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 What is Legal Gambling?

There are certain types of gambling which are illegal in every state. The majority of states, however, recognize exceptions to this rule and allow some types of illegal gambling.

In the states which recognize these exceptions, there are legal statutes on the books which make certain forms of gambling illegal. In other states, these exceptions are recognized in practice only.

This means that, although the activity may still technically be illegal, an individual is unlikely to be arrested for it.

What Are Some Common Forms of Legal Gambling?

The types of gambling which are legal differ by state. There are, however, certain types of gambling that are more frequently treated as legal, which may include:

  • Social gambling;
  • Lotteries;
  • Charitable raffles;
  • Bingo; and
  • Betting on horse or dog races.

What Are Some Factors States Consider When Deciding Whether Gambling is Legal?

When determining whether certain forms of gambling are illegal or legal, a state will consider some of the following factors:

  • Is the game one of skill or chance? A game of skill will typically be given more leniency than a game of chance;
  • Are all gamblers on equal footing? If there are no house odds and no house income, the gambling is more likely to be legal;
  • How high are the stakes? Penny-ante games are going to be more likely to be legal than $100,000 stakes; and
  • Where does the gambling take place? Gambling in an individual’s own private home will be more likely to be legal than gambling in a public place.

What Qualifies as Online Gambling?

Online gambling may include a broad category of games, typically games of chance, where a user makes bets with the hopes of a higher payout than they put in. the most common forms of online gambling include:

  • Online lotteries;
  • Online casinos;
  • Online sports betting and
  • Fantasy sports.

Are Users of Online Gambling Websites at Risk for Prosecution?

In the United States, the legality of online gambling is governed by both the state and federal laws which regulate gambling. Although federal laws are fairly straightforward, the state laws typically ultimately control the issue.

State gambling laws vary from laws that completely prohibit gambling to laws that almost totally tolerate gambling.

How Can One Tell if an Online Gambling Site is Legal?

There are several ways an individual can attempt to determine if an online gambling site is legal or illegal. The best practice is to consult with an attorney if an individual is unsure of the site’s legality.

Ways an individual may determine the legality of a site include examining state and federal gambling laws. The legality of an online gaming site will largely be dictated by the forms of gambling which are permitted in the specific state.

In a state where all forms of gambling are illegal, then an internet gambling site that is headquartered in that state will also be illegal. In contrast, in a state which has legalized certain forms of gambling, an internet site which provides only acceptable forms of gambling is legal.

Federal legislation serves as the only applicable guide on the issue of the legality of gambling sites. The most widely used federal regulations for internet gambling sites are the Unlawful Internet Gambling Enforcement Act of 2006 and the Wire Wager Act.

The Unlawful Internet Gambling Enforcement Act of 2006 prohibits gambling companies from knowingly accepting wagers or bets that would be unlawful under any state or federal law over the Internet. This act has a specific exception for fantasy sports, provided the fantasy sport betting focuses on skill rather than chance and that the payout is not based on single, real-world performances.

The Wire Wager Act prohibits using a wire transmission facility to foster gambling. In order to prove a prima facie case for this offense, the government is required to show all of the following:

  • The individual was engaged in the business of betting or wagering;
  • The individual transmitted any of the following in interstate or foreign commerce:
    • Bets or wagers;
    • Information which assists with the placement of wagers or bets; and
    • Communications which entitle the recipient to receive money or credit as a result of a wager or a bet.

Who Does the Wire Wager Act Apply To?

The Wire Wager Act is usually applied to individuals who are engaged in the business of wagering and betting but not the gamblers themselves. This is because there is a key distinction at the federal level which seeks to separate those who merely bet from those individuals who benefit from that betting.

The application of the federal laws mostly focus on individuals who are affiliated with the business of facilitating various games.

What is Internet Poker?

Internet poker is one popular form of online gambling. Using the internet, players from around the world are able to figuratively sit down and play at the same poker tables.

There are countless websites which host online poker rooms. An online player may bet fake currency or real currency linked through a credit card.

Is it Legal to Play Internet Poker?

Currently, there are no federal laws against an individual playing poker online. The Supreme Court, however, has not provided an opinion on this matter.

Therefore, the lower courts have been able to rule on the issue which has produced a confusing set of legal decisions regarding whether the federal Wire Act applies to internet gambling websites.

In general, the Wire Act has not been applied to online poker. In addition, it seems unlikely that Congress will pass laws against internet poker, especially considering that it has a status as a game of skill instead of being considered a game of chance.

Washington State became the first state in June of 2006 to pass a law which makes internet poker illegal. In Washington State, online gambling is now classified as a felony.

If an individual is convicted of this offense, they may face penalties of up to 5 years in prison and a $10,000 criminal fine. There are other states which may soon follow suit and pass laws against internet poker.

The new state laws outlawing internet poker, however, are not expected to be enforced. They may instead be political moves by politicians who are seeking approval from various interest groups.

Other states, including North Dakota, are considering bills which would endorse internet poker and make it clearly legal. Although there is no clear answer regarding whether playing internet poker is legal, it appears unlikely that state or federal authorities would seek prosecution for the offense.

It is much more likely that the owners and operators of internet poker sites would be prosecuted under the existing state and federal laws.

Do I Need a Lawyer for My Internet Poker Problem?

If you have been charged with illegal gambling as a result of playing internet poker, you should consult with an entertainment attorney. Your attorney can advise you regarding the state and federal laws which may apply to your case.

If you are charged with illegally running an online poker website, you may face serious criminal and civil penalties. You should consult with an attorney who can advise you of your rights, help in your defense, and represent you in court.

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