The issue of legal online gambling has been a hot topic in the United States. Some states have adopted laws that permit online sports betting, while others have been slow to catch on. Online casinos are also becoming more popular. As more states look to legalize gambling, it is likely that more Americans will be able to play their favorite casino games online.
There is one federal law that relates specifically to illegal Internet gambling. This act, known as the Illegal Gambling Business Act, is used to prosecute the owners of such businesses. Those who operate such a business face up to five years in prison for committing the crime.
In addition, the Illegal Gambling Business Act and the Wire Act prohibit gambling on sporting events and contests. Other federal criminal statutes are implicated as well, including the Racketeer Influenced and Corrupt Organizations (RICO) act.
It is not uncommon to hear state officials complain that the Internet is being used to bring illegal gambling into their jurisdictions. One such example is the recent seizure of $3.2 million from Discovery Communications by U.S. marshals. However, the case has not yet made it to the Supreme Court.
The other major law pertaining to Internet gambling is the Unlawful Internet Gambling Enforcement Act (UIGEA). UIGEA is designed to regulate commercial activity in the gambling industry. It also includes factors to help weed out low-level gambling cases.
Another federal statute, the Travel Act, provides for the prohibition of money laundering and facilitating unlawful gambling. UIGEA has raised constitutional concerns. The statute is primarily a ban on money laundering, but it also prevents the promotion and facilitation of unlawful gambling. For instance, the statute prohibits shipments of gambling goods across state lines. Further, it limits the ability of states to enforce their own gambling laws.
The law has been challenged on a variety of grounds. Specifically, opponents have raised the First Amendment’s guarantee of free speech. Others have argued that the state’s ability to enforce the law conflicts with the Commerce Clause. While these arguments have not had much success, they have not ruled out the possibility that a state could take action against a company that has violated the law.
In December 2002, the General Accounting Office released an overview of the Internet gambling industry. Although it is not particularly detailed, the report included an abridged version of several related statutes and citations to state gambling laws.
The first online gambling venue for the general public was Liechtenstein’s International Lottery. That case was not cited in the Loyola of Los Angeles Entertainment Law Journal’s “Top 10 Legal Online Gambling Sites in the United States,” which focuses on a few other sites.
Other notable legal online gambling sites include BetMGM, PokerStars, and the World Series of Poker. These three sites have helped get businesses running in Michigan. Many other states have been experimenting with online poker, and a number of smaller casinos have also opened up to the Internet.