Federal Criminal Statutes and Online Gambling

Increasingly, Internet-based platforms are used for entertainment and recreational activities, such as online gambling. However, the use of the Internet to engage in gambling has generated concerns about how federal criminal statutes apply to this activity. In some cases, state officials have expressed concern that the Internet may be used to transport illegal gambling into their jurisdictions.

Some research has also shown that excessive Internet use can be a symptom of gaming and may lead to disordered gambling. There is a risk that playing on insecure websites puts banking and personal information at risk.

The federal government’s ability to prosecute illegal Internet gambling has raised questions about the scope of the Commerce Clause. The Commerce Clause provides for the ability of the federal government to regulate interstate commerce, but not for the government to prohibit private citizens from engaging in commerce.

Section 1956 of the Communications Act creates several distinct crimes for which Internet gambling can be a proximate cause. These include laundering with intent to promote illicit activity, money laundering, and laundering to conceal or disguise a crime.

The Commerce Clause has been used to challenge the enforcement of federal gambling laws on constitutional grounds, but these attacks have been unsuccessful so far. The First Amendment provides limited protection for activities that facilitate speech, which encumbers free speech objections in such situations.

The United States v. K23 Group Financial Services is a criminal case that charges Internet poker operators with violations of the UIGEA and 18 U.S.C.