The Legality of Online Gambling
Despite the positive benefits of online gambling, there are still risks. For example, gambling addiction can result in financial ruin. Additionally, some banks will not process online gambling transactions in certain countries.
There are a number of federal criminal statutes that are implicated in illegal Internet gambling. These laws cover a wide range of crimes, from laundering for international purposes, to law enforcement stings. In addition, there is limited First Amendment protection for crime facilitating speech. These statutes also impose penalties on owners of unlawful gambling businesses.
In 2011, the Department of Justice allowed states to pass legislation regulating online gambling. As a result, twenty states allow residents to wager on poker sites and sports events through the Internet. The US Supreme Court has ruled that sports betting is legal in the United States. However, the Wire Act of 1961, which was drawn up before the Internet was a widely used medium, does not apply to digital wagering.
One of the most important issues in enforcing the law has been whether Congress has the authority to regulate gambling on the Internet. The Commerce Clause has been a source of controversy. Some argue that the commercial nature of the gambling business allows it to satisfy the clause. Other arguments have been raised about the free speech guarantee of the First Amendment. These attacks have so far had little success.
A recent case that dealt with the Commerce Clause is United States v. K23 Group Financial Services. The case involved Internet poker operators. The Government charged the operators with violating 18 U.S.C. 1955, which prohibits making unlawful financial transactions. In addition, the operators were accused of UIGEA violations.