Online Gambling Laws and Constitutional Challenges
Whether you’re in a state that allows online gambling or not, the Internet is a hotbed for legal and illegal Internet gambling. It has become a focal point for lawmakers and state officials who worry about the potential for Internet gambling to bring illegal activities into their jurisdictions. It’s also been a subject of constitutional challenges. Those challenges have ranged from attacks on the Commerce Clause to claims that gambling is a First Amendment right. In the case of the Commerce Clause, opponents have argued that gambling activities are commercial in nature and therefore should not be regulated by state law.
On the other hand, the First Amendment’s guarantee of free speech has been a topic of contention in legal and constitutional challenges to federal gambling laws. For instance, does the Commerce Clause give lawmakers the power to regulate the Internet for the purpose of criminalizing gambling? If the answer is no, does the First Amendment’s guarantee of free speech encumber free speech objections to prosecution for gambling activity? These are all good questions.
The first legal online gambling venue was the Liechtenstein International Lottery. The second was the WSOP in Michigan. Other gambling sites include BetMGM and PokerStars. Other sites have been tacked onto expansions. Some states, like Illinois, have passed laws that make sports betting legal. However, in most states, illegal gambling on the Internet is illegal under the Wire Act and the Illegal Gambling Business Act. In addition, the Federal Communications Commission has jurisdiction over common carriers and may take steps to prohibit leasing or providing facilities for Internet gambling.
While it is legal to place and receive bets on sports games and other events in Illinois, residents cannot place or receive wagers on in-state college games. As of 2022, the IL sportsbook registration requirement will be sunset. However, Illinois might legalize online casinos in 2023. It is also possible that Indiana will do the same.
It’s difficult to say how many states will pass laws to regulate online gambling in the future. It’s likely that the law will be used to weed out small-time gambling operations, as was the case with the Lopez Amendment. The statute includes elements to weed out low-level gambling cases and comes with Congressional findings on the impact of the law on interstate commerce.
Other statutes that could prove to be relevant to Internet gambling are the Travel Act and the Wire Act. The Travel Act bans illegal gambling on the Internet and prohibits the promotion of unlawful gambling. It also provides that federal authorities may take action against a person who facilitates the distribution of gambling proceeds. It also provides that owners of illegal gambling businesses can be fined and imprisoned for up to five years. The Wire Act prohibits illegal gambling on contests and sporting events.
The Unlawful Internet Gambling Enforcement Act, or UIGEA, is also a federal criminal statute that prohibits Internet gambling businesses from taking or accepting payments for illegal Internet gambling. The statute also includes provisions for age verification and appropriate data security standards.
