The Federal Government’s Role in Online Gambling

Online Gambling

Regardless of which state you live in, it is illegal to operate an online gambling website. The following federal criminal statutes are implicated in illegal Internet gambling: The Wire Act, the Illegal Gambling Business Act, and the Travel Act.

The Wire Act prohibits gambling on sporting events, contests, and other activities that take place outside of state lines. It is also prohibited to accept financial instruments from a person illegally gambling on the Internet.

Section 1956 of the Unlawful Internet Gambling Enforcement Act (UIGEA) prohibits money laundering for illicit activity. It defines laundering as the concealment of a substance or product by a person who intends to promote or facilitate illicit activity. The statute also prohibits laundering money from illegal gambling to evade taxes.

The law is also applied to bartenders and managers of establishments that have video poker machines. A bartender who facilitated the sale of illegal gambling could face up to five years in prison.

The Unlawful Internet Gambling Enforcement Act (UIGEA) is part of the larger federal statute, the Illegal Gambling Business Act (IGBA). IGBA prohibits the operation of a gambling business unless five or more persons own, manage, or direct the business. The owner must also have gross revenue of at least $2,000 per day.

The Federal Communications Commission also has jurisdiction over common carriers. The FCC can shut down facilities, discontinue furnishing, and suspend or terminate leasing. It can also prohibit the use of certain telecommunications services.