The Federal Government’s Enforcement of Internet Gambling Laws
Using the internet to gamble is not a novel concept, but with the onset of the Internet and other new technologies, there has been an increase in the number of online casinos. There are a variety of online casino games, including blackjack, roulette, video poker, and slot machines. The games offered by the online casinos also include live dealer games.
There have been many questions raised about the constitutionality of the federal government’s enforcement of laws that prohibit gambling on the Internet. Many of the arguments have been based on the Due Process and Commerce Clauses. However, the arguments have been more or less unsuccessful.
While state laws have been cited as being the most common reason for prosecutions, the Federal Government has been able to use seven federal criminal statutes as evidence of illegal Internet gambling. These include the Wire Act, the Travel Act, the Interstate Commerce Act, the Unlawful Internet Gambling Enforcement Act (UIGEA), the Money Laundering Control Act, the Bank Secrecy Act, and the Electronic Funds Transfer Act.
According to the CRS Report RS22749, the most important feature of the Illegal Internet Gambling Enforcement Act is the fact that it prohibits the acceptance of financial instruments by online operators to facilitate illegal Internet bets. This includes PayPal. A federal prosecutors’ office warned that PayPal could face prosecution.
Among other things, the aforementioned law also provides that the Federal Communications Commission may terminate the leasing or maintenance of facilities that are used for Internet gambling. Furthermore, the act forbids gambling on sporting events. During the past five years, the number of Internet gambling venues has risen from just one in Liechtenstein to ten in the United States.
In addition to the UIGEA, the federal government has taken steps to regulate the gaming industry through the Racketeer Influenced and Corrupt Organizations (RICO) provisions. As of 2011, Racketeer Influenced and Corruption (RIC) organizations were reported to have engaged in a total of over $1.2 billion in transactions.
As a result, the United States has issued a series of court cases related to this type of activity. One of these cases involved the 5th Circuit Court of Appeals. Another involved the 10th Circuit, and a third case involves the 6th Circuit. Each of these cases was decided on different points of view. Several of the courts have reached different conclusions on the constitutionality of the law.
The United States also has its share of high-profile prosecutions of gambling cases. Most of these cases involve players who have illegally used interstate facilities for gambling. Some of these prosecutions have led to fines. Other prosecutions have led to the closure of illegal Internet gambling sites.
Generally, the federal government’s ability to prosecute Internet gambling has been limited by the limitations of the First Amendment. However, there are some notable exceptions to the rule.
Despite the limited legal authority, there are a variety of strategies that online gambling operators can use to protect themselves from potential prosecution. For instance, reputable online casinos will ensure that their banking options are safe and reliable, and will offer fast payouts.