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The History of Online Gambling Laws

If you follow the news, especially the business perpetrated by the Congress, you surely realize that this is a historic time for online gambling. A couple of moth ago, US elected officials decided to pass a bill, the Unlawful Internet Gambling Enforcement Act (UIEGA), which could essentially render Internet gaming impossible. However, gambling was already illegal in the technical sense prior to this decision by virtue of the 1961 Wire Act. But online gambling has continued in the US, and more and more people are drawn to Internet poker and online casino games.

At a moment like this, it is probably a good idea to take a look back and try to determine how we arrived at this juncture. A number of previous legislative moves and judicial rulings have been responsible for our tortured state of affairs.

It is true that some states have specific laws against online gambling of any kind. The Internet Gambling Prohibition Act of 1997 was passed by the U.S. Senate on July 23, 1998, by a vote of 90-10. However, it was not approved by the House of Representatives, thanks to some serious lobbying which allowed for cooler heads to prevail.

In March 2003, the whole mess started up again. Deputy Assistant Attorney General John G. Malcolm testified before the Senate Banking Committee regarding the special problems presented by online casinos and internet poker. He claimed (wildly overstating the case in my opinion) that the anonymity of the Internet makes it especially difficult to trace potential online money laundering transactions.

In April 2004 Google and Yahoo announced that they were taking down all online gambling advertising from their sites. At the time, some wiseacre in the Department of Justice claimed online gambling was a contradiction of the Appeals Court ruling, the Wire Act relating to telephone betting applies to all forms of internet casino gambling and that any advertising of such gambling could be deemed as aiding and abetting. I was leading the charge of critics at the time who said there is no legal basis for pressuring companies to remove advertisements since they are protected by the First Amendment.

In February 2005 the North Dakota House of Representatives passed a bill to legalize and regulate online poker and online casino operators in the state. Obviously, regulation is the way to go. Just look at how well it's worked in the U.K. Click here to find more information about European gambling laws.