Among the various forms of gambling, online gambling has emerged as one of the most popular. As of 2015, the worldwide gross win of gambling reached $400 billion. Gambling is also an entertainment activity, with many sites offering virtual poker, sports betting and casinos. In fact, more than a third of the total gambling market comes from online casinos.
The legality of online gambling has been debated on both a state and federal level. Some state officials are concerned that the internet might be used to illegally transport illegal gambling across state lines. Others are skeptical of the commercial nature of the business. But whether or not the law is on the books, the presence of an interstate element frustrates enforcement policies of both state and federal law.
The first major milestone in online gambling was the introduction of multiplayer online gambling in 1999. Since then, online gaming has continued to grow. In 2001, 8 million people participated in online gambling. By 2008, the revenues amounted to more than $21 billion. Aside from casinos, online gambling includes bingo, lotteries and sports betting. Online casinos are the largest contributors to the revenue growth.
Aside from being a fun and engaging hobby, gambling also plays a large role in the economy. For example, casinos and other forms of gambling generate millions of dollars in taxes each year, while tens of thousands of jobs are generated. However, as with most other industries, illegal gambling is still a problem. There are several federal laws, including the Wire Act, that criminalize the illegal gambling of sporting events. This is because betting on these events is considered a game of chance, and the winner is determined by the outcome of the event, not the skill of the bettor.
The UIGEA, or Unlawful Internet Gambling Enforcement Act, is a piece of legislation designed to prevent the use of financial instruments to make and receive illegal Internet bets. The act prohibits companies from accepting money from bettors who place illegal wagers. On the other hand, this statute does not ban online poker or any other form of online gambling. It does, however, contain a number of factors to weed out the low-level gambling cases.
As to the aforementioned UIGEA, there are two major reasons why the law hasn’t been slapped on any of the larger players. First, it would impede competition. Second, the law has been challenged on constitutional grounds. Specifically, the First Amendment has been raised as a counterexample to the law’s enforcement. While the Constitution does not require that all laws be upheld at all times, it does encumber free speech objections.
Other than its regulatory role, the UIGEA has raised questions about the scope of the federal government’s power to regulate interstate commerce. For example, the Federal Communications Commission has the power to halt or suspend the leasing and maintenance of facilities.
The most important thing to note here is that the most important laws regulating online gambling are primarily state-based. If a case is brought against one of these businesses, it is likely that the federal government will rein them in.