Beating the Odds: Is Online Gambling Legal in All States?

posted by Chris Valentine

The global online gambling market is predicted to grow to $94.4 billion by 2024. Despite these huge figures, the question “is online gambling legal” is rampant. Many people have an interest in gambling but are afraid they might engage in it illegally.

It’s an uphill task to try to determine the exact number of people who gamble in the United States. The problem becomes complicated when you consider figures from across the world.

Since the focus is on gambling in the United States, let’s delve into its legality to learn more.

Online Gambling Laws

There exist no federal laws against gambling in the United States. Possibly laws against gambling exist at the state level, but penalties and prosecution are very rare. Some of the states that have anti-gambling laws are Nevada, New Jersey, and Delaware.

Recently, Pennsylvania opened its doors to online gambling. The online poker and iGaming sites were launched in 2018.

Nevada has three betting sites legally enshrined in the law. These are RealGaming, WSOP.com, and WorldWinner.com. WorldWinner.com is a platform that offers a variety of skill games.

The first two are for online poker.

Delaware has three online casinos and four off-track horse betting sites. According to the U.S. Attorney, placing wagers online doesn’t violate any part of the federal laws. There’s no American who has ever been arrested or prosecuted for online gambling.

This contradicts previous reports that Congress had outlawed online gambling. The 2006 law only made it illegal for banks to move gambling money. It didn’t in any way prohibit players from making bets.

No law prohibits a person from placing a bet online, but it’s not permitted by law to run a gambling operation. In other words, no one should take bets except in a few states where operators are licensed.

However, to answer the question “is online gambling legal” there isn’t a simple yes or no answer. Interpretation of the laws in various states has many gray areas.

The new upcoming gambling sites are further adding to the patchwork of laws and non-laws all over the nation.

Poor Interpretation of the Law

The gray areas surrounding the laws on gambling emerge from a misinterpretation of the Unlawful Gambling Enforcement Act. The provisions in the Act were in reference to wire transfers.

The Act prohibits any person or entity from knowingly accepting funds associated with illegal online gambling.

The critical component of the law is in the “accepting” not “sending” of money gained from gambling. More ridiculously, this law came into existence as an addition to the Legislation to the SAFE Port Act.

The SAFE Act was necessary for various reasons, but the legislators complained that they lacked time to read it.

Many Payment Processing Companies are used to facilitate money transfer from players to betting companies. According to the law, most of the operators live outside the United States.

The law hence creates a need for the companies to enable players to transfer funds to and from any gambling website.

The language in the Act was misinterpreted to make it illegal for players to move funds to online casinos outside the United States. It also prohibited them from sending money for online gambling through a payment processor.

At the national level, all these statements couldn’t be less accurate. There is no provision by the UIGEA that calls for the penalization of online players. Placing bets online and transferring of funds for the same should attract no penalty.

The State of Gambling in the Various States

As mentioned, there are very few specific betting laws that prohibit online gambling. The few anti-gambling laws apply to both offline and online gambling. A few states have exclusively legalized online gambling.

The catch, however, is for players to place their bets through the approved casinos. Some states have legalized only specific types of gambling like poker. Despite online gambling being legalized, some gaming sites won’t allow players from some states.

States That Prohibit Online Gambling

You’ll find that the jurisdictions that prohibit gambling and not specific on online gambling. They also don’t take into account the various types of gambling that exist. The general assumption is that anti-gambling laws apply to offline and online bet-placement.

States that are very clear about the illegality of online betting are

  • Indiana
  • Illinois
  • Louisiana
  • Montana
  • Wisconsin
  • Washington
  • Oregon
  • South Dakota
  • Arizona
  • Alabama

Despite the laws, you’ll find that for the penalties for online gambling are almost always very light. Gambling is considered a misdemeanor, but in Washington DC and Washington State, it’s regarded as a felony.

Alaska is not explicitly clear about online gambling. Its law only states that it’s an offense to engage in unlawful gambling, not expressly allowed by law. The state is permissive of social betting, but it’s unlikely that you’ll get into trouble for online gambling.

Legal Cases Against Online Gambling

The only two states where players were convicted of being guilty of gambling are North Dakota and Oklahoma. These two are incredibly conservative states. The players were charged under general laws against gambling.

In the first case, Jeffrey Trauman was charged a $500 fine for online bet winnings amounting to $100,000. That was in 2003. In 2011, Roland Benavides was charged and handed a deferred sentence in 2012.

He was exempted from a jail term only if he didn’t violate his probationary terms.

If you’re wondering “is online gambling legal,” consider being careful about gambling in Arkansas and Colorado. Here, the law views online gambling in the same way as driving offenses that could earn you a traffic ticket.

In a Kentucky case, a judge allowed the state to withdraw 141 domain names related to gambling. The grounds or seizure were that the names constituted a gambling device according to the state law.

The seizure was absurd because it meant that any country was at liberty to seize any domain name from around the world if it violates the local laws.

Majority of registrars didn’t comply, as most of the domains relocated to non-registrar services. They also stopped using “.com” domains.

This rendered the ruling disputable. The court of appeal turned down the ruling, but there were no domain updates to be found around that time.

Where Can You Legally Gamble Online in New Jersey?

New Jersey is among the most vibrant places for online gamblers.

By 2018, the Division of Gaming Enforcement in the state had given licenses to five different casinos in the Atlantic. It also presented players with a chance to wager on 20 various gambling websites.

The freedom of online gambling in New Jersey is on a higher level than most other states. Some of the places where you’ll enjoy your gambling session are at VirginCasino.com. Here, you get free $20 upon sign up.

Another offer is $100 cash back refund on first deposits. You can, therefore, open an account and gamble with $120 risk-free.

Recently, New Jersey also launched other online gambling sites like PokerStarsNJ.com, TropicanaCasino.com, and GoldenNuggetCasino.com.

New Jersey has invested heavily in world-class resorts and casinos. It passes as the best legal online gambling destination in the United States. If you’re looking for a place you can travel and gamble online while at it, plan a trip to New Jersey.

For other gamblers, using gambling sites outside the country, such as HappyLuke, is safer when you don’t understand local gambling laws.

What to Do Where the Law Is Not Clear

If you happen to visit a state where you might be wondering “is online gambling legal,” the best thing to do is research the rules.

Checking the Municipal or County regulations to see if there are prohibitions against it will keep you safe. You may also try to determine if anyone in that state has been found guilty or charged for online gambling.

You might find that the sport is technically illegal, but not necessarily enforceable. Note that most of the laws were formulated before the age of the internet and haven’t undergone review yet. Lawmakers in most states may not consider upgrading the legislation a priority.

Besides, some sections of the law are rigid in nature.

Is Online Gambling Legal – Take Away

Gambling, offline and otherwise, has always had negative connotations in various circles. Different states have laws touching on betting, but most of them are not explicit about online gambling.

Other jurisdictions have permitted online betting and players wouldn’t face charges for any involvement.

More betting sites like Happyluke are opening up, and although licensed outside the United States, they allow players from the country to place bets. Payment processing companies are also on the increase.

This is probably because the betting industry is expected to grow despite the gray areas in the interpretation of the law.

It’s in your best interest to find out the answer to the question “is online gambling legal” in your state before investing your money there. Although it’s highly unlikely that you’ll earn a penalty, it’s good always to be knowledgeable in matters law.

Hopefully, more states will open up and put in place laws in favor of online gambling. For the time being, you can enjoy the sport in Delaware, Nevada, and New Jersey without restrictions.

If you are into gambling, here are tips for keeping the odds in your favor.

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