Sen. Kwame Raoul

Filed: 5/25/2017

 

 


 

 


 
10000SB0208sam001LRB100 04954 AMC 27129 a

1
AMENDMENT TO SENATE BILL 208

2    AMENDMENT NO. ______. Amend Senate Bill 208 by replacing
3everything after the enacting clause with the following:
 
4
"Article 1. Fantasy Sports Contest Act

 
5    Section 1-1. Short title. This Article may be cited as the
6Fantasy Sports Contest Act. References in this Article to "this
7Act" mean this Article.
 
8    Section 1-5. Legislative intent.
9    (a) The General Assembly hereby finds and declares that:
10        (1) Interactive fantasy sports contests are contests
11    of skill in which fantasy or simulation teams are selected
12    based upon the skill and knowledge of the participants and
13    not based solely on the membership of an actual team.
14        (2) Interactive fantasy sports contests are not wagers
15    on future contingent events not under the contestants'

 

 

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1    control or influence because contestants have control over
2    which players they choose and the outcome of each contest
3    is not dependent upon the performance of any one player or
4    any one actual team. The outcome of any interactive fantasy
5    sports contest does not correspond to the outcome of any
6    one real-life competitive event. Instead, the outcome
7    depends on how the performances of participants' fantasy
8    roster choices compared to the performance of others'
9    roster choices.
10    (b) Based on the findings in this Section, the General
11Assembly declares that interactive fantasy sports contests do
12not constitute gambling as defined in Section 28-1 of the
13Criminal Code of 2012.
14    (c) The General Assembly further finds that as the Internet
15has become an integral part of society, and interactive fantasy
16sports contests a major form of entertainment for many
17consumers, any interactive fantasy sports enforcement and
18regulatory structure must begin from the bedrock premise that
19participation in a lawful and licensed interactive fantasy
20sports industry is a privilege and not a right, and that
21regulatory oversight is intended to safeguard the integrity of
22the games and participants and to ensure accountability and the
23public trust.
 
24    Section 1-10. Definitions. As used in this Act:
25    "Authorized player" means an individual located in this

 

 

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1State that participates in an interactive fantasy sports
2contest offered by an interactive fantasy sports operator.
3    "Beginner fantasy sports player" means an individual who is
4at least 21 years of age and who has entered fewer than 51
5interactive fantasy sports contests offered by a single
6interactive fantasy sports operator.
7    "Board" means the Illinois Gaming Board.
8    "Collegiate sport or athletic event" means a sport or
9athletic event offered or sponsored by or played in connection
10with a public or private institution that offers education
11services beyond the secondary level.
12    "Entry fee" means cash or cash equivalent that is paid by
13an authorized player to an interactive fantasy sports operator
14to participate in an interactive fantasy sports contest offered
15by that interactive fantasy sports operator.
16    "High school sport or athletic event" means a sport or
17athletic event offered or sponsored by or played in connection
18with a public or private institution that offers education
19services at the secondary level.
20    "Highly experienced player" means an authorized player who
21has:
22        (1) entered more than 1,000 interactive fantasy sports
23    contests offered by a single interactive fantasy sports
24    operator; or
25        (2) won more than 3 prizes valued at $1,000 each or
26    more from a single interactive fantasy sports operator.

 

 

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1    "Interactive fantasy sports contest" means a fantasy
2contest, in which:
3        (1) the value of all prizes and awards offered to
4    winning participants are established and made known to the
5    participants in advance of the contest and their value is
6    not determined by the number of participants or the amount
7    of any fees paid by those participants;
8        (2) all winning outcomes are determined predominantly
9    by accumulated statistical results of the performance of
10    individual athletes in real-world professional athletic
11    competitions; a professional athletic competition does not
12    include any amateur or collegiate level sport; and
13        (3) no winning outcome is based on the score, point
14    spread, or any performance or performances of any single
15    actual team or combination of such teams or solely on any
16    single performance of an individual athlete or player in
17    any single actual event.
18    "Interactive fantasy sports gross revenue" means the
19amount equal to the total of all entry fees that an interactive
20fantasy sports operator collects from all players, multiplied
21by the location percentage for the State.
22    "Interactive fantasy sports operator" means a person or
23entity that engages in the business of offering, by means of
24the Internet, a smart phone application, or other similar
25electronic or digital media or communication technologies,
26multiple interactive fantasy sports contests to persons.

 

 

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1    "Interactive fantasy sports platform" means any website,
2smart phone application, or other portal providing access to an
3interactive fantasy sports contest.
4    "Location percentage" means, for each interactive fantasy
5sports contest, the percentage, rounded to the nearest tenth of
6a percent, of the total entry fees collected by an interactive
7fantasy sports operator from players located in this State,
8divided by the total entry fees collected by an interactive
9fantasy sports operator from all players in interactive fantasy
10sports contests.
11    "Minor" means a person under the age of 21 years.
12    "Permitted sports event" means a professional sport or
13athletic event or other competitive event. "Permitted sports
14event" does not include a prohibited sports event.
15    "Prohibited sports event" means an amateur sport or
16athletic event, a collegiate sport or athletic event, or a high
17school sport or athletic event.
 
18    Section 1-15. Applicability. This Act and all rules adopted
19under the authority of this Act shall apply only to interactive
20fantasy sports contests for which an authorized player pays an
21entry fee.
 
22    Section 1-20. Licensing.
23    (a) No interactive fantasy sports operator shall
24administer, manage, or otherwise make available an interactive

 

 

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1fantasy sports platform to persons located in the State unless
2licensed by the Board under this Act.
3    (b) A qualified person may apply to the Board for an
4interactive fantasy sports operator license to conduct
5interactive fantasy sports contests as provided in this Act.
6The application shall be made on forms provided by the Board.
7The burden is upon each applicant to demonstrate suitability
8for licensure. Each interactive fantasy sports operator shall
9be licensed by the Board. The Board may issue a license for a
10period of up to 2 years or, in the case of interactive fantasy
11sports operators with annual interactive fantasy sports gross
12revenues less than $100,000, for up to 3 years.
13    (c) Each person seeking and possessing a license as an
14interactive fantasy sports operator shall submit to a
15background investigation conducted by the Board with the
16assistance of the State Police or other law enforcement. To the
17extent that the corporate structure of the applicant allows,
18the background investigation shall include any or all of the
19following as the Board deems appropriate or as provided by
20rule: (i) each beneficiary of a trust, (ii) each partner of a
21partnership, (iii) each member of a limited liability company,
22(iv) each director and officer of a publicly or non-publicly
23held corporation, (v) each stockholder of a non-publicly held
24corporation, (vi) each stockholder of 5% or more of a publicly
25held corporation, or (vii) each stockholder of 5% or more in a
26parent or subsidiary corporation.

 

 

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1    (d) Each person seeking and possessing a license as an
2interactive fantasy sports operator shall disclose the
3identity of every person, association, trust, corporation, or
4limited liability company having a greater than 1% direct or
5indirect pecuniary interest in the interactive fantasy sports
6operator for which the license is sought. If the disclosed
7entity is a trust, the application shall disclose the names and
8addresses of the beneficiaries; if a corporation, the names and
9addresses of all stockholders and directors; if a limited
10liability company, the names and addresses of all members; or
11if a partnership, the names and addresses of all partners, both
12general and limited.
13    (e) All information, records, interviews, reports,
14statements, memoranda, or other data supplied to or used by the
15Board in the course of its review or investigation of an
16application for a license or a renewal under this Act shall be
17privileged and strictly confidential and shall be used only for
18the purpose of evaluating an applicant for a license or a
19renewal. The information, records, interviews, reports,
20statements, memoranda, or other data shall not be admissible as
21evidence nor discoverable in any action of any kind in any
22court or before any tribunal, board, agency, or person, except
23for any action deemed necessary by the Board.
24    (f) No person may be licensed as an interactive fantasy
25sports operator if that person has been found by the Board to:
26        (1) have a background, including a criminal record,

 

 

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1    reputation, habits, social or business associations, or
2    prior activities, that poses a threat to the public
3    interests of the State or to the security and integrity of
4    interactive fantasy sports contests;
5        (2) create or enhance the dangers of unsuitable,
6    unfair, or illegal practices, methods, and activities in
7    the conduct of interactive fantasy sports contests; or
8        (3) present questionable business practices and
9    financial arrangements incidental to the conduct of
10    interactive fantasy sports contests.
11    (g) Any applicant for a license under this Act has the
12burden of proving his or her qualifications to the satisfaction
13of the Board. The Board may adopt rules to establish additional
14qualifications and requirements to preserve the integrity and
15security of interactive fantasy sports contests in this State.
16    (h) An interactive fantasy sports operator that has been
17operating in Illinois for at least 6 months on December 23,
182015 may operate in Illinois until a final decision is rendered
19on the application for an interactive fantasy sports operator
20license.
21    (i) The Board, by rule, shall establish a process for
22license renewal.
23    (j) The Board shall publish a list of all interactive
24fantasy sports operators licensed in this State under this
25Section on the Board's website for public use.
 

 

 

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1    Section 1-25. Operators; required safeguards; minimum
2standards.
3    (a) As a condition of licensure in this State, each
4interactive fantasy sports operator shall implement and
5maintain commercially reasonable measures to:
6        (1) limit each authorized player to one username and
7    one account and verify a fantasy sports player's true
8    identity;
9        (2) prohibit minors from participating in an
10    interactive fantasy sports contest, including:
11            (A) if the interactive fantasy sports operator
12        becomes or is made aware that a minor has participated
13        in one of its interactive fantasy sports contests,
14        promptly refund any deposit received from the minor,
15        whether or not the minor has engaged in or attempted to
16        engage in an interactive fantasy sports contest;
17        however, any refund may be offset by any prizes already
18        awarded;
19            (B) publishing and facilitating parental control
20        procedures to allow parents or guardians to exclude
21        minors from access to any interactive fantasy sports
22        contest or interactive fantasy sports platform; and
23            (C) taking appropriate steps to confirm that an
24        individual opening an account is not a minor;
25        (3) when referencing the likelihood of winning in
26    advertisements or upon interactive fantasy sports contest

 

 

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1    entry, make clear and conspicuous statements that are not
2    inaccurate or misleading concerning the likelihood of
3    winning and the number of winners;
4        (4) enable authorized players to restrict themselves
5    from interactive fantasy sports contests and take
6    reasonable steps to prevent these players from entering an
7    interactive fantasy sports contest from which they have
8    excluded themselves; these restrictions shall include, but
9    not be limited to: (A) interactive fantasy sports contest
10    entry limits, (B) limiting play to interactive fantasy
11    sports contest with entry fees below an established limit,
12    and (C) self-imposed deposit limits less than allowed under
13    this Act; interactive fantasy sports operators shall
14    implement and prominently publish procedures for fantasy
15    sports players to implement the restrictions; fantasy
16    sports players shall have the option to adjust these limits
17    to make them more restrictive of gameplay as often as they
18    like, but shall not have the option to make limits less
19    restrictive of gameplay within 90 days after setting the
20    limits;
21        (5) offer introductory procedures for authorized
22    players, that shall be prominently displayed on the
23    interactive fantasy sports operator's interactive fantasy
24    sports platform, that explain interactive fantasy sports
25    contest play and how to identify a highly experienced
26    player;

 

 

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1        (6) identify all highly experienced players in an
2    interactive fantasy sports contest by a symbol attached to
3    the players' user names, or by other easily visible means,
4    on all interactive fantasy sports platforms supported by an
5    interactive fantasy sports operator;
6        (7) disclose the number of entries a single authorized
7    player may submit to each interactive fantasy sports
8    contest;
9        (8) disclose the maximum number of total entries
10    allowed for each interactive fantasy sports contest;
11        (9) implement measures to comply with all applicable
12    State and federal requirements for data security,
13    including, but not limited to, age verification and
14    location software;
15        (10) offer all authorized players access to his or her
16    account history and account details;
17        (11) ensure funds in fantasy sports players' accounts
18    are held in segregated accounts by the interactive fantasy
19    sports operators for the fantasy sports players that
20    establish the accounts; interactive fantasy sports
21    operators shall implement and prominently publish
22    procedures that:
23            (A) prevent unauthorized withdrawals from fantasy
24        sports player accounts by interactive fantasy sports
25        operators or others;
26            (B) prevent commingling of funds in a fantasy

 

 

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1        sports player's account with other funds, including,
2        without limitation, funds of the interactive fantasy
3        sports operator; fantasy sports player funds shall be
4        segregated from interactive fantasy sports operators'
5        operational funds and any other funds held by the
6        interactive fantasy sports operator; and
7            (C) address reporting on complaints by fantasy
8        sports players that their accounts have been
9        misallocated, compromised, or otherwise mishandled;
10        (12) provide on the interactive fantasy sports
11    platform, in a prominent place, information concerning
12    assistance for compulsive play;
13        (13) prohibit the extension of credit from an
14    interactive fantasy sports operator to an authorized
15    player;
16        (14) develop policies to prevent the use of proxy
17    servers for the purpose of misrepresenting a player's
18    location in order to engage in interactive fantasy sports
19    contests; and
20        (15) prevent one fantasy sports player from acting as a
21    proxy for another.
22    (b) No interactive fantasy sports operator employee,
23principal, officer, director, or contractor shall play any
24interactive fantasy sports contest offered to the general
25public or play in such contest through another person as a
26proxy. For the purposes of this subsection (b), a contractor is

 

 

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1limited to a contractor who can access information of an
2interactive fantasy sports operator related to the conduct of
3an interactive fantasy sports contest that is not available to
4other fantasy sports players. Interactive fantasy sports
5operators shall make these restrictions known to all affected
6individuals and corporate entities.
7    (c) No interactive fantasy sports operator employee,
8principal, officer, director, or contractor shall disclose
9confidential information that may affect interactive fantasy
10sports contest gameplay to any person permitted to engage in
11interactive fantasy sports contest gameplay. Interactive
12fantasy sports operators shall make these restrictions known to
13all affected individuals and corporate entities.
14    (d) No interactive fantasy sports operator shall allow a
15professional athlete whose individual statistics or
16performance may be used to determine any part of the outcome of
17any interactive fantasy sports contest to enter interactive
18fantasy sports contests in the sports in which he or she
19participates. An interactive fantasy sports operator shall
20take commercially reasonable efforts to prevent a sports agent,
21team employee, referee, or league official associated with any
22competition that is the subject of interactive fantasy sports
23contests to enter interactive fantasy sports contests in the
24sport in which he or she participates, nor shall such athlete,
25sports agent, team official, team representative, referee, or
26league official play through another person as a proxy.

 

 

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1        (1) Interactive fantasy sports operators shall take
2    commercially reasonable efforts to obtain lists of persons
3    described in this subsection (d) for the purpose of
4    implementing this subsection (d).
5        (2) Interactive fantasy sports operators, upon
6    learning of a violation of this subsection (d), shall bar
7    the individual committing the violation from playing in any
8    interactive fantasy sports contest by suspending the
9    individual's account and banning the individual from
10    further play, shall terminate any existing promotional
11    agreements with the individual, and shall refuse to make
12    any new promotional agreements that compensate the
13    individual.
14        (3) Interactive fantasy sports operators shall make
15    these restrictions known to all affected individuals and
16    corporate entities.
17    (e) Each interactive fantasy sports operator shall:
18        (1) ensure the value of any prizes and awards offered
19    to authorized players are established and made known to the
20    players in advance of the interactive fantasy sports
21    contest;
22        (2) ensure all winning outcomes reflect the relative
23    knowledge and skill of the authorized players and are
24    determined predominantly by accumulated statistical
25    results of the performance of individuals in permitted
26    sports events;

 

 

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1        (3) ensure no winning outcome is based on the score,
2    point spread, or performance of a single sports team, or a
3    combination of sports teams;
4        (4) ensure no winning outcome is based solely on a
5    single performance of an individual athlete in a single
6    sport or athletic event; and
7        (5) ensure no interactive fantasy sports contest is
8    based on a prohibited sports event.
9    (f) Interactive fantasy sports operators shall implement
10and prominently publish procedures that allow any fantasy
11sports player to permanently close an account at any time and
12for any reason. The procedures shall allow for cancellation by
13any means, including, without limitation, by a fantasy sports
14player on any interactive fantasy sports contest used by that
15fantasy sports player to make deposits into a fantasy sports
16player account. A copy of an interactive fantasy sports
17operator's procedures shall be submitted to the Board and any
18changes shall be submitted within 30 days.
19    (g) When a fantasy sports player account is closed, the
20interactive fantasy sports operator shall refund all funds in
21the account no later than 5 business days after submission of
22the request or 10 business days after submission of any tax
23reporting information required by law, whichever is later,
24unless the interactive fantasy sports operator makes a good
25faith determination that the fantasy sports player engaged in
26fraudulent or other conduct that would constitute a violation

 

 

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1of this Act, rules adopted pursuant to this Act, or the
2interactive fantasy sports operator's policies, in which case,
3upon notice to the fantasy sports player of that determination,
4the withdrawal may be held pending a reasonable investigative
5period to resolve its investigation. For the purposes of this
6subsection (g), a request for withdrawal shall be considered
7honored if it is processed by the interactive fantasy sports
8operator, but delayed by a payment processor, a credit card
9issuer, or the custodian of the financial account.
10    (h) If a prize is awarded to a fantasy sports player with a
11closed account, that prize, to the extent it consists of funds,
12shall be distributed by the interactive fantasy sports operator
13within 5 business days, or 10 business days of submission of
14any tax reporting information required by law, unless the
15interactive fantasy sports operator makes a good faith
16determination that the fantasy sports player engaged in
17fraudulent or other conduct that would constitute a violation
18of this Act or rules adopted pursuant to this Act. If such
19determination is made, then the prize may be withheld, provided
20that it is then awarded to another fantasy sports player in the
21same interactive fantasy sports contest who would have won the
22prize had the fantasy sports player with the closed account not
23participated.
24    (i) An interactive fantasy sports operator shall
25prominently publish all contractual terms and conditions and
26rules of general applicability that affect a fantasy sports

 

 

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1player's account. Presentation of such terms, conditions, and
2rules at the time of on boarding a new fantasy sports player
3shall not suffice.
4    (j) Interactive fantasy sports operators shall have
5prominently published rules that govern when each interactive
6fantasy sports contest shall close or lock. Each interactive
7fantasy sports contest operator shall also prominently
8disclose contest-specific information about the time that the
9interactive fantasy sports contest closes or locks in
10connection with each interactive fantasy sports contest
11offered. An interactive fantasy sports operator shall strictly
12enforce all disclosed closing or lock times.
13    (k) Fantasy sports player's deposits shall be limited to no
14more than $1,000 per month. However, an interactive fantasy
15sports operator may establish and prominently publish
16procedures for temporarily or permanently increasing a fantasy
17sports player's deposit limit, at the request of the fantasy
18sports player, above $1,000 per month. Such procedures shall be
19submitted to the Board.
20    If established by an interactive fantasy sports operator,
21such procedures shall include evaluation of information,
22including income or asset information, sufficient to establish
23that the fantasy sports player can afford losses that might
24result from gameplay at the deposit limit level requested.
25    When a temporary or permanent deposit level limit increase
26is approved, the interactive fantasy sports operator's

 

 

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1procedures shall provide for annual re-certification of a
2player's financial ability to afford losses.
3    (l) The following entry limits apply:
4        (1) interactive fantasy sports operators shall not
5    allow players to submit more than one entry in an
6    interactive fantasy sports contest involving 12 entries or
7    fewer;
8        (2) interactive fantasy sports operators shall not
9    allow players to submit more than 2 entries in an
10    interactive fantasy sports contest involving more than 13
11    entries but fewer than 36 entries;
12        (3) interactive fantasy sports operators shall not
13    allow players to submit more than 3 entries in an
14    interactive fantasy sports contest involving 36 or more
15    entries but fewer than 101 entries; and
16        (4) interactive fantasy sports operators shall not
17    allow fantasy sports players to submit more than 3% of all
18    entries in an interactive fantasy sports contest involving
19    101 or more entries.
20        An interactive fantasy sports operator may establish
21    interactive fantasy sports contests, representing less
22    than 2% of the total number of interactive fantasy sports
23    contests that the interactive fantasy sports operator
24    offers, in which there is no restriction on the number of
25    entries, provided that (i) the interactive fantasy sports
26    operator clearly discloses that there are no limits on the

 

 

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1    number of entries by each player in the interactive fantasy
2    sports contest and (ii) that the cost of participating in
3    the interactive fantasy sports contest is $50 or more per
4    entry.
5    (m) Interactive fantasy sports operators shall not offer an
6interactive fantasy sports contest based on a prohibited sports
7event.
8    (n) An interactive fantasy sports operator shall not
9participate in an interactive fantasy sports contest offered by
10the interactive fantasy sports operator.
11    (o) An interactive fantasy sports operator shall not permit
12unauthorized scripts to be used on interactive fantasy sports
13platforms and shall use commercially reasonable efforts to
14monitor for and to prevent use of such scripts.
15    (p) Interactive fantasy sports operators shall develop and
16prominently display procedures on the interactive fantasy
17sports operator's interactive fantasy sports platform for the
18filing of a complaint by the authorized player against the
19interactive fantasy sports operator. The interactive fantasy
20sports operator shall give an initial response to the player
21within 48 hours after the player files the complaint. The
22interactive fantasy sports operator shall give a complete
23response to the player filing the complaint within 10 business
24days after the initial response is issued. An authorized player
25may file a complaint alleging a violation of the provisions of
26this Act with the Board.

 

 

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1    (q) An interactive fantasy sports operator shall close any
2fantasy player account that is inactive for 2 years and notify
3the account holder that the account has been closed by email to
4the account holder's last known email address. When a fantasy
5sports player account is closed due to inactivity, the
6interactive fantasy sports operator shall take commercially
7reasonable steps to refund all funds in the fantasy sports
8player account within 30 days, subject to the receipt of any
9tax information required by law. In the event that funds in a
10closed fantasy sports player account exceed $5 and cannot be
11refunded and remain unclaimed, the interactive fantasy sports
12operator shall provide notice of the existence of funds to the
13fantasy sports player. Such notice shall be provided by email
14to the account holder's last known email address. In the event
15that funds in a closed fantasy sports player account cannot be
16refunded and remain unclaimed by the fantasy sports player
17after 3 years, such funds shall be paid by the interactive
18fantasy sports operator to the Unclaimed Property Trust Fund in
19the Office of the State Treasurer. The interactive fantasy
20sports operator shall provide notice to the fantasy sports
21player's email address at least 60 days prior to paying the
22funds to the Unclaimed Property Trust Fund.
23    (r) Interactive fantasy sports operators shall develop
24games that are limited to beginner fantasy sports players and
25shall prohibit individuals who are not beginner fantasy sports
26players from participating in those games either directly or

 

 

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1through another person as a proxy. An interactive fantasy
2sports operator shall suspend the account of an individual who
3is not a beginner fantasy sports player and who enters a game
4limited to beginner fantasy sports players and shall ban the
5player from future play.
6    (s) All interactive fantasy sports operators shall develop
7games in which highly experienced fantasy sports players cannot
8participate either directly or through another person as a
9proxy. An interactive fantasy sports operator shall suspend the
10account of a highly experienced fantasy sports player who
11enters a game that excludes highly experienced fantasy sports
12players directly or through another person as a proxy and shall
13ban the individual from future play.
 
14    Section 1-30. Multiple interactive fantasy sports
15platforms; interactive fantasy sports contests. A licensee may
16use multiple interactive fantasy sports platforms and offer
17multiple types of interactive fantasy sports contests.
 
18    Section 1-35. Advertising.
19    (a) Advertisements of interactive fantasy sports operators
20shall not feature: (1) minors (other than professional athletes
21who may be minors), (2) students, (3) schools, colleges, or
22universities, or (4) school, college, or university settings.
23However, incidental depiction of non-featured minors or minors
24accompanying adults shall not be a violation of this subsection

 

 

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1(a).
2    (b) Interactive fantasy sports operators shall not
3advertise on school, college, or university campuses.
4    (c) Interactive fantasy sports operators shall not
5advertise at amateur athletic competitions, except to the
6extent that those competitions are played in stadiums where
7professional competitions are held and where non-digital
8advertisements have been posted, erected, or otherwise
9displayed in a manner that would require substantial effort to
10remove.
 
11    Section 1-40. Powers and duties of the Board.
12    (a) The Board has jurisdiction over and shall supervise all
13interactive fantasy sports contests governed by this Act. The
14Board has all powers and duties necessary and proper to fully
15and exclusively execute the provisions of the Act, including,
16but not limited to, the following:
17        (1) To investigate applicants and determine the
18    eligibility of applicants that best serve the interests of
19    the citizens of Illinois.
20        (2) To provide for the establishment and collection of
21    all fees, fines, and taxes imposed by this Act and the
22    rules adopted under this Act.
23        (3) To suspend, revoke, or restrict licenses; to
24    require the removal of an interactive fantasy sports
25    operator or an employee of an interactive fantasy sports

 

 

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1    operator for a violation of this Act; and to impose civil
2    penalties of an amount up to $5,000 against individuals and
3    $10,000 against licensees for each violation of the
4    provisions of this Act.
5        (4) To approve and deny applications for licensure to
6    conduct interactive fantasy sports contests in this State,
7    and to suspend, refuse or renew, or revoke a license issued
8    under this Act.
9        (5) To accept and investigate complaints of any kind
10    from an authorized player and attempt to mediate the
11    complaints where appropriate.
12        (6) To investigate alleged violations of this Act.
13        (7) To initiate proper enforcement proceedings where
14    such action is deemed by the Board to be necessary or
15    appropriate.
16        (8) To exercise all powers and duties assigned by this
17    Act.
18    (b) The Board shall adopt rules to implement the provisions
19of and effectuate the policy and objectives of this Act as the
20Board may deem necessary or advisable, including, but not
21limited to, the development of the initial form of the
22application for licensure. These rules shall include, but not
23be limited to, responsible protections with regard to
24compulsive play and safeguards for fair play. The Board shall
25not adopt rules limiting or regulating:
26        (1) the rules or the administration of an individual

 

 

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1    interactive fantasy sports contest;
2        (2) the statistical makeup of an interactive fantasy
3    sports contest; or
4        (3) the digital interactive fantasy sports platform of
5    an interactive fantasy sports operator.
6    (c) The Board shall adopt emergency rules to administer
7this Act in accordance with Section 5-45 of the Illinois
8Administrative Procedure Act. For the purposes of the Illinois
9Administrative Procedure Act, the General Assembly finds that
10the adoption of rules to implement this Act is deemed an
11emergency and necessary for the public interest, safety, and
12welfare.
 
13    Section 1-45. Annual report.
14    (a) Each licensee shall annually submit a report to the
15Board by no later than June 30 of each year that shall include
16the following information as it applies to accounts held by
17authorized players located in this State:
18        (1) the number of accounts held by authorized players
19    on all interactive fantasy sports platforms offered by the
20    interactive fantasy sports operator and the number of
21    accounts held by highly experienced players on all
22    interactive fantasy sports platforms offered by the
23    interactive fantasy sports operator;
24        (2) the total number of new accounts established in the
25    preceding year as well as the total number of accounts

 

 

10000SB0208sam001- 25 -LRB100 04954 AMC 27129 a

1    permanently closed in the preceding year;
2        (3) the total amount of entry fees received from
3    authorized players;
4        (4) the total amount of prizes awarded to authorized
5    players;
6        (5) the total amount of interactive fantasy sports
7    gross revenue received by the licensee; and
8        (6) the total number of authorized players that
9    requested to exclude themselves from interactive fantasy
10    sports contests.
11    (b) The Board shall annually publish a report based on the
12aggregate information provided by all interactive fantasy
13sports operators in accordance with this Section, that shall be
14published on the Board's website no later than 180 days after
15the deadline for the submission of individual reports as
16specified in this Section.
 
17    Section 1-50. State tax.
18    (a) A privilege tax is imposed on persons engaged in the
19business of operating an interactive fantasy sports contest in
20this State. For the privilege of conducting interactive fantasy
21sports contests in the State, interactive fantasy sports
22operators shall pay a tax at the following graduated rates:
23        (1) 5% of annual interactive fantasy sports gross
24    revenue up to and including $1,000,000;
25        (2) 7.5% of annual interactive fantasy sports gross

 

 

10000SB0208sam001- 26 -LRB100 04954 AMC 27129 a

1    revenue in excess of $1,000,000 but not exceeding
2    $3,000,000;
3        (3) 10% of annual interactive fantasy sports gross
4    revenue in excess of $3,000,000 but not exceeding
5    $8,000,000;
6        (4) 15% of annual interactive fantasy sports gross
7    revenue in excess of $8,000,000.
8    (b) The tax imposed by this Section shall be paid by the
9interactive fantasy sports operator to the Board not later than
10the 15th day of every month for the previous month's privilege
11taxes.
 
12    Section 1-55. Disposition of taxes. The Board shall pay
13into the Education Assistance Fund all taxes imposed by this
14Act, any interest and penalties imposed by the Board relating
15to those taxes, all penalties levied and collected by the
16Board, and the appropriate funds, cash, or prizes forfeited
17from interactive fantasy sports contests.
 
18    Section 1-60. Audits. All interactive fantasy sports
19operators with annual interactive fantasy sports contest gross
20revenue of $100,000 or more shall annually be subject to an
21audit of the financial transactions and condition of the
22interactive fantasy sports operator's total operations as they
23relate to the offering and operating of interactive fantasy
24sports contests and to ensure compliance with all of the

 

 

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1requirements in this Act. Interactive fantasy sports operators
2with annual interactive fantasy sports contest gross revenues
3less than $100,000 shall every 3 years be subject to an audit
4of the financial transactions and condition of the interactive
5fantasy sports operator's total operations as they relate to
6the offering and operating of interactive fantasy sports
7contests and to ensure compliance with all of the requirements
8in this Act. All audits and compliance engagements shall be
9conducted by certified public accountants or an independent
10testing laboratory approved by the Board. The compensation for
11each certified public accountant or independent testing
12laboratory shall be paid directly by the interactive fantasy
13sports operator to the certified public accountant or
14independent testing laboratory. The audit shall be conducted
15and submitted to the Board by June 30 of each year.
 
16    Section 1-65. Limitation on the taxation of interactive
17fantasy sports operators. Interactive fantasy sports operators
18shall not be subjected to an excise tax, license tax, permit
19tax, privilege tax, amusement tax, or occupation tax that is
20imposed upon the licensee by the State or any political
21subdivision thereof, except as provided in this Act.
 
22    Section 1-70. Application fees; license fees.
23    (a) A non-refundable application fee shall be paid at the
24time an application for licensure is filed with the Board in

 

 

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1the following amounts:
2        (1) Interactive fantasy sports operators with annual
3    interactive fantasy sports gross revenue greater than
4    $10,000,000 ......................................... $25,000
5        (2) Interactive fantasy sports operators with annual
6    interactive fantasy sports gross revenue greater than
7    $5,000,000 but not more than $10,000,000 ............ $12,500
8        (3) Interactive fantasy sports operators with annual
9    interactive fantasy sports gross revenue greater than
10    $1,000,000 but not more than $5,000,000 .............. $7,500
11        (4) Interactive fantasy sports operators with annual
12    interactive fantasy sports gross revenue of at least
13    $100,000 but not more than $1,000,000 ................ $5,000
14        (5) Interactive fantasy sports operators with annual
15    interactive fantasy sports gross revenue less than
16    $100,000 ............................................... $500
17    (b) The Board shall establish a fee for each license not to
18exceed the following for the initial licensure period:
19        (1) Interactive fantasy sports operators with annual
20    interactive fantasy sports gross revenue greater than
21    $10,000,000 ......................................... $50,000
22        (2) Interactive fantasy sports operators with annual
23    interactive fantasy sports gross revenue greater than
24    $5,000,000 but not more than $10,000,000 ............ $25,000
25        (3) Interactive fantasy sports operators with annual
26    interactive fantasy sports gross revenue greater than

 

 

10000SB0208sam001- 29 -LRB100 04954 AMC 27129 a

1    $1,000,000 but not more than $5,000,000 ..............$15,000
2        (4) Interactive fantasy sports operators with annual
3    interactive fantasy sports gross revenue of at least
4    $100,000 but not more than $1,000,000 ............... $10,000
5        (5) Interactive fantasy sports operators with annual
6    interactive fantasy sports gross revenue less than
7    $100,000 ............................................. $1,500
8    (c) For subsequent licensure periods, the renewal fee shall
9not exceed the following:
10        (1) Interactive fantasy sports operators with annual
11    interactive fantasy sports gross revenue greater than
12    $10,000,000 ......................................... $37,500
13        (2) Interactive fantasy sports operators with annual
14    interactive fantasy sports gross revenue greater than
15    $5,000,000 but not more than $10,000,000 ............ $18,750
16        (3) Interactive fantasy sports operators with annual
17    interactive fantasy sports gross revenue greater than
18    $1,000,000 but not more than $5,000,000 ............. $11,250
19        (4) Interactive fantasy sports operators with annual
20    interactive fantasy sports gross revenue of at least
21    $100,000 but not more than $1,000,000 .................$7,500
22        (5) Interactive fantasy sports operators with annual
23    interactive fantasy sports gross revenue less than
24    $100,000 ............................................. $1,125
25    (d) All fees collected under this Section shall be
26deposited into the State Gaming Fund.

 

 

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1    (e) All fees collected under this Section shall be used for
2the administration of this Act.
 
3    Section 1-75. Interactive fantasy sports contests
4authorized. Interactive fantasy sports contests conducted in
5accordance with the provisions of this Act are hereby
6authorized.
 
7    Section 1-80. Interactive fantasy sports contests
8prohibited. The conduct of interactive fantasy sports contests
9by unlicensed operators is prohibited.
 
10    Section 1-85. Interactive fantasy sports contests;
11Criminal Code of 2012. Interactive fantasy sports contests
12offered in accordance with the provisions of this Act shall not
13constitute gambling as defined in Section 28-1 of the Criminal
14Code of 2012.
 
15    Section 1-900. Repeal. This Act is repealed on January 1,
162021.
 
17
Article 5. Internet Gaming Act

 
18    Section 5-1. Short title. This Article may be cited as the
19Internet Gaming Act. References in this Article to "this Act"
20mean this Article.
 

 

 

10000SB0208sam001- 31 -LRB100 04954 AMC 27129 a

1    Section 5-5. Legislative findings and intent. The General
2Assembly finds that the Internet has become an integral part of
3everyday life for a significant number of Illinois residents,
4not only in regard to their professional life, but also in
5regard to personal business and communication. Internet
6wagering on games of chance and games of skill is a core form
7of entertainment for millions of individuals worldwide. In
8multiple jurisdictions across the world, Internet gaming is
9legal, regulated, and taxed, generating millions of dollars in
10revenue for governments.
11    The General Assembly further finds that Illinois residents
12participate in illegal online gambling on unregulated Internet
13websites operated by offshore operators who are not subject to
14regulation or taxation in the United States. Neither federal
15nor Illinois laws provide sufficient consumer protections for
16Illinois residents who play games of chance or skill on these
17illegal websites, nor does the State realize any benefits from
18the revenues generated nor jobs created by illegal online
19gaming.
20    In an opinion dated September 20, 2011, the United States
21Department of Justice reversed its previous interpretation of
22the federal Wire Act, 18 U.S.C. 1084, allowing states, subject
23to certain restrictions, to legalize and regulate Internet
24gaming and capture the revenue for the benefit of state
25governments. The Department of Justice's opinion was prompted

 

 

10000SB0208sam001- 32 -LRB100 04954 AMC 27129 a

1in part by a request made by the Department of Revenue pursuant
2to Public Act 96-34. In order to protect Illinois residents who
3wager on games of chance and skill through the Internet and to
4capture revenues and create jobs generated from Internet
5gaming, it is in the best interest of the State and its
6citizens to regulate this activity by authorizing and
7establishing a secure, responsible, fair, and legal system of
8Internet gaming that complies with the United States Department
9of Justice's September 2011 opinion concerning the federal Wire
10Act.
11    The General Assembly additionally finds that pursuant to
12the federal Unlawful Internet Gambling Enforcement Act of 2006
13(UIGEA), 31 U.S.C. 5361, the provisions of this Act are
14consistent and comply with the UIGEA and specifically authorize
15use of the Internet to place, receive, or otherwise knowingly
16transmit a bet or wager where Internet wagering complies with
17this Act and rules adopted pursuant to this Act.
 
18    Section 5-10. Definitions. As used in this Act:
19    "Authorized participant" means a person who has a valid
20Internet wagering account with an Internet gaming licensee and
21is at least 21 years of age.
22    "Board" means the Illinois Gaming Board.
23    "Division" means the Division of Internet Gaming within the
24Illinois Gaming Board.
25    "Fee-based game" means a game determined by the Division to

 

 

10000SB0208sam001- 33 -LRB100 04954 AMC 27129 a

1be a fee-based game, where the Internet gaming licensee charges
2a fee, rake, or commission for operating the game.
3    "Gross fee-based gaming revenue" means the fee, rake, or
4commission charged by the Internet gaming licensee for
5operation of fee-based games.
6    "Gross gaming revenue" is the aggregate of gross fee-based
7gaming revenue and gross non-fee-based gaming revenue.
8    "Gross non-fee-based gaming revenue" means the aggregate
9of the amount of net wins received on all non-fee-based games.
10    "Internet" means the international computer network of
11interoperable packet-switched data networks, inclusive of such
12additional technological platforms as mobile, satellite, and
13other electronic distribution channels approved by the Board.
14    "Internet game" means a fee-based or non-fee-based game of
15skill or chance that is offered by an Internet gaming licensee,
16as authorized by the Board. "Internet game" includes gaming
17tournaments conducted via the Internet in which players compete
18against one another in one or more of the games authorized in
19this definition or by the Division or in approved variations or
20composites as authorized by the Division. "Internet game" does
21not include an interactive fantasy sports contest under the
22Fantasy Sports Contest Act.
23    "Internet gaming licensee" means a person, corporation,
24partnership, or other entity receiving an Internet gaming
25license from the Board to conduct Internet wagering.
26    "Internet gaming platform" means the combination of

 

 

10000SB0208sam001- 34 -LRB100 04954 AMC 27129 a

1hardware and software or other technology designed and used to
2manage, conduct, and record Internet gaming and the wagers
3associated with internet gaming, as approved by the Board.
4"Internet gaming platform" includes an emerging or new
5technology deployed to advance the conduct and operation of
6Internet gaming, as approved through rulemaking by the Board.
7    "Internet gaming skin" means the brand used by the Internet
8gaming licensee as presented through a portal, Internet
9website, or computer or mobile application or app through which
10authorized Internet gaming is made available to authorized
11participants by an Internet gaming licensee.
12    "Internet gaming vendor" means a person, corporation,
13partnership, or other entity that is certified by the Division
14to provide or offer to provide goods, software, or services to
15an Internet gaming licensee related to or supporting: (i) the
16acceptance, testing, auditing, management, operation, support,
17administration, or control of Internet wagers, Internet games,
18Internet wagering accounts, or Internet gaming platforms or
19(ii) the management, operation, administration, or control of
20payment processing systems. Notwithstanding this definition,
21the licensing of trademarks, names, likenesses, graphics, or
22other images, without more, shall not render a licensor of such
23intellectual property an Internet gaming vendor.
24    "Internet wagering" means the placing of wagers with an
25Internet gaming licensee by persons who are either physically
26present in Illinois when placing a wager or otherwise permitted

 

 

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1to place a wager by law. The intermediate routing of electronic
2data in connection with Internet wagering, including across
3state lines, shall not determine the location or locations in
4which a wager is initiated, received, or otherwise made.
5    "Internet wagering account" means an electronic ledger
6wherein the following types of transactions relative to the
7Internet gaming platform are recorded: (i) deposits; (ii)
8withdrawals; (iii) amounts wagered; (iv) amounts paid on
9winning wagers; (v) service or other transaction-related
10charges authorized by the patron, if any; (vi) adjustments to
11the account; and (vii) any other information required by the
12Division.
13    "Net wins" means the amount of Internet wagers received by
14the Internet gaming licensee on non-fee based games less the
15amount paid by the Internet gaming licensee as winnings on that
16non-fee based game.
17    "Non-fee-based game" means a game determined by the Board
18to be a non-fee-based game, where (i) the player plays against
19the Internet gaming licensee and (ii) the Internet gaming
20licensee is banking the game and its bottom line is affected by
21players' wins and losses.
 
22    Section 5-15. Authorization. Internet wagering, as
23defined in this Act, is hereby authorized to the extent that it
24is carried out in accordance with the provisions of this Act.
 

 

 

10000SB0208sam001- 36 -LRB100 04954 AMC 27129 a

1    Section 5-20. Division of Internet Gaming. The Division of
2Internet Gaming is established within the Illinois Gaming Board
3and shall have all of the powers and duties specified in this
4Act and all other powers necessary and proper to enable it to
5fully and effectively execute the provisions of this Act for
6the purpose of administering, regulating, and enforcing the
7system of Internet gaming established by this Act. The Division
8of Internet Gaming's jurisdiction shall extend under this Act
9to every person, corporation, partnership, or other entity
10involved in Internet gaming operations. To the extent
11consistent with the provisions of this Act, the Division shall
12be subject to and governed by the laws and rules applicable to
13the Board. The Division of Internet Gaming is also authorized
14to enter into agreements with other gaming entities within the
15United States, including any State or United States territory
16or possession, for the purpose of facilitating, administering,
17and regulating Internet gaming to the extent consistent with
18federal laws and the laws of any State or United States
19territory or possession that is a party to the
20multijurisdictional agreement. The Division shall not
21authorize, administer, or otherwise maintain a system for
22offering wagering on any amateur or professional sporting event
23or contest. Notwithstanding any other provision of this Act,
24wagers may be accepted from persons who are in the United
25States but not physically present in this State if the Division
26determines that such wagering is not inconsistent with federal

 

 

10000SB0208sam001- 37 -LRB100 04954 AMC 27129 a

1law and the law of the United States jurisdiction in which any
2such person is located or such wagering is conducted in
3accordance with a multijurisdictional agreement that is not
4inconsistent with federal law to which this State is a party.
5The Division shall be funded with moneys appropriated to the
6Illinois Gaming Board.
 
7    Section 5-25. Application and eligibility for licensure.
8The Division of Internet Gaming is authorized to issue Internet
9gaming licenses to persons, firms, partnerships, or
10corporations that apply for such licensure upon a determination
11by the Division that the applicant is eligible for an Internet
12gaming license under this Act and rules adopted by the
13Division. An Internet gaming license issued under this Act
14shall be valid for a period of 5 years after the date of
15issuance and shall be renewable thereafter for an additional 5
16years based on a determination by the Division that the
17licensee continues to meet all the requirements of this Act and
18the Division's rules. Notwithstanding any other law to the
19contrary, any assignment or transfer of an interest in an
20Internet gaming license, or a greater than 10% interest, direct
21or indirect, in any entity holding such a license, is subject
22to the written approval by the Division. Approved transferees
23are subject to a $250,000 non-refundable application fee.
24Eligibility for application for an Internet gaming license
25shall be limited to any person or entity that holds a valid and

 

 

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1unrevoked: (i) owners license issued pursuant to the Riverboat
2Gambling Act, or any affiliate thereof as defined by the Board
3in its administrative rules implementing such Act, or any
4person or entity who as of January 1, 2017 was designated by
5the Illinois Gaming Board as a key person of an owners licensee
6or is controlled by one or more key persons of an owners
7licensee; (ii) organization license issued pursuant to the
8Illinois Horse Racing Act of 1975, but only if the organization
9licensee conducted live racing in calendar year 2016; (iii)
10advance deposit wagering license issued pursuant to the
11Illinois Horse Racing Act of 1975, but only if the advance
12deposit wagering licensee conducted advance deposit wagering
13in Illinois in calendar year 2016. No Internet gaming license
14shall be granted to any applicant that has accepted, that has
15or had an affiliate that has accepted, or that has officers or
16directors who are or have been officers or directors of another
17party that accepted wagers via the Internet in contravention of
18this Act, Illinois law, or United States law in the 5 years
19preceding the application date.
20    A qualified applicant may apply to the Division for an
21Internet gaming license to offer wagering on Internet games as
22provided in this Act. The application shall be made on forms
23provided by the Division and shall contain such information as
24the Division prescribes, including, but not limited to,
25detailed information regarding the ownership and management of
26the applicant, detailed personal information regarding the

 

 

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1applicant, financial information regarding the applicant, and
2the gaming history and experience of the applicant in the
3United States and other jurisdictions. Each application shall
4be accompanied by a non-refundable application fee of $250,000.
5An incomplete application shall be cause for denial of a
6license by the Division.
7    All information, records, interviews, reports, statements,
8memoranda, or other data supplied to or used by the Division in
9the course of its review or investigation of an application for
10an Internet gaming license or a renewal under this Act is
11subject to Section 5.1 and Section (d) of Section 6 of the
12Riverboat Gambling Act.
13    Any person, association, corporation, partnership, or
14entity who (i) knowingly makes materially false statements in
15order to obtain an Internet gaming license; (ii) knowingly
16advertises within the State of Illinois any game, product, or
17feature that is not authorized by his or her license; or (iii)
18violates any other provision of this Act or any rule adopted
19under this Act is guilty of a Class B misdemeanor for the first
20violation and is guilty of a Class A misdemeanor for a second
21or subsequent violation. In the case of an association,
22corporation, partnership, or entity, imprisonment may be
23imposed upon its officers who knowingly participated in the
24violation.
25    An application shall be filed and considered in accordance
26with the rules of the Division. The Division shall adopt rules

 

 

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1to effectuate the provisions of this Section within 30 days
2after the effective date of this Act.
3    A license fee of $10,000,000 shall be paid to the Division
4by an Internet gaming licensee at the time of issuance of the
5license. All application and license fees shall be deposited
6into the State Gaming Fund. The license fee imposed by this
7Section shall constitute an advance payment of Internet
8wagering taxes owed by the Internet gaming licensee under
9Section 5-55 of this Act.
 
10    Section 5-30. Certification of Internet gaming vendors.
11The Division is authorized to certify Internet gaming vendors
12to provide goods, software, or services to Internet gaming
13licensees. Certification by the Division of an Internet gaming
14vendor shall be for a period of 5 years and shall be renewable
15thereafter for an additional 5 years based on a determination
16by the Division that the Internet gaming vendor continues to
17meet all the requirements of this Act and the Division's rules.
18The Division shall have the sole and exclusive jurisdiction to
19determine what persons, corporations, partnerships, or other
20entities require certification under this Act and the rules
21adopted under this Act.
22    A person, corporation, partnership, or other entity may
23apply to the Division to become an Internet gaming vendor as
24provided in this Act and the rules of the Division. The
25application shall be made on forms provided by the Division and

 

 

10000SB0208sam001- 41 -LRB100 04954 AMC 27129 a

1shall contain such information as the Division prescribes,
2including, but not limited to, detailed information regarding
3the ownership and management of the applicant, detailed
4personal information regarding the applicant, financial
5information regarding the applicant, and the gaming history and
6experience of the applicant in the United States and other
7jurisdictions. Each application shall be accompanied by a
8non-refundable application fee, the amount of which shall be
9determined by the Division, but shall not exceed $250,000. An
10incomplete application shall be cause for denial of
11certification. No certification shall be granted to an Internet
12gaming vendor who has accepted wagers via the Internet in
13contravention of this Act or in contravention of any law of the
14United States.
15    All information, records, interviews, reports, statements,
16memoranda, or other data supplied to or used by the Division in
17the course of its review or investigation of an application for
18certification as an Internet gaming vendor is strictly
19confidential and shall only be used for the purpose of
20evaluating an applicant for a certification. Notwithstanding
21any law to the contrary, such information is subject to Section
225.1 and subsection (d) of Section 6 of the Riverboat Gambling
23Act.
24    Any person, association, corporation, partnership, or
25entity who (i) knowingly makes materially false statements in
26order to obtain certification as an Internet gaming vendor or

 

 

10000SB0208sam001- 42 -LRB100 04954 AMC 27129 a

1(ii) violates any other provision of this Act or any rule
2adopted under this Act is guilty of a Class B misdemeanor for a
3first offense and is guilty of a Class A misdemeanor for a
4second or subsequent offense. In the case of an association,
5corporation, partnership, or entity, imprisonment may be
6imposed upon its officers who knowingly participate in the
7violation.
8    The Board shall adopt rules to ensure that all licensees
9are treated and all licensees act in a non-discriminatory
10manner and develop processes and penalties to enforce those
11rules.
 
12    Section 5-35. Authority of the Division.
13    (a) The Division shall have all the powers necessary or
14desirable to effectuate the provisions of this Act, including,
15but not limited to, the following powers:
16        (1) To develop qualifications, standards, and
17    procedures for approval and licensure of Internet gaming
18    licensees and certification of Internet gaming vendors.
19        (2) To decide promptly and in reasonable order all
20    license applications and to approve, deny, suspend,
21    revoke, restrict, or refuse to renew Internet gaming
22    licenses and Internet gaming vendor certifications. Any
23    party aggrieved by an action of the Division denying,
24    suspending, revoking, restricting, or refusing to renew a
25    license may request a hearing before the Division. A

 

 

10000SB0208sam001- 43 -LRB100 04954 AMC 27129 a

1    request for hearing must be made to the Division in writing
2    within 5 days after service of notice of the action by the
3    Division. Notice of action by the Division shall be served
4    either by personal delivery or by certified mail, postage
5    prepaid, to the aggrieved party. Notice served by certified
6    mail shall be deemed complete on the business day following
7    the date of such mailing. The Division shall conduct all
8    requested hearings promptly and in reasonable order.
9        (3) To conduct all hearings pertaining to civil
10    violations of this Act or rules adopted under this Act.
11    Such hearings shall be governed by Section 5 of the
12    Riverboat Gambling Act. The Division shall further adopt
13    hearing rules and procedures for conducting hearings under
14    this Act. In such hearings, reproduced copies of any of the
15    Division's records relating to an Internet gaming licensee
16    or Internet gaming vendor, including (i) any notices
17    prepared in the Division's ordinary course of business and
18    (ii) any books, records, or other documents offered in the
19    name of the Division under certificate of the Executive
20    Director, or any officer or employee of the Division
21    designated in writing by the Executive Director, shall,
22    without further proof, be admitted into evidence in any
23    hearing before the hearing officers or any legal proceeding
24    and shall be prima facie proof of the information contained
25    therein. The Office of the Attorney General shall prosecute
26    all criminal violations of this Act or rules adopted under

 

 

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1    this Act.
2        (4) To provide for the establishment and collection of
3    all license and certification fees and taxes imposed by
4    this Act and the rules adopted under this Act. All such
5    fees and taxes shall be deposited into the State Gaming
6    Fund.
7        (5) To develop and enforce testing, audit, and
8    certification requirements and schedules for Internet
9    gaming platforms, Internet gaming skins, Internet
10    wagering, and Internet wagering accounts, including,
11    without limitation, age and identification verification
12    software, geolocation software, Internet games, and gaming
13    hub software.
14        (6) To develop and enforce requirements for
15    responsible gaming and player protection, including
16    privacy and confidentiality standards and duties.
17        (7) To develop and enforce requirements for accepting
18    Internet wagers, Internet wagering accounts, and
19    authorized participants and minimum insurance
20    requirements.
21        (8) To develop and promote standards governing
22    contracts between Internet gaming licensees and the
23    payments industry.
24        (9) To develop and enforce standards and requirements
25    regarding anti-fraud, anti-money laundering, and
26    anti-collusion methods.

 

 

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1        (10) To develop protocols related to the security of
2    and disputes arising over Internet wagers and Internet
3    wagering accounts.
4        (11) To be present through its inspectors and agents
5    upon the premises of any location where Internet gaming
6    operations are conducted by an Internet gaming licensee or
7    where components of an Internet gaming licensee's Internet
8    gaming platform are located, housed, or otherwise
9    maintained.
10        (12) To adopt by rule a code of conduct governing
11    Division employees that ensures, to the maximum extent
12    possible, that persons subject to this Act avoid
13    situations, relationships, or associations that may
14    represent or lead to an actual or perceived conflict of
15    interest.
16        (13) To develop and administer civil penalties for
17    Internet gaming licensees and Internet gaming vendors who
18    violate this Act or the rules adopted under this Act.
19        (14) To audit and inspect, on reasonable notice, books
20    and records relevant to Internet gaming operations,
21    Internet wagers, Internet wagering accounts, Internet
22    gaming skins, Internet games, or Internet gaming
23    platforms, including, without limitation, those books and
24    records regarding financing or accounting, marketing or
25    operational materials, or any other such materials held by
26    or in the custody of any Internet gaming licensee or

 

 

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1    Internet gaming vendor. The Division may assert such
2    authority by administrative subpoena, which may further
3    set forth relevant document requests and interrogatories
4    and which shall be enforceable in the Circuit Court of Cook
5    County in the State of Illinois.
6        (15) To determine whether an Internet game is a
7    fee-based game or non-fee-based game.
8        (16) To acquire or lease real property and make
9    improvements thereon and acquire by lease or by purchase
10    personal property, including, but not limited to:
11            (A) computer hardware;
12            (B) mechanical, electronic, and online equipment
13        and terminals; and
14            (C) intangible property, including, but not
15        limited to, computer programs, software, and systems.
16        (17) To adopt rules for the purpose of administering
17    the provisions of this Act and to prescribe rules and
18    conditions under which all Internet gaming in the State
19    shall be conducted. Such rules are to provide for the
20    prevention of practices detrimental to the public interest
21    and for the best interests of Internet gaming, including
22    rules (i) regarding the inspection of licensees and the
23    review of any permits or licenses necessary to operate
24    under any applicable laws or rules, (ii) to impose
25    penalties for violations of this Act and its rules, and
26    (iii) establishing standards for advertising of Internet

 

 

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1    gaming.
2    (b) The Division shall adopt and enforce such rules
3governing the administration and conduct of Internet gaming as
4it deems necessary to carry out the purpose of this Act. These
5rules shall be subject to the provisions of the Illinois
6Administrative Procedure Act and may include, but shall not be
7limited to:
8        (1) the types of Internet games to be offered;
9        (2) price points for Internet games;
10        (3) player fees and percentage of rake commission or
11    other fee for Internet games;
12        (4) forms of payment accepted for Internet games;
13        (5) the number, type, and amount of prizes for Internet
14    games;
15        (6) the method of selecting winners and validating
16    winnings;
17        (7) the frequency of Internet games;
18        (8) responsible gaming;
19        (9) technical and financial standards for Internet
20    wagering, Internet wagering accounts, and Internet gaming
21    platforms, systems, and software or other electronic
22    components for Internet gaming; and
23        (10) such other matters necessary or desirable for the
24    efficient and economical operation and administration of
25    Internet gaming and for the convenience of authorized
26    Internet gaming participants and Internet gaming licensees

 

 

10000SB0208sam001- 48 -LRB100 04954 AMC 27129 a

1    and certified Internet gaming vendors.
2    (c) Notwithstanding any law to the contrary, the Board
3shall hire an Executive Director of the Division for a 5-year
4term who shall be responsible to the Board and shall serve
5subject only to removal by the Board for incompetence, neglect
6of duty, or malfeasance in office. The Executive Director shall
7be responsible for the supervision and direction of the
8Division staff and for the necessary administrative activities
9of the Division, subject only to the direction and approval of
10the Board notwithstanding any law to the contrary.
11    Notwithstanding any law to the contrary, the Executive
12Director shall hire and employ employees as may be necessary to
13carry out the provisions of this Act or to perform the duties
14and exercise the powers conferred by law upon the Division. All
15employees of the Division shall receive the compensation fixed
16by the Executive Director, and approved by the Board. The
17Board, Executive Director, and Division employees shall be
18reimbursed for all actual and necessary traveling and other
19expenses and disbursements necessarily incurred or made by them
20in the discharge of their official duties. The Board and
21Executive Director may also incur necessary expenses for office
22space, furniture, stationery, printing, operations, and other
23incidental expenses.
24    The Executive Director shall report monthly to the Gaming
25Board a full and complete statement of Internet gaming
26revenues, other expenses for each month, and the amounts to be

 

 

10000SB0208sam001- 49 -LRB100 04954 AMC 27129 a

1transferred to the State Gaming Fund in accordance with this
2Act. The Executive Director shall also make an annual report,
3which shall include a full and complete statement of Internet
4gaming revenues and other expenses, that shall be publicly
5disclosed on the Board's Internet website. All reports required
6by this subsection shall be public, and copies of all such
7reports shall be sent to the Speaker of the House of
8Representatives, the President of the Senate, the Minority
9Leader of the House of Representatives, and the Minority Leader
10of the Senate.
11    The Executive Director shall apprise himself or herself of:
12(i) the operation and the administration of similar Internet
13gaming laws that may be in effect in other states or countries;
14(ii) any relevant literature on Internet gaming that from time
15to time may be published or available; (iii) any federal laws
16and regulations that may affect the operation of Internet
17gaming; and (iv) the reaction of Illinois citizens to existing
18and potential features of Internet gaming with a view to
19recommending or effecting changes that will tend to serve the
20purposes of this Act.
 
21    Section 5-40. Internet gaming skins. Each internet gaming
22licensee shall be limited to not more than 2 Internet gaming
23skins, each of which must reflect a brand owned by the licensee
24or any affiliate of the licensee in the United States.
25    As used in this Section, "affiliate" means a person that

 

 

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1directly, or indirectly through one or more intermediaries,
2controls, is controlled by, or is under common control with a
3licensee.
 
4    Section 5-45. Place of public accommodation.
5    (a) No organization or commercial enterprise shall operate
6a place of public accommodation, club, including a club or
7association limited to dues-paying members or similar
8restricted groups, or similar establishment in which computer
9terminals or similar access devices are advertised or made
10available to be used principally for the purpose of accessing
11Internet games. No holder of (i) an owners license issued under
12the Riverboat Gambling Act or (ii) an organization license or
13advance deposit wagering license under the Illinois Horse
14Racing Act of 1975 shall offer or make available computer
15terminals or similar access devices to be used principally for
16the purpose of accessing Internet games within the premises of
17such license holder.
18    (b) Nothing in this Section shall be construed:
19        (1) to require the owner or operator of a hotel or
20    motel or other public place of general use in this State to
21    prohibit or block guests from playing Internet games; or
22        (2) to require an Internet gaming license holder to
23    prohibit authorized participants within the premises of
24    the license holder from playing Internet games.
 

 

 

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1    Section 5-50. Age verification and responsible gaming.
2    (a) An Internet gaming licensee's Internet gaming platform
3shall provide one or more mechanisms to reasonably verify that
4a participant is 21 years of age or older and that wagering on
5Internet games is limited to transactions that are initiated
6and received or otherwise made exclusively within the State of
7Illinois. A participant must satisfy the verification
8requirements before he or she may establish an Internet gaming
9account and wager on Internet games offered by Internet gaming
10licensees. All servers on which any Internet games are operated
11and conducted, and all underlying material technology, shall be
12located in the State of Illinois, unless the Division has
13otherwise authorized another location, which the Division may
14so authorize in its discretion if it maintains the ability to
15access or obtain all relevant data from such servers in such
16manner as it may specify. At such a time that a legally
17compliant mechanism is established to permit wagering on
18Internet games by individuals physically located outside of the
19State, the Division may adopt rules and procedures to allow and
20govern wagering by those individuals and shall have the
21authority to enter into multijurisdictional agreements and
22related and ancillary agreements in order to effectuate such
23wagering. An Internet gaming licensee's Internet gaming
24platform shall also provide mechanisms designed to detect and
25prevent the unauthorized use of Internet wagering accounts and
26to detect and prevent fraud, money laundering, and collusion.

 

 

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1If a participant in Internet gaming violates any provision of
2this Act or rule adopted by the Division, then the
3participant's winnings shall be forfeited. Forfeited winnings
4shall be deposited into the State Gaming Fund.
5    The following persons shall not be authorized to establish
6Internet gaming accounts or wager on Internet games offered by
7Internet gaming licensees, except where required and
8authorized by the Division for testing purposes or to otherwise
9fulfill the purposes set forth in this Act: (i) a minor under
1021 years of age; (ii) a current member of the Lottery Control
11Board; (iii) a current officer or other person employed by the
12Department of the Lottery, the Division of Internet Gaming, the
13Illinois Racing Board, or the Illinois Gaming Board; (iv) a
14spouse, civil union partner, child, brother, sister, or parent
15residing as a member of the same household in the principal
16place of abode of any persons identified in (ii) or (iii); and
17(iv) an individual whose name appears in the Division's
18responsible gaming database.
19    (b) The Division shall develop responsible gaming
20measures, including a statewide responsible gaming database
21identifying individuals who shall be prohibited from
22establishing an Internet wagering account or participating in
23Internet gaming offered by an Internet gaming licensee. The
24Executive Director may place a person on the responsible gaming
25database if that person (i) has been convicted in any
26jurisdiction of a felony or a crime involving gaming; (ii) has

 

 

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1violated this Act, the Illinois Horse Racing Act of 1975, the
2Riverboat Gambling Act, the Raffles and Poker Runs Act, the
3Illinois Pull Tabs and Jar Games Act, the Bingo License and Tax
4Act, the Charitable Games Act, or the Video Gaming Act; (iii)
5has performed any act or had a notorious or unsavory reputation
6that would adversely affect public confidence and trust in
7gaming; or (iv) has his or her name on any valid and current
8exclusion list from another jurisdiction in the United States
9or foreign jurisdiction. By rule, the Division shall adopt
10procedures for the establishment and maintenance of the
11responsible gaming database. The Illinois Gaming Board and the
12Illinois Racing Board, in a format specified by the Division,
13provide the Division with names of individuals to be included
14in the responsible gaming database. The Division may impose
15reasonable fees on persons authorized to access and use the
16responsible gaming database.
17    An Internet gaming licensee's Internet gaming platform
18shall offer in a clear, conspicuous, and accessible manner,
19responsible gambling services and technical controls to
20participants, including both temporary and permanent
21self-exclusion for all games offered; the ability for
22participants to establish their own periodic deposit and
23wagering limits and maximum playing times; referrals to crisis
24counseling and referral services for individuals and families
25experiencing difficulty as a result of problem or compulsive
26gambling; and other services as the Division reasonably may

 

 

10000SB0208sam001- 54 -LRB100 04954 AMC 27129 a

1determine are necessary or appropriate to reduce and prevent
2problem gambling. Any authorized participant who is allowed to
3participate in Internet gaming may voluntarily prohibit
4themselves from establishing an Internet gaming account. The
5Division shall incorporate the voluntary self-exclusion list
6into the responsible gaming database and maintain both the
7self-exclusion list and the responsible gaming database in a
8confidential manner. Notwithstanding any law to the contrary,
9the self-exclusion list and responsible gaming database are not
10public records subject to copying and disclosure under the
11Freedom of Information Act.
12    (c) There is created the Responsible Internet Gaming
13Advisory Board to make recommendations to the Executive
14Director regarding the development of rules and procedures to
15reduce and prevent problem or compulsive gambling and youth
16gambling and to ensure the conduct of safe, fair, and
17responsible Internet gaming. The Advisory Board shall consist
18of the following members:
19        (1) the Chairman of the Illinois Gaming Board, who
20    shall be an ex officio member and shall serve as
21    Chairperson;
22        (2) the Executive Director of the Division of Internet
23    Gaming, who shall be an ex officio member;
24        (3) one representative from a national organization
25    dedicated to the study and prevention of problem gambling,
26    appointed by the Board;

 

 

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1        (4) one member who is an academic professional engaged
2    in the study of problem gambling at a university or other
3    institution of higher learning, appointed by the Board;
4        (5) one member who has professional experience and
5    expertise in the field of technical and systemic controls
6    for responsible Internet gaming, appointed by the Board;
7    and
8        (6) one member who is an Illinois citizen and a member
9    of the public, appointed by the Board.
10    Each Advisory Board member shall serve for a term of 4
11years and until his or her successor is appointed and
12qualified. However, in making initial appointments, 2 shall be
13appointed to serve for 2 years and 2 shall be appointed to
14serve for 4 years. Appointments to fill vacancies shall be made
15in the same manner as original appointments for the unexpired
16portion of the vacated term. Initial terms shall begin on the
17effective date of this Act. Each member of the Advisory Board
18shall be eligible for reappointment at the discretion of the
19Board. A member of the Advisory Board may be removed from
20office for just cause. Advisory Board members shall receive no
21compensation, but shall be reimbursed for expenses incurred in
22connection with their duties as Advisory Board members.
23    Four members shall constitute a quorum. A majority vote of
24the Advisory Board is required for an Advisory Board decision.
25The Advisory Board shall meet no less often than once every 6
26months and shall meet as often as the Chairperson deems

 

 

10000SB0208sam001- 56 -LRB100 04954 AMC 27129 a

1necessary. Advisory Board members shall not be liable for any
2of their acts, omissions, decisions, or any other conduct in
3connection with their duties on the Advisory Board, except
4those involving willful, wanton, or intentional misconduct.
5    The Advisory Board may have such powers as may be granted
6by the Executive Director to carry out the provisions of this
7Act regarding responsible Internet gaming.
 
8    Section 5-55. Tax rate and distribution.
9    (a) Except as otherwise provided in this subsection (a), a
10tax is hereby imposed on Internet gaming licensees, based on
11the gross gaming revenue received by an Internet gaming
12licensee from Internet games authorized under this Act, at the
13rate of 15% of annual gross gaming revenue for all fee-based
14games and all non-fee-based games.
15    The taxes imposed by this Section shall be paid by the
16Internet gaming licensee to the Division no later than 5:00
17p.m. on the day after the day when the wagers were made.
18    In recognition of the advance tax revenue paid by the
19Internet gaming licensee in its license fee, an Internet gaming
20licensee shall be taxed at the following rates during the
21initial 5-year license term:
22        (1) for all non-fee-based games, the tax shall be 10%
23    of annual gross non-fee-based gaming revenue up to and
24    including $100,000,000 of gross gaming revenue and 15% of
25    annual gross non-fee-based gaming revenue in excess

 

 

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1    $100,000,000 of gross gaming revenue; and
2        (2) for all fee-based games, the tax shall be 10% of
3    annual gross fee-based gaming revenue up to and
4    $100,000,000 of gross gaming revenue and 15% of annual
5    gross fee-based gaming revenue in excess $100,000,000 of
6    gross gaming revenue.
7    (b) $10,000,000 from the tax revenue deposited in the State
8Gaming Fund under this Act shall be paid annually to the
9Department of Human Services for the administration of programs
10to treat problem gambling.
11    (c) From the tax revenue deposited into the State Gaming
12Fund under this Act, 5% shall be transferred into the Depressed
13Communities Economic Development Fund annually.
14    (d) After the amounts specified in subsections (b) and (c)
15have been paid or transferred, all remaining tax revenue
16deposited in the State Gaming Fund in accordance with this Act
17shall be transferred in equal parts to the Pension
18Stabilization Fund and Education Assistance Fund.
 
19    Section 5-60. Applicability of the Riverboat Gambling Act
20and the Uniform Penalty and Interest Act. The provisions of the
21Riverboat Gambling Act, and all rules adopted thereunder, shall
22apply to the Internet Gaming Act, except where there is a
23conflict between the 2 Acts. All provisions of the Uniform
24Penalty and Interest Act shall apply, as far as practicable, to
25the subject matter of this Act to the same extent as if such

 

 

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1provisions were included herein.
 
2    Section 5-65. Rulemaking. The Board shall adopt emergency
3rules to administer this Act in accordance with Section 5-45 of
4the Illinois Administrative Procedure Act. For the purposes of
5the Illinois Administrative Procedure Act, the General
6Assembly finds that the adoption of rules to implement this Act
7is deemed an emergency and necessary to the public interest,
8safety, and welfare.
 
9
Article 90. Amendatory Provisions

 
10    Section 90-5. The State Finance Act is amended by adding
11Section 5.878 as follows:
 
12    (30 ILCS 105/5.878 new)
13    Sec. 5.878. The Depressed Communities Economic Development
14Fund.
 
15    Section 90-10. The Department of Commerce and Economic
16Opportunity Law of the Civil Administrative Code of Illinois is
17amended by adding Section 605-530 as follows:
 
18    (20 ILCS 605/605-530 new)
19    Sec. 605-530. The Depressed Communities Economic
20Development Board.

 

 

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1    (a) The Depressed Communities Economic Development Board
2is created as an advisory board within the Department of
3Commerce and Economic Opportunity. The Board shall consist of
4the following members:
5        (1) 2 members appointed by the Governor, one of whom
6    shall be appointed to serve an initial term of one year and
7    2 of whom shall be appointed to serve an initial term of 2
8    years;
9        (2) 2 members appointed by the Speaker of the House of
10    Representatives, one of whom shall be appointed to serve an
11    initial term of one year and one of whom shall be appointed
12    to serve an initial term of 2 years;
13        (3) 2 members appointed by the President of the Senate,
14    one of whom shall be appointed to serve an initial term of
15    one year and one of whom shall be appointed to serve an
16    initial term of 2 years;
17        (4) 2 members appointed by the Minority Leader of the
18    House of Representatives, one of whom shall be appointed to
19    serve an initial term of one year and one of whom shall be
20    appointed to serve an initial term of 2 years; and
21        (5) 2 members appointed by the Minority Leader of the
22    Senate, one of whom shall be appointed to serve an initial
23    term of one year and one of whom shall be appointed to
24    serve an initial term of 2 years.
25    The members of the Board shall elect a member to serve as
26chair of the Board. The members of the Board shall reflect the

 

 

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1composition of the Illinois population with regard to ethnic
2and racial composition.
3    After the initial terms, each member shall be appointed to
4serve a term of 2 years and until his or her successor has been
5appointed and assumes office. If a vacancy occurs in the Board
6membership, then the vacancy shall be filled in the same manner
7as the initial appointment. No member of the Board shall, at
8the time of his or her appointment or within 2 years before the
9appointment, hold elected office or be appointed to a State
10board, commission, or agency. All Board members are subject to
11the State Officials and Employees Ethics Act.
12    (b) Board members shall serve without compensation, but may
13be reimbursed for their reasonable travel expenses from funds
14available for that purpose. The Department of Commerce and
15Economic Opportunity shall provide staff and administrative
16support services to the Board.
17    (c) The Board must make recommendations, which must be
18approved by a majority of the Board, to the Department of
19Commerce and Economic Opportunity concerning the award of
20grants from amounts appropriated to the Department from the
21Depressed Communities Economic Development Fund, a special
22fund created in the State treasury. The Department must make
23grants to public or private entities submitting proposals to
24the Board to revitalize an Illinois depressed community. Grants
25may be used by these entities only for those purposes
26conditioned with the grant. For the purposes of this subsection

 

 

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1(c), plans for revitalizing an Illinois depressed community
2include plans intended to curb high levels of poverty,
3unemployment, job and population loss, and general distress. An
4Illinois depressed community is an area where the poverty rate,
5as determined by using the most recent data released by the
6United States Census Bureau, is at least 3% greater than the
7State poverty rate as determined by using the most recent data
8released by the United States Census Bureau.
 
9    Section 90-15. The Criminal Code of 2012 is amended by
10changing Sections 28-1, 28-1.1, 28-3, and 28-5 as follows:
 
11    (720 ILCS 5/28-1)  (from Ch. 38, par. 28-1)
12    Sec. 28-1. Gambling.
13    (a) A person commits gambling when he or she:
14        (1) knowingly plays a game of chance or skill for money
15    or other thing of value, unless excepted in subsection (b)
16    of this Section;
17        (2) knowingly makes a wager upon the result of any
18    game, contest, or any political nomination, appointment or
19    election;
20        (3) knowingly operates, keeps, owns, uses, purchases,
21    exhibits, rents, sells, bargains for the sale or lease of,
22    manufactures or distributes any gambling device;
23        (4) contracts to have or give himself or herself or
24    another the option to buy or sell, or contracts to buy or

 

 

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1    sell, at a future time, any grain or other commodity
2    whatsoever, or any stock or security of any company, where
3    it is at the time of making such contract intended by both
4    parties thereto that the contract to buy or sell, or the
5    option, whenever exercised, or the contract resulting
6    therefrom, shall be settled, not by the receipt or delivery
7    of such property, but by the payment only of differences in
8    prices thereof; however, the issuance, purchase, sale,
9    exercise, endorsement or guarantee, by or through a person
10    registered with the Secretary of State pursuant to Section
11    8 of the Illinois Securities Law of 1953, or by or through
12    a person exempt from such registration under said Section
13    8, of a put, call, or other option to buy or sell
14    securities which have been registered with the Secretary of
15    State or which are exempt from such registration under
16    Section 3 of the Illinois Securities Law of 1953 is not
17    gambling within the meaning of this paragraph (4);
18        (5) knowingly owns or possesses any book, instrument or
19    apparatus by means of which bets or wagers have been, or
20    are, recorded or registered, or knowingly possesses any
21    money which he has received in the course of a bet or
22    wager;
23        (6) knowingly sells pools upon the result of any game
24    or contest of skill or chance, political nomination,
25    appointment or election;
26        (7) knowingly sets up or promotes any lottery or sells,

 

 

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1    offers to sell or transfers any ticket or share for any
2    lottery;
3        (8) knowingly sets up or promotes any policy game or
4    sells, offers to sell or knowingly possesses or transfers
5    any policy ticket, slip, record, document or other similar
6    device;
7        (9) knowingly drafts, prints or publishes any lottery
8    ticket or share, or any policy ticket, slip, record,
9    document or similar device, except for such activity
10    related to lotteries, bingo games and raffles authorized by
11    and conducted in accordance with the laws of Illinois or
12    any other state or foreign government;
13        (10) knowingly advertises any lottery or policy game,
14    except for such activity related to lotteries, bingo games
15    and raffles authorized by and conducted in accordance with
16    the laws of Illinois or any other state;
17        (11) knowingly transmits information as to wagers,
18    betting odds, or changes in betting odds by telephone,
19    telegraph, radio, semaphore or similar means; or knowingly
20    installs or maintains equipment for the transmission or
21    receipt of such information; except that nothing in this
22    subdivision (11) prohibits transmission or receipt of such
23    information for use in news reporting of sporting events or
24    contests; or
25        (12) knowingly establishes, maintains, or operates an
26    Internet site that permits a person to play a game of

 

 

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1    chance or skill for money or other thing of value by means
2    of the Internet or to make a wager upon the result of any
3    game, contest, political nomination, appointment, or
4    election by means of the Internet. This item (12) does not
5    apply to activities referenced in items (6), and (6.1) ,
6    (15), or (16) of subsection (b) of this Section.
7    (b) Participants in any of the following activities shall
8not be convicted of gambling:
9        (1) Agreements to compensate for loss caused by the
10    happening of chance including without limitation contracts
11    of indemnity or guaranty and life or health or accident
12    insurance.
13        (2) Offers of prizes, award or compensation to the
14    actual contestants in any bona fide contest for the
15    determination of skill, speed, strength or endurance or to
16    the owners of animals or vehicles entered in such contest.
17        (3) Pari-mutuel betting as authorized by the law of
18    this State.
19        (4) Manufacture of gambling devices, including the
20    acquisition of essential parts therefor and the assembly
21    thereof, for transportation in interstate or foreign
22    commerce to any place outside this State when such
23    transportation is not prohibited by any applicable Federal
24    law; or the manufacture, distribution, or possession of
25    video gaming terminals, as defined in the Video Gaming Act,
26    by manufacturers, distributors, and terminal operators

 

 

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1    licensed to do so under the Video Gaming Act.
2        (5) The game commonly known as "bingo", when conducted
3    in accordance with the Bingo License and Tax Act.
4        (6) Lotteries when conducted by the State of Illinois
5    in accordance with the Illinois Lottery Law. This exemption
6    includes any activity conducted by the Department of
7    Revenue to sell lottery tickets pursuant to the provisions
8    of the Illinois Lottery Law and its rules.
9        (6.1) The purchase of lottery tickets through the
10    Internet for a lottery conducted by the State of Illinois
11    under the program established in Section 7.12 of the
12    Illinois Lottery Law.
13        (7) Possession of an antique slot machine that is
14    neither used nor intended to be used in the operation or
15    promotion of any unlawful gambling activity or enterprise.
16    For the purpose of this subparagraph (b)(7), an antique
17    slot machine is one manufactured 25 years ago or earlier.
18        (8) Raffles and poker runs when conducted in accordance
19    with the Raffles and Poker Runs Act.
20        (9) Charitable games when conducted in accordance with
21    the Charitable Games Act.
22        (10) Pull tabs and jar games when conducted under the
23    Illinois Pull Tabs and Jar Games Act.
24        (11) Gambling games conducted on riverboats when
25    authorized by the Riverboat Gambling Act.
26        (12) Video gaming terminal games at a licensed

 

 

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1    establishment, licensed truck stop establishment, licensed
2    fraternal establishment, or licensed veterans
3    establishment when conducted in accordance with the Video
4    Gaming Act.
5        (13) Games of skill or chance where money or other
6    things of value can be won but no payment or purchase is
7    required to participate.
8        (14) Savings promotion raffles authorized under
9    Section 5g of the Illinois Banking Act, Section 7008 of the
10    Savings Bank Act, Section 42.7 of the Illinois Credit Union
11    Act, Section 5136B of the National Bank Act (12 U.S.C.
12    25a), or Section 4 of the Home Owners' Loan Act (12 U.S.C.
13    1463).
14        (15) Interactive fantasy sports contests and
15    participation in interactive fantasy sports contests
16    authorized under the Fantasy Sports Contest Act.
17        (16) Internet wagering when conducted in accordance
18    with the Internet Gaming Act.
19    (c) Sentence.
20    Gambling is a Class A misdemeanor. A second or subsequent
21conviction under subsections (a)(3) through (a)(12), is a Class
224 felony.
23    (d) Circumstantial evidence.
24    In prosecutions under this Section circumstantial evidence
25shall have the same validity and weight as in any criminal
26prosecution.

 

 

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1(Source: P.A. 98-644, eff. 6-10-14; 99-149, eff. 1-1-16.)
 
2    (720 ILCS 5/28-1.1)   (from Ch. 38, par. 28-1.1)
3    Sec. 28-1.1. Syndicated gambling.
4    (a) Declaration of Purpose. Recognizing the close
5relationship between professional gambling and other organized
6crime, it is declared to be the policy of the legislature to
7restrain persons from engaging in the business of gambling for
8profit in this State. This Section shall be liberally construed
9and administered with a view to carrying out this policy.
10    (b) A person commits syndicated gambling when he or she
11operates a "policy game" or engages in the business of
12bookmaking.
13    (c) A person "operates a policy game" when he or she
14knowingly uses any premises or property for the purpose of
15receiving or knowingly does receive from what is commonly
16called "policy":
17        (1) money from a person other than the bettor or player
18    whose bets or plays are represented by the money; or
19        (2) written "policy game" records, made or used over
20    any period of time, from a person other than the bettor or
21    player whose bets or plays are represented by the written
22    record.
23    (d) A person engages in bookmaking when he or she knowingly
24receives or accepts more than five bets or wagers upon the
25result of any trials or contests of skill, speed or power of

 

 

10000SB0208sam001- 68 -LRB100 04954 AMC 27129 a

1endurance or upon any lot, chance, casualty, unknown or
2contingent event whatsoever, which bets or wagers shall be of
3such size that the total of the amounts of money paid or
4promised to be paid to the bookmaker on account thereof shall
5exceed $2,000. Bookmaking is the receiving or accepting of bets
6or wagers regardless of the form or manner in which the
7bookmaker records them.
8    (e) Participants in any of the following activities shall
9not be convicted of syndicated gambling:
10        (1) Agreements to compensate for loss caused by the
11    happening of chance including without limitation contracts
12    of indemnity or guaranty and life or health or accident
13    insurance;
14        (2) Offers of prizes, award or compensation to the
15    actual contestants in any bona fide contest for the
16    determination of skill, speed, strength or endurance or to
17    the owners of animals or vehicles entered in the contest;
18        (3) Pari-mutuel betting as authorized by law of this
19    State;
20        (4) Manufacture of gambling devices, including the
21    acquisition of essential parts therefor and the assembly
22    thereof, for transportation in interstate or foreign
23    commerce to any place outside this State when the
24    transportation is not prohibited by any applicable Federal
25    law;
26        (5) Raffles and poker runs when conducted in accordance

 

 

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1    with the Raffles and Poker Runs Act;
2        (6) Gambling games conducted on riverboats when
3    authorized by the Riverboat Gambling Act;
4        (7) Video gaming terminal games at a licensed
5    establishment, licensed truck stop establishment, licensed
6    fraternal establishment, or licensed veterans
7    establishment when conducted in accordance with the Video
8    Gaming Act; and
9        (8) Savings promotion raffles authorized under Section
10    5g of the Illinois Banking Act, Section 7008 of the Savings
11    Bank Act, Section 42.7 of the Illinois Credit Union Act,
12    Section 5136B of the National Bank Act (12 U.S.C. 25a), or
13    Section 4 of the Home Owners' Loan Act (12 U.S.C. 1463);
14    and .
15        (9) Internet wagering when conducted in accordance
16    with the Internet Gaming Act.
17    (f) Sentence. Syndicated gambling is a Class 3 felony.
18(Source: P.A. 98-644, eff. 6-10-14; 99-149, eff. 1-1-16.)
 
19    (720 ILCS 5/28-3)   (from Ch. 38, par. 28-3)
20    Sec. 28-3. Keeping a Gambling Place. A "gambling place" is
21any real estate, vehicle, boat or any other property whatsoever
22used for the purposes of gambling other than gambling conducted
23in the manner authorized by the Riverboat Gambling Act,
24Internet Gaming Act, or the Video Gaming Act. Any person who
25knowingly permits any premises or property owned or occupied by

 

 

10000SB0208sam001- 70 -LRB100 04954 AMC 27129 a

1him or under his control to be used as a gambling place commits
2a Class A misdemeanor. Each subsequent offense is a Class 4
3felony. When any premises is determined by the circuit court to
4be a gambling place:
5    (a) Such premises is a public nuisance and may be proceeded
6against as such, and
7    (b) All licenses, permits or certificates issued by the
8State of Illinois or any subdivision or public agency thereof
9authorizing the serving of food or liquor on such premises
10shall be void; and no license, permit or certificate so
11cancelled shall be reissued for such premises for a period of
1260 days thereafter; nor shall any person convicted of keeping a
13gambling place be reissued such license for one year from his
14conviction and, after a second conviction of keeping a gambling
15place, any such person shall not be reissued such license, and
16    (c) Such premises of any person who knowingly permits
17thereon a violation of any Section of this Article shall be
18held liable for, and may be sold to pay any unsatisfied
19judgment that may be recovered and any unsatisfied fine that
20may be levied under any Section of this Article.
21(Source: P.A. 96-34, eff. 7-13-09.)
 
22    (720 ILCS 5/28-5)  (from Ch. 38, par. 28-5)
23    Sec. 28-5. Seizure of gambling devices and gambling funds.
24    (a) Every device designed for gambling which is incapable
25of lawful use or every device used unlawfully for gambling

 

 

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1shall be considered a "gambling device", and shall be subject
2to seizure, confiscation and destruction by the Department of
3State Police or by any municipal, or other local authority,
4within whose jurisdiction the same may be found. As used in
5this Section, a "gambling device" includes any slot machine,
6and includes any machine or device constructed for the
7reception of money or other thing of value and so constructed
8as to return, or to cause someone to return, on chance to the
9player thereof money, property or a right to receive money or
10property. With the exception of any device designed for
11gambling which is incapable of lawful use, no gambling device
12shall be forfeited or destroyed unless an individual with a
13property interest in said device knows of the unlawful use of
14the device.
15    (b) Every gambling device shall be seized and forfeited to
16the county wherein such seizure occurs. Any money or other
17thing of value integrally related to acts of gambling shall be
18seized and forfeited to the county wherein such seizure occurs.
19    (c) If, within 60 days after any seizure pursuant to
20subparagraph (b) of this Section, a person having any property
21interest in the seized property is charged with an offense, the
22court which renders judgment upon such charge shall, within 30
23days after such judgment, conduct a forfeiture hearing to
24determine whether such property was a gambling device at the
25time of seizure. Such hearing shall be commenced by a written
26petition by the State, including material allegations of fact,

 

 

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1the name and address of every person determined by the State to
2have any property interest in the seized property, a
3representation that written notice of the date, time and place
4of such hearing has been mailed to every such person by
5certified mail at least 10 days before such date, and a request
6for forfeiture. Every such person may appear as a party and
7present evidence at such hearing. The quantum of proof required
8shall be a preponderance of the evidence, and the burden of
9proof shall be on the State. If the court determines that the
10seized property was a gambling device at the time of seizure,
11an order of forfeiture and disposition of the seized property
12shall be entered: a gambling device shall be received by the
13State's Attorney, who shall effect its destruction, except that
14valuable parts thereof may be liquidated and the resultant
15money shall be deposited in the general fund of the county
16wherein such seizure occurred; money and other things of value
17shall be received by the State's Attorney and, upon
18liquidation, shall be deposited in the general fund of the
19county wherein such seizure occurred. However, in the event
20that a defendant raises the defense that the seized slot
21machine is an antique slot machine described in subparagraph
22(b) (7) of Section 28-1 of this Code and therefore he is exempt
23from the charge of a gambling activity participant, the seized
24antique slot machine shall not be destroyed or otherwise
25altered until a final determination is made by the Court as to
26whether it is such an antique slot machine. Upon a final

 

 

10000SB0208sam001- 73 -LRB100 04954 AMC 27129 a

1determination by the Court of this question in favor of the
2defendant, such slot machine shall be immediately returned to
3the defendant. Such order of forfeiture and disposition shall,
4for the purposes of appeal, be a final order and judgment in a
5civil proceeding.
6    (d) If a seizure pursuant to subparagraph (b) of this
7Section is not followed by a charge pursuant to subparagraph
8(c) of this Section, or if the prosecution of such charge is
9permanently terminated or indefinitely discontinued without
10any judgment of conviction or acquittal (1) the State's
11Attorney shall commence an in rem proceeding for the forfeiture
12and destruction of a gambling device, or for the forfeiture and
13deposit in the general fund of the county of any seized money
14or other things of value, or both, in the circuit court and (2)
15any person having any property interest in such seized gambling
16device, money or other thing of value may commence separate
17civil proceedings in the manner provided by law.
18    (e) Any gambling device displayed for sale to a riverboat
19gambling operation or Internet gaming operation or used to
20train occupational licensees of a riverboat gambling operation
21or Internet gaming operation as authorized under the Riverboat
22Gambling Act or Internet Gaming Act is exempt from seizure
23under this Section.
24    (f) Any gambling equipment, devices and supplies provided
25by a licensed supplier or licensed Internet gaming vendor in
26accordance with the Riverboat Gambling Act or Internet Gaming

 

 

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1Act which are removed from a the riverboat or Internet gaming
2facility for repair are exempt from seizure under this Section.
3    (g) The following video gaming terminals are exempt from
4seizure under this Section:
5        (1) Video gaming terminals for sale to a licensed
6    distributor or operator under the Video Gaming Act.
7        (2) Video gaming terminals used to train licensed
8    technicians or licensed terminal handlers.
9        (3) Video gaming terminals that are removed from a
10    licensed establishment, licensed truck stop establishment,
11    licensed fraternal establishment, or licensed veterans
12    establishment for repair.
13(Source: P.A. 98-31, eff. 6-24-13.)".