Gambling Laws and Regulations in the United States
Gambling has long been apart of the American culture, but unlike some countries like the United Kingdom, it is not something that is publicly discussed and accepted. For some reason, even though there are billions of dollars being gambled by U.S. residents, the government has had a very conservative stance on the subject. The introduction of online gambling opened the eyes of the public to how much money was being spent betting on a wide range of games, but it only caused the government to reiterate its stance while sticking its head in the sand.
Here’s the good news – it seems as though the U.S. is now headed in the right direction when it comes to allowing the public to safely bet in a regulated environment. However, we are a long way for widespread legislation, so this page is meant to give you a constantly updated hub for all the current activity. Here’s what we are going to cover:
- Current U.S. Gambling climate
- Main pieces of legislation
- Interactive Map of U.S. Gambling legislation
- State-by-state updates
What Is The Status On Gambling Currently?
This is a question that can take on a life of its own and needs many pages devoted to a thorough answer. We are going to break down what is happening on a state by state basis, but for the more general purposes of this answer, let’s summarize a few main points.
- There are billions of dollars being bet in the “black market” in the U.S. – between backroom bookies and offshore sites, this number, while impossible to accurately report, is definitely into the nine-figure mark
- Black market operators do not pay taxes – these aren’t folks reporting their income to the IRS< that’s for sure.
- Sports betting was legal only in Nevada until May 2018 – more on that to follow
- Online gambling continues to be “illegal” in almost every state – not for players, but for operators.
- The future, while bright, is very cloudy still – this is a moving target and will be for years to come.
So, what does all this mean? Well, it means that there are many ways for gamblers to access games, both legally and illegally. There are many issues with playing at offshore gambling sites, but until the laws are changed, and there are regulated, competitive options available to Americans, these sites will continue to thrive.
Gambling Laws That Have Affected The Industry In The U.S.
If we are going to talk about the future of gambling in the U.S., we need first to help you understand how we got to where we are today. One thing to keep in your mind is that the individual States have long been in charge of regulating their own gaming industry – lotteries and casinos are managed at the state level – with some overarching federal legislation that has definitely had an impact. Here are some of the more important ones you should be aware of in comprehending the current state of affairs.
The Wire Act
The Wire Act was written in 1961 as a way to curb certain betting business taking place in the United States. The law states that it is illegal for anyone to make or take wager over a wired form of communications. Now, when it was written, the Internet didn’t exist, and this opened the door for many offshore sites to begin taking business. There have been several challenges to the Wire Act, and a Court of Appeals maintained that it was written for sports betting and does not apply to other forms of online gambling. Still, the Wire Act remains one of the biggest deterrents to online betting in the United States.
When online poker became so popular in the early 2000s, the U.S. government felt it had to take action. Unlike sports betting or online casinos, both of which had more of a seedy stigma attached to them, poker had become the darling of the world. Sports networks like ESPN broadcast hours of coverage a week, and the public fell in love with the idea of a game where amateurs and pros could co-exist.
Ultimately, with these offshore poker sites becoming valued into the billions of dollars, the U.S. too measures to curtail the growth of the business without killing it off altogether. The Unlawful Internet Gaming Enforcement Act was passed into law in 2006, making it illegal for U.S. banks to process gambling transactions for unregulated gaming activities. This sent shockwaves through the industry, forcing most of the companies accepting bets out of the U.S. and leaving only companies that were privately held. While this helped for some time, the offshore sites continued to take business until April 2011, when the Department of Justice seized the websites of the three major players in the online poker market.
Until recently, many people may have wondered why sports betting was only available to Americans who visited the state of Nevada. Well, with the rise of sports betting in the U.S. in a black-market environment came the potential for serious corruption. The government, rather than find ways to protect the sanctity of sports in a safe, legal environment, instead introduces the Professional and Amateur Sports Protection Act in 1992. This prohibited legal sports betting in any state except Nevada, which had been grandfathered in as they had already been taking bets in Las Vegas casinos for years.
Recently, the state of New Jersey decided they wanted to cash in on sports betting, and they passed legislation to make it legal in their state. The professional leagues challenged this legislation, and for a couple of years, they fought it in court. The fight made it all the way to the Supreme Court, and amazingly the justices decided to review the case. In May 2018 the SCOTUS returned a landmark ruling, deeming PASPA as unconstitutional and in violation of state’s rights. With that decision, PASPA was overturned, and sports betting was no longer illegal. The floodgates have been opened, and many states are already taking or planning to take sports bets in some form by the end of 2018.
Nevada was one of the first states to regulate online gambling, which is not surprising given how much casinos are a part of its landscape. This page details how Nevada was a trailblazer in this area, including all the hits and misses that come from being the first to take the leap.
Aside from fighting to allow legal sports betting in its state, New Jersey has also been on the front lines when it comes to legal online gambling. There are currently legal poker and casino options in the state, and despite the slow start, the numbers indicate that the desire to gamble in a regulated environment exists, and it’s up to the state to figure out how best to manage the offshore competition.
The state of Pennsylvania watched the launch of online gaming in neighboring New Jersey very intently, and in turn, has passed its own set of online gaming regulations for their state. With the application process having recently begun, we aren’t yet certain where this legislation will land, but we have already seen some confusion and complaints about the process as a whole.
Delaware is a very small state, and yet it wants to have its hand in the online gambling and sports betting business. Due to its size, it is easy for the state government to pass these laws quickly, which has resulted in Delaware stealing some press thunder when it comes to moving into regulated spaces.
Suffice it to say that the current status of online gambling in the United States is confusing. We are doing our best to keep you updated on all the activity, so if you are looking to find out what is going on in your state, then your best bet is to bookmark this page and check it out often.
Frequently Asked Questions
Is it illegal for me to play at an offshore site?
Currently, it is technically not illegal for Americans to play at these sites. However, getting your money to and from the sites is increasingly more difficult and expensive, and there are far fewer options than ever before. It is highly unlikely that the government will make it illegal for you to access these offshores sites, but we always you exercise caution when using any illegal site.
How come I can still use my credit card online?
Even though the UIGEA legislation made it illegal for U.S. banks to process these gambling transactions, the industry was quick to respond with ways to circumvent the regulations. Payment processing companies from outside the U.S. popped up with creative ways to confuse the banks, and to date, it has been too much work to enforce properly. For the time being, your card may still work but at any time that could end.
Is there a chance sports betting won’t be legal now?
There is always a chance of it happening, yes. The professional leagues have not given up their fight, although it is more likely they will just move to work in partnership with state governments to protect their sports. Ultimately, the leagues would like a cut of the action somehow now that it is going to be legal.
Why isn’t my state doing anything yet
Each state has their own agenda when it comes to online gaming regulations. Some are moving forward with bills, while it still isn’t on the radar for others. This process is going to take some time, but if you want to help push things in your state, then you should reach out to your local congressperson and see what can be done. If there is a groundswell of interest from the public, it may push the topic higher up the list at the government level.