The Ashes

Technology, Science and other news
February 24, 2012

DoJ – New Stance May Change Outlook for US Online Gambling

Posted by : admin
Filed under : General

Until very recently the US Department of Justice (DoJ) took a hard-line stance on all forms of online financial transactions with regards to Internet gambling and related activities. In their own words mere weeks ago “ALL forms of internet gambling throughout the USA” were considered to be illegal. However, a recently published legal position seems to change this entirely. It appears that the DoJ stance has turned an ‘about-face’!

So far the position they have taken is only in relationship to the Interstate Wire Act of 1961 and the purchase of online lottery tickets in New York and Illinois. The Wire Act of 1961 is irrevocably linked to the Unlawful Internet Gambling Act, or UIGEA as we know it.

UIGEA and the Interstate Wire Act comprise the Federal Laws which have to date caused complications with getting online gambling, and in particular online poker, legalized in the USA.  The 13-page DoJ document which was dated September 20th, 2011, and is their new interpretation on the Acts; basically tells us that in the correct interpretation of the law, only sports betting is prohibited across state lines. The Wire Act was the law cited by the DOJ in its indictments against online poker sites and their operating principals, during the events of Black Friday (April 15th, 2011).

What is very strange at this point is the fact that Nevada has made huge strides towards legalizing and regulating online gambling; but the legal stance particularly makes mention of New York and Illinois, and there is reason for this. The legal position was requested specifically for these areas in response to online lottery ticket sales, and not necessarily any other form of online gambling in any other state. There is absolutely no mention made of any other form of online gambling. However, some attorneys believe it is a ‘significant’ decision, which without violating the Wire Act, will allow this and other states to legalize online gambling of various different types, without DoJ interference.

The belief is that US States can move forward to legalize online gaming within their own borders, which has been a concern even for Nevada, in other words, a door has been cracked open on the law. What it could also mean is that the Black Friday indicted would not be able to be implicated using UIGEA.

As an interesting aside, Brent Beckley of Absolute Poker has recently become the first to enter a ‘guilty’ plea on charges of conspiracy to commit fraud, relevant to Black Friday. He could face up to 18 months in jail if found guilty!

Professor I. Nelson Rose, who is a Gambling Consultant in the USA, has told members of the press that this new position might conceivably lead online poker operators in the US to having their rooms open to an international audience. The American Gaming Association, has said that it ‘validates the urgent need for Congress to act’ in terms of Federal legislation.

We are obviously going to be seeing more legal opinions on the matter in the forthcoming weeks.

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