Online Gambling Laws

US Online Gambling Laws


When it comes to online gambling, the laws and regulations can seem a bit murky. Illegal online gambling is rarely enforced due to this murkiness, though most state legislation is completely against Internet gambling.

There are a few exceptions in online gambling laws by state, though; only three states and the US Virgin Islands allow legal online gambling in the US: Nevada – an obvious first – New Jersey, and Delaware.

Some states are following suit, including California, Pennsylvania, New York, Massachusetts, Illinois, Mississippi, Iowa and Washington. While online gambling is slowly becoming accepted in the United States, the majority of states are still extremely against the act.

Most people argue that poker is a game of skill – not a game of chance – and this alone should make online poker legal everywhere. To confuse things further, some states are OK with online poker, yet not OK with online gambling, such as betting on sports events and wagering on horses. Many argue that The Federal Wire Act of 1961, which prohibits people from using wired communications to place bets, also includes the Internet. Therefore, online gambling should be permanently illegal.

For those few states where online gambling is legal, licenses are only granted to those who already have a brick and mortar business, such as the New Jersey’s Tropicana or Borgata – both of which have online casinos. This demand alone limits people from entering into the online casino business.

So what happens if someone gets caught gambling online in an illegal area? Generally nothing – though the gambler could lose winnings and receive a fine. However, online gambling is rarely punished, and people are rarely prosecuted. In some states such as South Carolina, even owning a pack of cards or even a game with dice such as Monopoly is technically illegal. This extreme law was passed in 1802, and was never properly amended with fear that it would draw gamblers into the state.

With all of this controversy, though, many states are making headway in this unclear business of online gambling.  As more states make it legal, others begin to accept it. Expect some changes in online gambling law over the next decade – especially from the states that neighbor others where gambling online is already legal. However, for more conservative states such as Utah, which doesn’t have a lottery, online gambling may never happen. Overall, the next decade should be interesting for those wanting to gamble online.