Palacios, R-Saipan, introduced, House Bill 17-129 or the Internet Gambling Act which will provide for the regulation and control of internet gambling in the CNMI.
He told reporters that online gambling has been an existence for quite some time already and it continues without being checked by the government.
Although he is not aware of any internet gambling operator based in the CNMI, there are people in the islands who have been winning cash from cyber games, he said.
One of the banks on Saipan, Palacios added, confirmed to him that there have been internet gamblers withdrawing cash prizes from them.
The main purpose of H.B. 17-129, he said, is to regulate internet gambling so it can provide needed revenues.
Palacios also said that he already got a legal opinion saying that the federal laws on internet gambling do not apply to the CNMI.
The lawmaker said online gambling becomes “dirty” only when the operators are allowed to make it dirty, hence the need to regulate it.
He said there needs to be a gaming commission to regulate internet gambling.
The American Bankers Association posted on its website that the Department of the Treasury and the Federal Reserve Board issued a joint final rule on Dec. 18, 2008 to implement the Unlawful Internet Gambling Enforcement Act.
This law, enacted in 2006, “prohibits any person engaged in the business of betting or wagering…from knowingly accepting payments in connection with the participation of another person in unlawful Internet gambling.”
The final rule requires a strengthened screening process of account opening to deny commercial entities that may be acting as internet casinos access to the payment system. It also requires that policies and procedures be implemented to prevent all debit and credit card payments to internet casinos.
A CNMI government lawyer told Variety that the inter-state commercial clause of the U.S. Constitution does not apply in the CNMI.
Section 501 of the Covenant, which made the CNMI part of the U.S., does not include the federal gambling law on the list of U.S. constitutional provisions applicable here.
The Covenant provision also states that “other provisions of or amendments to the Constitution of the United States, which do not apply of their own force within the NMI will be applicable within the NMI only with the approval of the government of the NMI and of the government of the U.S.”
If internet gambling is allowed here, the lawyer said, winners can only withdraw their money from the banks in countries other than the U.S. Even the banks here on Saipan can have a problem releasing the winning pot if they are branches of banks in the U.S., said the lawyer who declined to be identified.
Senate President Paul A. Manglona, Ind.-Rota, in a separate interview said H.B. 17-129 “will not get out of the Senate without a detailed legal opinion.”
He said the question on how federal law may affect the CNMI once the bill becomes law was raised in the Senate.
The House passed the bill in November last year.
Some members of the House, including Palacios, want public hearings before the Senate acts on H.B. 17-129.
