While the online gambling scene in the US has changed quite significantly in the recent years, there are certain problems that prevent things from going to the next level and the Wire Act is certainly one of the major factors.
Initially created to prevent sports betting activities using telephones, the Act now stands in a way of online gambling becoming accepted in many US states. Here, we're going to discuss what the act is, and whether it affects your state.
Its main purpose was to prevent sports betting using telephones
The DOJ is asserting the Act relates to all form of online gambling
Regulated states can’t accept players from another state due to the Wire Act
What Is the Wire Act?
Back in the 1950s and the 1960s, unregulated sports betting became a large target for the law enforcement agencies. They were looking to put a stop to it but it was hard to do without required laws and legislations to address the issue. An answer to the problem was represented in the Wire Act of 1961, a regulation that advised against using a “wire communication facility” (i.e. a phone) to transmit information across the state lines to place bets or wagers on any sporting events or contests.
This measure served the purpose at the time as it gave government agencies the required ammunition to go after individuals and organizations that set up large betting operations, accepting wagers from players all over the US using phone communication. It was one of the first steps towards putting an end on illicit sports wagering albeit numbers show that all these laws and restrictions didn’t do much to actually prevent people from betting on sports.
Not surprisingly, the Wire Act doesn’t address online gambling as it was passed several decades before the emergence of online casino sites. However, in the past several years, the US Department of Justice (DOJ) has issued its Wire Act opinion on several occasions, and the most recent one looks to include all forms of online gambling under the Act’s umbrella.
As mentioned, the Wire Act was passed in the period where online gambling as such was decades away from becoming a reality. Thus, the Act doesn’t mention it or any related activities. The Act was passed with a very specific problem in mind and because of this, its wording is such that it effectively addresses a fairly narrow scope of activities.
Recently, however, the DOJ has been rather adamant to get the Wire Act and online gambling in a close connection, declaring its wording, while not the best in all of its parts, clearly addresses other forms of gambling activities and, as such, should apply to online gambling in general.
Of course, this is an opinion that many states don’t agree with, especially the ones that have regulated online gambling for those above the legal gambling age. Applying the regulation to all gambling activities would significantly hinder their efforts and could strike a significant blow to their profits, especially for those with interstate compacts that provide decent revenues from tax on online casino winnings.
The Department of Justice doesn’t have the final say in the matter, however. In the end, it will be down to the Supreme Court to make the definitive ruling and establish if the Wire Act scope should be extended to cover all online casino games or if it, as it stands, only pertains to sports betting.
Wire Act as an Obstacle to Interstate Gambling
While the jury is still out on the exact scope of the Wire Act, it is quite clear it prevents transmission of certain types of information across state lines. This means that regulated states can’t simply establish a site where they would openly accept players from other states. This is a federal act, which means it supersedes any state-level laws and states don’t want to go against it.
Some states have entered interstate compacts, allowing them to offer services to all players within the compact. However, if the DOJ is successful in their plans and their latest Wire Act opinion is upheld, these compacts would have to be terminated.
It is important to note that back in 2011, the DOJ actually presented an interpretation where the Wire Act can only be applied to sports betting, asserting it doesn’t address other forms of online gambling. This is the interpretation that regulated states, such as Nevada, Delaware, and New Jersey relied upon when setting up their casinos and entering the said interstate compacts.
Of course, these compacts were only made between states that had passed their own online gambling laws. In the current climate, it would be impossible for a state to open the doors of its virtual casinos to players from all over the US and this isn’t likely to change unless there are some important changes on the federal level.
Is Online Gambling Legal in Your State?
Navigating the world of US online betting can be tricky at the best of times, which is why we've created a handy interactive map which shows the legal status of every state in the USA.
There aren’t very many things that could be described as clear and easy to understand when it comes to online gambling in the States. With so many different laws and regulations on different levels, it is hard to say what the future holds. Many players would love nothing more than to have one federal law that defines all online gambling activities.
At the same time, it is more than clear that there is a very strong anti-gambling lobby working behind the scenes. It consists of people who are genuinely against gambling but it is also heavily supported by land-based gambling magnates, who see regulated online gambling as a threat to their businesses and will do whatever they can to prevent it from happening on a large scale.
In this climate, the Wire Act of 1961 is a powerful weapon that can be used as a tool to delay any type of federal regulation and hinder states’ efforts to create an online network of casinos and other gaming sites (poker, sports betting) that would cater to players from multiple states at the same time.
While locally licensed casinos do represent a threat to some extent, as long as they are kept within state borders, they simply can’t grow in a way that other international gambling sites can. So, those working against online gambling will pull all the stunts they can to slow things down as much as possible and, if possible, completely undermine the idea of internet gambling.
There are too many factors up in the air right now to say with any degree of certainty what the future holds in this regard. We’ve seen many positive movements in the online gambling scene in the United States so we can hope that things will keep moving forward and that more and more players will have the freedom to practice bankroll and money management in online casinos across the country.
At the same time, if the DOJ is given free rein to do what they want, they could cause some serious damage and significantly hinder all the efforts that have been made so far. If they start acting upon their interpretation of the Wire Act, a number of states will find themselves in a very unpleasant position. While it is hard to believe something like this would ever be allowed, we’ve seen stranger things happen over the years and go down without too much resistance. While fans of online gambling certainly wouldn’t enjoy this type of development, it is, sadly, not that far-fetched.
Options Are Limited – But They Exist
So, to sum things up, there are many reasons why you aren’t allowed to play at an online casino located in a different state. The Wire Act is one of the main factors in play here and it will be interesting to see what will happen moving forward. In the meantime, however, you can still check out our comparison of regulated state casinos to see if there is one you can play at. We make sure to keep our list fresh and up to date so you can rest assured that if there is an option for you, you will find it here!
Looking Forward to the Future
While you may not be able to play at an online casino from a different state right now, things might change in the future. Some states have already created interstate compacts and others are looking to do the same. The Wire Act and the DOJ may slow things down and there may be some legal battles in the future so it is important to be patient. Things are finally looking up for the online gambling in the US and we are confident they will continue to develop in the right direction.
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