Online gambling is the act of placing a bet or playing a game of chance for money. A number of different types of gambling are present online, including virtual poker, sports betting and casinos. Although online gambling is legal in many states, there are several federal statutes that are associated with illegal Internet gambling. These include the Illegal Gambling Business Act and the Wire Act.
The First Amendment to the United States Constitution does not protect gambling in the home. However, there are laws that ban certain forms of sexual conduct in the home. Similarly, the state of New York considers an act of entering a bet to constitute gambling activity.
One of the more nebulous aspects of internet gambling is the best way to verify that a website is legitimate. Some companies require an ID and others let you use a credit card or PayPal. Some online gambling sites do not accept local currency and may even restrict you from making real money transactions.
The best casinos have smooth software and quick deposits and withdrawals. Some offer free spins and welcome bonuses to lure in new players. Moreover, regulated sites have independent auditors to check that the payouts are accurate.
Although a number of laws are in play, the most important is the Online Gambling Regulation Act (OGRA). This law was passed in 2001 to regulate the online gaming industry. It has several sections, including section 13(4)(b). OGRA is commonly abbreviated to OGRA.
Other federal statutes are the Travel Act and the Gambling Devices Transportation Act (Johnson Act). Both of these laws prohibit the use of interstate or foreign elements to facilitate a violation of state gambling laws. These statutes have been used to challenge the validity of federal gambling regulations.
The most common objection to these laws is that they violate the Commerce Clause, which is not surprising considering the commercial nature of the gambling industry. This law also comes with the obligatory Congressional findings on how it might affect interstate commerce. This is especially true when the statutes impose penalties on gambling businesses located in other states.
The Liechtenstein International Lottery was the first online venue to host a public game. Unlike traditional casinos, online gambling websites don’t have to have a physical presence, which makes the industry more scoff-worthy.
The Unlawful Internet Gambling Enforcement Act (UIGEA) and the Illegal Gambling Business Act (IGBA) are two of the federal laws that are enacted to combat the growing number of illegal Internet gambling operations. These two laws are the most significant in the eyes of the government, and the penalties associated with their use are more than intimidating. As of November 2011, the UIGEA had revoked the licenses of more than a dozen operators. In addition, the Wire Act has been enforced as well.
There are a number of other statutes that are related to illegal Internet gambling. The CRS report RS21984 discusses many of them, in abridged form. Despite the federal government’s lack of clarity on some of the most fundamental principles governing the industry, online casinos and other gambling entities are still operating with some degree of success.