Is online gambling legal in the U.S.?

There is no U.S. federal law against gambling online

There is no U.S. federal law against gaming online. At the national level, gambling on the internet is perfectly legal, because of the lack of a law against it. It’s possible to run afoul of state law (especially in extremely conservative countries ), but even there prosecution is extremely rare, and penalties are often minor.
U.S. Attorney Catherine Hanaway admitted in a House hearing that just placing wagers online doesn’t violate federal law. No American has ever been arrested, indicted, or prosecuted by the feds for gambling online, since there’s no law against it. If online gambling were illegal I would not be running his website for nineteen years, as an American citizen, living in the U.S., using my real name. And I occasionally gamble online, too, and I acknowledge that publicly, like I’m doing at this time.
This may be confusing as the other outlets erroneously reported that Congress prohibited online gaming in 2006. Those reports are just erroneous. The 2006 law makes it illegal for banks to move betting money once the stakes are already prohibited (like from a state law), but does not make it illegal for players to create bets. The law simply does not create or expand any ban on gaming itself. In reality, the law says quite clearly,”No provision of this subchapter shall be construed as altering, limiting, or extending any Federal or State law or Tribal-State compact prohibiting, allowing, or regulating gaming within the USA.” You can see for yourself by checking out the full text of the law.
While you do not break any national laws from placing bets online, it’s not legal to conduct a gaming operation (i.e., to take bets), but in those few states where it is explicitly legal and the operator is accredited. So don’t think that you can start an online casino or run Facebook raffles.
And yes, the FBI posted a scary warning online in which they claimed that putting bets on the internet is against the law. In short, they whined, and the DoJ finally reversed that place anyway. (more on that)
States where online gambling is explicitly legal
Very few states have specific laws against online gambling, though many have laws against gaming generally, which apply equally to online and offline gambling. A little handful of countries have legalized online gaming, provided that you play one of the handful of approved online casinos. In some states, only certain kinds of gaming may be legal (e.g., poker). The states which have legalized some form of online gambling are:
Delaware became the first state to legalize online gambling, in June 2012, and the third to start (Nov. 26, 2013). (USA Today, Delaware Online, Casino.org)
Nevada became the first nation to legalize online gaming (well, poker ), on Feb. 21, 2013 (CBS) and launch on April 30. (LVRJ)
New Jersey became the third country to legalize online gaming (poker + casino), signed into law in February 2013, and launch on Nov. 25th. (NJ Poker Online)
Note that Bovada will not accept players from these states, nor will they accept players out of Maryland or New York.
The District of Colmbia became the first jurisdiction to legalize online gambling in the U.S., in April 2011. However, the measure was repealed in February 2012 before it ever became active. (NY Times)
State offenses of gaming are often misdemeanors
Even if countries do not allow players to gamble, the penalties are almost always mild. The only states where easy gaming is a felony are the two Washingtons: Washington, DC, and Washington state. (source) In many nations simple gambling is merely a misdemeanor, and in Arkansas and Colorado it’s a simple petty crime, like a traffic ticket. (origin )
States with an online gambling prohibition
Even countries that prohibit gambling in general usually do not have a specific ban on online gaming. If it’s against the law to bet on your state, that applies offline and online, even if the law doesn’t mention online. However, a couple of countries do specifically outlaw online gaming. Those countries are:
Illinois
Indiana
Louisiana
Montana
Nevada (go figure)
Oregon
South Dakota
Washington
Wisconsin
Source: Gambling Law U.S.
Players convicted of violating State laws I know of only two cases in which a participant ran afoul of state laws (in exceptionally conservative states), both of whom were billed under their nation’s general anti-gambling laws, no special anti-online-gambling law:
North Dakota. Jeffrey Trauman paid a $500 fine on what was probably over $100,000 in online sports bet winnings, in 2003. (Betting & the Law)
Oklahoma. Online sports bettor Roland Benavides was charged in 2011 and in 2012 received a deferred sentence (meaning that if he does not violate the conditions of his probation, he’ll probably face no jail time). (News OK)
Kentucky seized domains A Kentucky judge agreed to let Kentucky capture 141 gambling-related domain names, on the spurious grounds that a domain name comprised a”gambling device” under state law. But even if it had been clear that gaming domains violated Kentucky law, the seizure was nevertheless ridiculous, because by that logic any country could grab any domain anywhere in the world when the site happened to violate its local law. In any case, as FlushDraw said,”Just a few of US-based registrars complied, and the seizures themselves were rendered somewhat moot when nearly all of the domains relocated to non-US registrar services and stopped using”.com” domains.”
The Kentucky Court of Appeals promptly chased the seizure action, but then the State appealed. I couldn’t find any upgrades between 2014-2018 (EFF 2008, KY appealed in 2009, 2014 judgment )
Taking bets is illegal It has always been contrary to national law to take sports bets over the Internet (not to make them). That is, you can not set up a website and take sports bets from the public. The legislation which prohibits this is called the Wire Act. For many years the feds stated that the Wire Act applied to taking poker and casino bets also. Then in 2011 they reversed themselves and stated the Wire Act applied only to athletics. (Forbes) Subsequently in 2019 they reversed themselves again and returned to the former position that the Wire Act indeed applies to taking casino and poker stakes as well. (source) Though again, placing bets remains perfectly legal under national law. The challenge is finding a reputable place to play. Due to the legal problems, there aren’t many operators operating the whole U.S., and several of those that are kind of sketchy. That is why I advertise only Bovada on this website, because they’re the best one for U.S. players.
States can now offer sports betting In May 2018, the Supreme Court overturned a law that prohibited sports gambling in all countries but Nevada. This permits individual countries to legalize sports gambling if they choose to do so. However, the court’s ruling doesn’t speak to the Wire Act, so online sportsbooks still violate federal law (for the operator, not the participant ). (Forbes)

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