Online gambling is a growing industry, especially in the United States. The Internet is a convenient way to play casino games, place bets on sports, and even perform virtual poker. Gambling is a legal activity, though the law is often challenged in court on constitutional grounds. There are many laws in place to protect people from gambling, including the Wire Act, the Illegal Gambling Business Act, and Racketeer Influenced and Corrupt Organizations (RICO) provisions.
Currently, online gambling is legal in a handful of states. However, there is a strong debate over whether the law applies to gambling conducted on the internet. Many state officials fear that the internet could be used to facilitate illegal gambling in their states. This has sparked a number of bills that would soften the federal online gambling law. A House Committee on the Judiciary held a hearing on online wagering policies.
The Wire Act, which is one of the federal statutes implicated by illegal internet gambling, prohibits betting on sports events and contests, gambling on the internet, and the transmission of bets. Operators can be fined or imprisoned. If the act is legal in both the source and destination states, the Wire Act would not apply.
One of the main issues is the constitutionality of the Commerce Clause. The Commerce Clause is the theory that the federal government has the power to regulate all interstate commerce. It is unclear if the Commerce Clause applies to Internet gambling. Since the Commerce Clause is not explicitly stated, it is uncertain what legal powers Congress has to regulate gambling in the Internet realm.
Another issue is the First Amendment. Under the Constitution, the government cannot interfere with free speech. However, the law does provide limited protection for crimes facilitating speech. While this does not provide complete protection, it does encumber objections to the violation of free speech.
The Travel Act is another federal law that prohibits the use of interstate facilities to engage in illegal gambling activities. It is also applicable to Internet casinos. These laws are largely unenforceable due to the dormant Commerce Clause doctrine. However, commercial activities in the gambling business may satisfy the Commerce Clause.
Although the Internet is now a popular medium for gambling, most American citizens can bet on sports or play casino games in their own communities. State gambling laws determine the types of bets that may be placed and the minimum age for wagering. For example, Colorado does not permit individual prop bets on college games. In some states, there is a common minimum age for all gambling. Similarly, Illinois does not allow bets on in-state colleges.
The Department of Justice has been exploring the regulations that are needed to ensure the law is effective in addressing online gambling. Recent cases have involved bartenders and managers of establishments with video poker machines.
The House is considering several bills to regulate online gambling. One bill, the Internet Gambling Regulation and Tax Enforcement Act, would require internet gambling businesses to be licensed and regulated. Another, the Skill Game Protection Act, would clarify the Wire Act to exclude certain games.