Is there something illegal for players from the U.S. to play at an online casino?

In general, there is no Federal law against gambling in online casinos. Since 2006, almost every US Attorney has discussed the issue in the Senate, House of Representatives or the Court of Law. However, Federal authorities are still undecided on how to tackle this controversial issue. It is precisely due to vague rules that no one has ever been prosecuted for online gambling as US courts are unable to refer to an existing clause that can help solve the riddle. In fact, there are several online gambling casinos run by US citizens residing in the United States where the owner of these casinos continue to use their real names. To understand existing laws pertaining to US citizens, it is important to summarize key findings, which are described below:

  1. As of 2015, the US Federal law doesn’t prohibit online gambling because lack of existing clause makes it difficult for prosecutors to charge an individual. Even if there are laws, such laws do not represent comprehensive rulings. Accordingly, most of these rules are implemented on local level making it acutely difficult to charge anyone in the United States because the sphere of online gambling is not limited to any specific local jurisdiction.
  2. As described in the previous paragraph, the extent of online gambling laws is restricted to local level. Since the start of Millennium, there are only two reported incidents where individuals are charged against online gambling. As such, the nature of these charges was based on regional clause making them mostly ineffective against individuals. Perhaps, one of the most popular anti-gambling charges was brought against a North Dakota resident, Jeffery Trauman, who paid $500 fine. Interestingly, Federal authorities only became aware of Jeffery when he reported to have won over $100,000 in online sport betting. In fact, these charges were ineffective as Jeffery was charged on anti-gambling rules instead of online gambling laws. In 2013, another major ruling was passed by Oklahoma against a well-known online better, Ronald Benavides. As a result, Ronald was given a deferred sentence, which meant that the person will not serve any jail-time if he doesn’t engage in online gambling activity during the time of his probation. Regarding these local rulings, it must be understood that Ronald is free to engage in online gambling in other states except Oklahoma because rules for online gambling differ widely in each locality.
  3. Problems associated with online betting originated from a Wire Act that prohibited individuals to place sports betting in online casinos. Due to the lack of rulings on online betting, Federal authorities mistook Wire Act as rules against online gambling for Poker and casino bets. In 2011, US Department of Justice finally clarified Wire Act as rules pertaining to online sports betting instead of poker and casino bets. Most legal observers agree that the ruling paved way for individuals to engage in legal online betting in the United States.
  4. To combat frauds in online casino industry, US authorities restricted banks to engage in online transactions related to the gambling industry. As a result, US banks are forced to avoid gambling transactions. In reality, it is theoretically impossible for banks to keep a constant eye on every transaction made by an individual, which makes it acutely difficult for banks to restrict such dealings. Subsequently, it is also worth mentioning that there is no rule stopping individuals to carry online gambling transactions, which means that US citizens can place legal online bids using their US credit profile.
  5. There is also a widespread debate on placing gambling ads in newspapers, online websites and other media. Recently, several laws were passed against large publishing house like Google, Sports News and Yahoo preventing them to display gambling ads on their websites. Despite these decisions, most experts suggest that these laws are mostly ineffective because it did little to stop advertisers from placing such ads in prominent locations on the Internet. For instance, Sports News only paid fine equaling profits generated from these ads. On the other hand, Google paid only one-third of its daily profits as a penalty. Still, some other major websites like Yahoo and Microsoft got away with fine. In the long-run, it seems that charges against these powerhouses will do little to stem the flow of online advertising ads because several other major publishers did not face prosecution. It seems that medium-sized and small publishers continue to run such advertisements evident from thousands of ad impressions displayed on the Internet on daily basis.

Despite these explanations, readers may ask if it is safe to gamble online without confronting law. Technically, there is no Federal law in the United States that prevents US citizens from gambling online. As described above, it is challenging for prosecutors to show that a website or an individual is harming the constitutional rights of US citizens. Hence, it is difficult and expansive for prosecutors to pass judgements on individuals and online websites. Perhaps, the only way that prosecutors and Federal authorities can prevent online gambling fraud is to stop banks and other institutions to take part in the activity. As a result, on-going efforts of Federal authorities are mainly directed towards US Banks and institutions. By doing so, Federal authorities can tackle gamblers who engage in fraudulent transactions. It also means that laws pertaining to online gambling in casinos outside US jurisdiction are even weaker.

We must understand that the Federal law doesn’t restrict US citizens from online gambling. In fact, the hype in media is due to on-going efforts of Federal authorities to prevent websites engaging in illegal activities that may include fraud and money-laundering. Hopefully, evolution of online gambling will likely provide advanced tools and regulations that can confront frauds making it easier for Federal authorities to pass laws in favor of online gamblers. Perhaps, integration of online casinos in the mainstream gambling industry is dependent on these advanced tools. As for now, it is more important for gamblers to ensure that they don’t engage in harmful activities instead of thinking about controversial laws.