The New US Gambling Laws: What Does It All Mean?

t the end of September 2006 the U.S. Senate introduced “The Unlawful Internet Gambling Enforcement Act 2006”. It wasn’t so much introduced as pushed through at the back end of the “Safe Port Act”, to which some commentators have taken exception. This has caused a flurry of anxiety and (some would say) hysteria among players, website owners and online gambling affiliates alike. But what does the new law actually mean? This article has a look at the facts behind the new legislation.

The first clue is in the wording of the Act itself; it is an enforcement Act. In other words it enforces previous and existing law where legality of gaming has already been established as a matter of precedent, and also the legality and illegality of different types of gaming already existing.

I could do much worse than directly quoting the wise words from Cardplayers legal counsel. He writes that the new bill

“attempts to make it more difficult to get money into a site by forbidding US financial Institutions from funding the type of online gambling that the law has previously made illegal. The new bill does not make online gaming illegal where it was not illegal before …The bill merely speaks to the mechanism by which an online account is funded.”

In other words the Act attempts to hinder Internet gambling sites by starving them of funds, by ordering the banks not to allow players to use their credit cards to play at those sites.

There is nothing about the activity itself being illegal (where it was not illegal before). And clearly, if the gambling sites in question are offshore, then by definition they are not subject to US legislation anyway. So the only way to get at these offshore sites is through the banks and the credit card companies.

The article I quote from goes on to cite the significance of the 1961 Wire Act, which was construed to have made sports betting illegal, but not games such as poker, on the grounds that the law was never enforced with regards to poker in the ten years that Internet gambling has existed. Instead, the 33 cases which were brought under the Wire Act were pursued by “deadbeat gamblers” who simply did not want to pay their gambling debts. The judge on that particular occasion, Stanwood R. Duvall Jr, threw out all 33 suits, so ruling that online poker was not within the reach of the Wire Act’s prohibition.

Now while the lawyers are busying themselves on working out the construction of what the new law actually means, it seems that players can make a few simple choices in order to protect themselves from what might be construed:

1. Open an account at an offshore Internet casino website;

2. Ensure the site is registered with a non-US company;

3. Ensure the site is hosted by a non-US company.

The vast majority of offshore Internet gambling sites still operate in US dollars, and they increasingly offer multiple currency choices. You can select which currency you wish to use before you play. Even so, it may be worthwhile remembering that, at the time of writing, there are approximately $1.87 to the Pound Sterling, and $1.26 to the Euro.

If the law goes further it may well be necessary to apply for a credit card issued by a non-US bank. But this is still something that is subject to speculation. We will have to see how the new law pans out in practice. In particular we will have to await the matter of how the law is construed and how precedent impacts upon it.

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