The Law of Internet Gambling

Online Gambling

Internet gambling has become quite popular. Due to technological advances, online gaming has become more accessible. However, the Internet also offers illegal gambling. This form of gambling is regulated under seven federal criminal statutes. These include the Wire Act, the Illegal Gambling Business Act, and Racketeer Influenced and Corrupt Organizations (RICO) provisions.

The first online gambling venue for the general public was the Liechtenstein International Lottery. In this case, the gambling activity was defined by the act of transmitting information from New York through the internet.

A more comprehensive analysis of the law of Internet gambling was published in December 2002. It was called Internet Gambling: Overview of Issues.

While state laws are the primary issue in the matter, federal law often reinforces or supplants state law in a case. For example, in the United States v. Interactive Media Entertainment and Gaming Ass’n, a gambling case, the Fourth Circuit held that a gambling business operated by PayPal in Florida could not be prosecuted because the business was essentially a common carrier.

Other legal issues have been raised with respect to the Commerce Clause and free speech. However, these attacks have been unsuccessful. Whether the First Amendment restricts the government from regulating activities that occur in part overseas is unclear.

Several state officials have expressed concern that the Internet could be used to bring illegal gambling into their jurisdiction. They are concerned about the potential for Internet gambling to create conflicts between state and federal law.