Online gambling includes a wide range of activities, from sports betting to virtual poker. Many types of gambling are legal, while others are illegal in the US. For instance, online poker is illegal in the US, as it is in most other countries. Despite its legal status, it’s important to understand that it can be addictive, and it can lead to massive losses. Fortunately, there are steps you can take to minimize the risk of becoming a victim of online gambling.
The first step is to educate yourself about the federal laws that prohibit illegal internet gambling. These laws include the Wire Act, the Illegal Gambling Business Act, and the Travel Act. They are each designed to prevent illegal gambling on sporting events, in contests, and through interstate commerce. Unlike traditional casinos, which have a physical location, an online casino functions 24 hours a day, allowing gamblers to place bets on any time of the day or night.
Another federal law that affects online gambling is the Racketeer Influenced and Corrupt Organizations (RICO) provision. This statute prohibits certain business activities in the gaming industry, including those that involve telecommunications services or financial transaction providers. Similarly, the Unlawful Internet Gambling Enforcement Act (UIGEA) imposes additional criminal penalties on those who use the Internet to conduct illegal gambling.
The US Supreme Court has not decided whether UIGEA is constitutional. However, it has determined that it does not violate the Commerce Clause. Some of the arguments against UIGEA on the basis of free speech have been challenged on constitutional grounds, although the cases have not been successful.
Several state officials have also expressed concerns about the potential use of the Internet to illegally bring gambling into their jurisdictions. For example, in 2002, U.S. marshals seized $3.2 million from Discovery Communications, which operates the online channel Tropical Paradise. That case involved layoff bettors, as well as waitresses, bartenders, and managers of establishments with video poker machines.
Those who engage in illegal Internet gambling are violating seven federal criminal statutes. These statutes include 31 U.S.C. 5362, which defines unlawful Internet gambling as using or attempting to use an electronic communications network, system, or device to receive bets or transmit wagers for profit. That statute’s other provisions include age verification, receiving bets, and location verification. Among other things, it requires online gambling sites to be licensed and meet appropriate data security standards.
In addition to the federal statutes, state laws govern online gambling. These vary from state to state, and each one has its own specific rules. Some states have even banned the activity altogether.
While the federal government has the power to enforce these laws, it has been challenged on the basis of the First Amendment. This raises questions about the extent of the government’s authority to regulate gambling, especially on the Internet. The Congressional Research Service (CRS) has released a report on this subject, which includes citations to both state and federal gambling laws. Those seeking more information can visit the CRS Report RS21984 for a downloadable, abridged version of the report. The report is a useful resource for those looking to learn more about the issues surrounding online gambling.