Federal Laws Implicated by Online Gambling

Online gambling is the practice of placing bets or wagers on sporting events or other activities involving chance. These activities include casinos, lotteries, sports betting, online poker, virtual poker, and bingo. There are several federal criminal statutes that are implicated by illegal Internet gambling. Generally, these laws prohibit gambling activity that is prohibited in the state of operation and that involves receiving, placing, or transmitting bets.

Several state officials have expressed concerns about Internet-based gambling. They have argued that the Internet could easily be used to facilitate unlawful gambling within their jurisdiction. In response to these concerns, individual states have taken their time to regulate their own gambling industries.

Federal law reinforces state law in cases where the state has failed to exercise its authority. Currently, there are seven federal criminal statutes that are implicated by the use of the Internet for illegal gambling. Each of these statutes is applicable to Internet casinos. The laws are the Wire Act, the Illegal Gambling Business Act, the Unlawful Internet Gambling Enforcement Act, the Interstate Commerce Act, the Money Laundering Control and Financing Act, the Federal Wire Act, and the Federal Communications Commission’s Act.

In addition to the Wire Act, the Travel Act is an important federal law that is relevant to illegal gambling on the Internet. The Travel Act prohibits facilitating gambling, money laundering, and promotion of unlawful gambling. It also requires that all facilities involved in such activity be licensed or approved.