During the 1990s, internet gambling became a popular option. Players placed bets on casino games, poker and sports betting through their computer or Internet connection. In 2002, the Marquette Sports Law Journal published an overview of Internet gambling issues. Since then, more states have considered legalizing online gambling. However, state officials are concerned that online gambling could bring illegal gambling into their jurisdictions.
In the United States, gambling is primarily a matter of state law. Online gambling has been legalized in half of the states, but more states are expected to follow suit. In order to gamble legally, customers must have a valid gambling license. The license proves that the gambling site is legitimate. However, playing on a site with insecure security measures puts financial information and personal information at risk.
Gambling includes the following activities: casino games, sports betting, pool-selling, lottery, pool-playing, lotteries, slot machines, and roulette wheels. It also includes conducting games of chance and bookmaking. The state in which gambling occurs determines the types of activities that can take place and the location of the gambling.
Gambling establishments are found throughout the United States. However, they are often located near the borders of states. This allows them to avoid legal prosecution. Some state laws limit the age of the person able to participate in gambling. Other states may have a higher age limit than others, depending on the type of gambling activity being performed. For example, in New Jersey, a person must be at least 21 to be able to gamble at a casino.
The federal government also enforces federal gambling laws. However, some have challenged the enforcement of these laws on constitutional grounds. For example, the United States v. K23 Group Financial Services case charges Internet poker operators with violations of 18 U.S.C. 1955.
The Fifth Circuit disagreed with the Department of Justice’s position that Internet gambling is illegal. It held that the Wire Act is valid only when the act is legal in both the source and destination locations. The Wire Act applies to wagering businesses, and it is possible for operators to be fined and imprisoned for violations of the law.
The Department of Justice, however, argues that all Internet gambling is illegal. This is a point of contention in the House of Representatives, where several bills have been introduced to soften the federal Internet gambling law. The House has also considered a Skill Game Protection Act, which would clarify the Wire Act’s exemptions for certain games. In addition, House representatives have drafted the Internet Gambling Regulation and Tax Enforcement Act, which would regulate and tax Internet gambling businesses.
While the federal government has been successful in reinforcing state laws in cases, the dormant Commerce Clause doctrine has raised questions about whether the power of the federal government extends to gambling in non-state locations. Those questions have been addressed in CRS Report RS21984 and CRS Report RS22749. Both reports are available in abridged form.