The Federal Government’s View on Online Gambling
Internet gambling is illegal under a number of federal criminal statutes. For instance, the Illegal Gambling Business Act (IGBA) and the Wire Act both make illegal gambling on the Internet.
Aside from the Wire Act, there are several other federal criminal statutes that have been implicated by the practice of illegal online gambling. These include the IGBA, the Travel Act, and the Racketeer Influenced and Corrupt Organizations (RICO) provisions.
One of the first legal venues for general public online gambling was the Liechtenstein International Lottery. The site also offered the first mobile gambling app.
Another is the UIGEA, which prohibits financial instruments for an illegal Internet gambling scheme. This includes wagers, deposits, and withdrawals. It is worth noting that the UIGEA’s financial transaction providers exemption is limited to those who are “engaged in the business of a financial exchange.”
In the end, though, there is little that the UIGEA does other than define unlawful Internet gambling. As a result, it is difficult to know what the law really says.
There have been numerous constitutional objections to the enforcement of federal gambling laws, primarily on the grounds of the Commerce Clause. Additionally, due process concerns have been raised, in part, with regard to regulation of activities occurring in part overseas. However, these arguments have had little success.
Finally, the CRS Report RS21984 is an excellent resource for anyone seeking information about the state laws that are relevant to the issue of internet gambling. The report also contains the text of a number of statutes cited.