which is won by a player who is
present during the game and who first covers or uncovers the
selected numbers in a designated combination, sequence or
pattern.
  (2) 'Bookmaker' means a person who unlawfully accepts a bet
from a member of the public upon the outcome of a future
contingent event and who charges or accepts a percentage, fee or
vigorish on the wager.
  (3) 'Bookmaking' means promoting gambling by unlawfully
accepting bets from members of the public as a business, rather
than in a casual or personal fashion, upon the outcomes of future
contingent events.
  (4) 'Casino game' means any of the traditional gambling-based
games commonly known as dice, faro, monte, roulette, fan-tan,
twenty-one, blackjack, Texas hold-'em, seven-and-a-half, big
injun, klondike, craps, poker, chuck-a-luck, Chinese chuck-a-luck
(dai shu), wheel of fortune, chemin de fer, baccarat, pai gow,
beat the banker, panquinqui, red dog, acey-deucey, or any other
gambling-based game similar in form or content.
  (5)(a) 'Charitable, fraternal or religious organization ' means
any person that is:
  (A) Organized and existing for charitable, benevolent,
eleemosynary, humane, patriotic, religious, philanthropic,
 
recreational, social, educational, civic, fraternal or other
nonprofit purposes; and
  (B) Exempt from payment of federal income taxes because of its
charitable, fraternal or religious purposes.
  (b) The fact that contributions to an organization profiting
from a contest of chance do not qualify for a charitable
deduction for tax purposes or that the organization is not
otherwise exempt from payment of federal income taxes pursuant to
the Internal Revenue Code of 1986, as amended, constitutes prima
facie evidence that the organization is not a bona fide
charitable, fraternal or religious organization.
  (6) 'Contest of chance' means any contest, game, gaming scheme
or gaming device in which the outcome depends in a material
degree upon an element of chance, notwithstanding that skill of
the contestants may also be a factor therein.
  (7) 'Gambling' means that a person stakes or risks something of
value upon the outcome of a contest of chance or a future
contingent event not under the control or influence of the
person, upon an agreement or understanding that the person or
someone else will receive something of value in the event of a
certain outcome. 'Gambling' does not include:
  (a) Bona fide business transactions valid under the law of
contracts for the purchase or sale at a future date of securities
or commodities, and agreements to compensate for loss caused by
the happening of chance, including but not limited to contracts
of indemnity or guaranty and life, health or accident insurance.
  (b) Engaging in contests of chance under the following
conditions:
  (A) The contest is played for some token other than money;
  (B) An individual contestant may not purchase more than $100
worth of tokens for use in the contest during any 24-hour period;
  (C) The tokens may be exchanged only for property other than
money;
  (D) Except when the tokens are exchanged for a beverage or
merchandise to be consumed on the premises, the tokens are not
redeemable on the premises where the contest is conducted or
within 50 miles thereof; and
  (E) Except for charitable, fraternal or religious
organizations, no person who conducts the contest as owner, agent
or employee profits in any manner from operation of the contest.
  (c) Social games.
  (d) Bingo, lotto or raffle games or Monte Carlo events operated
in compliance with ORS 167.118, by a charitable, fraternal or
religious organization licensed pursuant to ORS 167.118, 464.250
to 464.380 and 464.420 to 464.530 to operate such games.
  (8) 'Gambling device' means any device, machine, paraphernalia
or equipment that is used or usable in the playing phases of
unlawful gambling, whether it consists of gambling between
persons or gambling by a person involving the playing of a
machine. Lottery tickets, policy slips and other items used in
the playing phases of lottery and policy schemes are not gambling
devices within this definition. Amusement devices other than gray
machines, that do not return to the operator or player thereof
anything but free additional games or plays, shall not be
considered to be gambling devices.
  (9)(a) 'Gray machine' means any electrical or
electro-mechanical device, whether or not it is in working order
or some act of manipulation, repair, adjustment or modification
is required to render it operational, that:
  (A) Awards credits or contains or is readily adaptable to
contain, a circuit, meter or switch capable of removing or
recording the removal of credits earned by a player, other than
removal during the course of continuous play; or
  (B) Plays, emulates or simulates a casino game, bingo or keno.
 
 
  (b) A device is no less a gray machine because, apart from its
use or adaptability as such, it may also sell or deliver
something of value on the basis other than chance.
  (c) 'Gray machine' does not include:
  (A) Any device commonly known as a personal computer, including
any device designed and marketed solely for home entertainment,
when used privately and not for a fee and not used to facilitate
any form of gambling;
  (B) Any device operated under the authority of the Oregon State
Lottery;
  (C) Any device manufactured or serviced but not operated in
Oregon by a manufacturer who has been approved under rules
adopted by the Oregon State Lottery Commission;
  (D) A slot machine; or
  (E) Any device authorized by the Oregon State Lottery
Commission for:
  (i) Display and demonstration purposes only at trade shows; or
  (ii) Training and testing purposes by the Department of State
Police.
  (10) 'Handle' means the total amount of money and other things
of value bet on the bingo, lotto or raffle games, the value of
raffle chances sold or the total amount collected from the sale
of imitation money during Monte Carlo events.
   { +  (11) 'Internet' means an interactive computer service or
system or an information service, system or access software
provider that provides or enables computer access by multiple
users to a computer server and includes, but is not limited to,
an information service, system or access software provider that
provides access to a network system commonly known as the
Internet, or any comparable system or service and also includes,
but is not limited to a World Wide Web page, newsgroup, message
board, mailing list or chat area on any interactive computer
service or system or other on-line service. + }
    { - (11) - }   { + (12) + } 'Lottery' or 'policy' means an
unlawful gambling scheme in which:
  (a) The players pay or agree to pay something of value for
chances, represented and differentiated by numbers or by
combinations of numbers or by some other medium, one or more of
which chances are to be designated the winning ones; and
  (b) The winning chances are to be determined by a drawing or by
some other method; and
  (c) The holders of the winning chances are to receive something
of value.
    { - (12) - }  { +  (13) + } 'Monte Carlo event' means a
gambling event at which wagers are placed with imitation money
upon contests of chance in which players compete against the
house. As used in this subsection, 'imitation money' includes
imitation currency, chips or tokens.
    { - (13) - }  { +  (14) + } 'Numbers scheme or enterprise'
means a form of lottery in which the winning chances or plays are
not determined upon the basis of a drawing or other act on the
part of persons conducting or connected with the scheme, but upon
the basis of the outcome of a future contingent event otherwise
unrelated to the particular scheme.
    { - (14) - }   { + (15) + } 'Operating expenses' means those
expenses incurred in the operation of a bingo, lotto or raffle
game and related concessions, including only the following:
  (a) Salaries, employee benefits, workers' compensation coverage
and state and federal employee taxes;
  (b) Security services;
  (c) Legal and accounting services;
  (d) Supplies and inventory;
  (e) Rent, repairs, utilities, water, sewer and garbage;
  (f) Insurance;
  (g) Equipment;
  (h) Printing and promotions;
  (i) Postage and shipping;
  (j) Janitorial services and supplies; and
  (k) Leasehold improvements.
    { - (15) - }  { +  (16) + } 'Player' means a person who
engages in any form of gambling solely as a contestant or bettor,
without receiving or becoming entitled to receive any profit
therefrom other than personal gambling winnings, and without
otherwise rendering any material assistance to the establishment,
conduct or operation of the particular gambling activity. A
person who gambles at a social game of chance on equal terms with
the other participants therein is a person who does not otherwise
render material assistance to the establishment, conduct or
operation thereof by performing, without fee or remuneration,
acts directed toward the arrangement or facilitation of the game,
such as inviting persons to play, permitting the use of premises
therefor and supplying cards or other equipment used therein. A
person who engages in bookmaking is not a player.
    { - (16) - }  { +  (17) + } 'Profits from unlawful gambling'
means that a person, acting other than solely as a player,
accepts or receives money or other property pursuant to an
agreement or understanding with another person whereby the person
participates or is to participate in the proceeds of unlawful
gambling.
    { - (17) - }  { +  (18) + } 'Promotes unlawful gambling'
means that a person, acting other than solely as a player,
engages in conduct that materially aids any form of unlawful
gambling. Conduct of this nature includes, but is not limited to,
conduct directed toward the creation or establishment of the
particular game, contest, scheme, device or activity involved,
toward the acquisition or maintenance of premises, paraphernalia,
equipment or apparatus therefor, toward the solicitation or
inducement of persons to participate therein, toward the conduct
of the playing phases thereof, toward the arrangement of any of
its financial or recording phases or toward any other phase of
its operation. A person promotes unlawful gambling if, having
control or right of control over premises being used with the
knowledge of the person for purposes of unlawful gambling, the
person permits the unlawful gambling to occur or continue or
makes no effort to prevent its occurrence or continuation.
    { - (18) - }  { +  (19) + } 'Raffle' means a lottery operated
by a charitable, fraternal or religious organization wherein the
players pay something of value for chances, represented by
numbers or combinations thereof or by some other medium, one or
more of which chances are to be designated the winning ones or
determined by a drawing and the player holding the winning chance
is to receive something of value.
    { - (19)(a) - }  { +  (20)(a) + } 'Slot machine' means a
gambling device that as a result of the insertion of a coin or
other object operates, either completely automatically, or with
the aid of some physical act by the player, in such a manner
that, depending upon elements of chance, it may eject something
of value or otherwise entitle the player to something of value. A
device so constructed or readily adaptable or convertible to such
use is no less a slot machine because it is not in working order
or because some mechanical act of manipulation or repair is
required to accomplish its adaptation, conversion or workability.
Nor is it any less a slot machine because apart from its use or
adaptability as such it may also sell or deliver something of
value on the basis other than chance.
  (b) 'Slot machine' does not include any device authorized by
the Oregon State Lottery Commission for:
  (A) Display and demonstration purposes only at trade shows; or
  (B) Training and testing purposes by the Department of State
Police.
    { - (20) - }  { +  (21) + } 'Social game' means:
 
  (a) A game, other than a lottery, between players in a private
home where no house player, house bank or house odds exist and
there is no house income from the operation of the social game;
and
  (b) If authorized pursuant to ORS 167.121, a game, other than a
lottery, between players in a private business, private club or
place of public accommodation where no house player, house bank
or house odds exist and there is no house income from the
operation of the social game.
    { - (21) - }  { +  (22) + } 'Something of value' means any
money or property, any token, object or article exchangeable for
money or property, or any form of credit or promise directly or
indirectly contemplating transfer of money or property or of any
interest therein.
    { - (22) - }  { +  (23) + } 'Trade show' means an exhibit of
products and services that is:
  (a) Not open to the public; and
  (b) Of limited duration.
    { - (23) - }  { +  (24) + } 'Unlawful' means not specifically
authorized by law.
  SECTION 8.  { + Sections 2 to 5 of this 2001 Act apply to debts
first occurring on or after the effective date of this 2001
Act. + }
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