Online Gambling is generally illegal in the United States, but it’s legal in many other countries. There are various forms of gambling, including casinos, virtual poker, sports betting, and pool-selling. Some states also allow certain types of online gambling. However, the laws vary widely from state to state, making it important to check with your local authorities.
The Internet Gambling Prohibition Act, which would have prohibited individuals from participating in Internet gambling, was introduced as a bill in the US Senate in 1999. It was subsequently defeated, and its proponents were unable to reach a consensus on the legislation. But the issue of whether and how to prosecute Internet gambling continues to be a matter of debate.
Several bills have been introduced in the US House over the past few years. One bill, known as HR 2046, would modify the Unlawful Internet Gambling Enforcement Act, or UIGEA, by requiring the director of the Financial Crimes Enforcement Network to license Internet gambling facilities. Another, called the Internet Gambling Regulation, Consumer Protection, and Enforcement Act, would establish a licensing system for Internet gambling.
In April 2007, Representative Barney Frank introduced HR 2046. The bills would have restricted some forms of Internet gambling, except for horse races, lotteries, and lottery-like activities. They also proposed amending the law to clarify that financial transaction providers and other parties that offer services for financial transactions to persons within the U.S. may not be licensed.
As more and more people began to use the Internet for gambling, the government has stepped up its efforts to enforce federal gambling laws. These efforts are based on the Commerce Clause, the Due Process Clause, and the First Amendment. While some of these attacks have been successful, others haven’t.
A federal criminal case was recently brought against several Internet poker companies. The defendants, including the founders of three of the largest such companies, are accused of money laundering and bank fraud. Other charges include violations of the Unlawful Internet Gambling Enforcement Act and the Wire Act. Currently, the owners of three of the companies, including the founder of PokerStars, face trial.
In the meantime, the Justice Department has announced that the Wire Act applies to all forms of Internet gambling. However, critics of the move argue that it has no legal basis. Many argue that the commercial nature of the gambling business seems to satisfy the Commerce Clause concerns.
Another federal statute, the Travel Act, is applicable to players who use an interstate facility for unlawful activities. It also provides for an increase in the risk of prosecution.
Regardless of the legal status of online gambling in the US, it is not recommended that you gamble on the Internet. If you do, be sure to know the laws in your area before you begin. Also, be careful when you use your credit card or debit card to fund your account. Most banks in the US are not authorized to process online gambling transactions.