Despite the fact that the Internet has revolutionized almost all aspects of modern life, online gambling remains illegal under federal law. Internet gambling, which means betting or placing bets on the Internet, is illegal under seven federal criminal statutes. One of those statutes is the Illegal Gambling Business Act (IGBA).
The Illegal Gambling Business Act defines illegal Internet gambling as receiving bets or placing bets, using any part of the Internet for gambling purposes, or transmitting bets or wagers over the Internet. The statute also includes a number of provisions aimed at protecting consumers and the gambling industry. These include provisions on age verification, appropriate data security standards, and location verification.
Another federal statute, the UIGEA, prohibits accepting financial instruments from illegal Internet bets. The statute prohibits all forms of Internet gambling, including sports betting. The UIGEA also prohibits gambling sites from conducting business in the United States. The statute also contains provisions to discourage gambling by restricting advertising to vulnerable groups and by requiring online gaming sites to offer a self-exclusion program.
The most obvious reason to regulate gambling is to discourage gambling. However, some state officials have expressed concerns that the Internet could facilitate illegal gambling into their jurisdictions. To discourage gambling, the government has enacted the following laws: The Wire Act, the UIGEA, the Travel Act, and the Gambling Control Act. The most important of these laws is the UIGEA, which prohibits a person who conducts online gambling from accepting financial instruments from an illegal Internet bet.
The simplest form of online gambling is sports betting. In this type of gambling, a person places a bet on the outcome of a sporting event, usually a football game. They are generally paid for winning, but lose money when they get it wrong. In this case, the money is real money. Sports betting is also legal in eleven states.
While the aforementioned statutes are the most important in enforcing federal laws, there are other federal statutes that affect gambling in the United States. One such statute is the Travel Act, which prohibits gambling on interstate commerce. Another statute is the Federal Communications Commission’s prohibition against the use of common carriers for illegal gambling. The Federal Communications Commission has statutory authority over common carriers, which includes Internet service providers. It may also be able to stop gambling sites from operating by banning leasing or furnishing facilities.
Several state attorneys general have also challenged federal gambling laws on constitutional grounds. This has included a challenge to the UIGEA, which was not without merit. However, the First Amendment’s guarantee of free speech may be insufficient in some cases. In one instance, federal prosecutors warned PayPal it could be prosecuted for accepting financial instruments from an illegal Internet bet.
Other federal statutes, such as the RICO statute, prohibit gambling activities by racketeer influenced and corrupt organizations. Other federal statutes, such as the Wire Act, prohibit illegal gambling on sporting events.
While it is unlikely that online gambling will ever replace the casino experience, it is safe to say that the industry will be a growing one for many years to come. Whether online gambling is legal or illegal in the United States will depend on the individual state’s laws, which may be inconsistent with the federal statutes.