Is Online Casino Gambling Legal In The Us

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While some states have legalised both land-based and online casino gambling, the majority of states have not. The land-based gambling sector is much more liberal than the online sector, as is often the case with gambling. As it actually stands, the US laws are exceptionally hazy when it comes to the subject of online gambling. See full list on worldatlas.com.

Thousands of Americans gamble online. But is online gambling legal? We break it down to show you what you can do, what you can't do, and what's still up in the air.

by Katherine Butler
updated September 03, 2020 · 2min read

The legality of online gambling is ever-changing. But one thing is constant: it makes a lot of money. Online gambling industry makes an estimated $1 billion dollars annually. This is a huge business, and a lot of people have cashed in on it. But it has led to some ambiguous legal issues, as the legality of online gambling is constantly being challenged.

There are differences in the legality of making bets, taking bets, facilitating payments to casinos, and advertising on websites. And there are constantly new legal challenges. So here is a breakdown of the law on online gambling.

Legal Forms of Gambling

There is no federal law against placing a wager online. So, you can legally place a bet online. However, a wager must not be placed on a site located in the United States. There is a small chance players might run afoul of state law, but there is little chance of prosecution. The only case cited where a person got into trouble with a state was in 2003. Jeffrey Trauman of North Dakota paid a $500 fine on over $100,000 of online sports bet winnings.

Sites that are set up outside of the United States are legal. Therefore, gambling on websites located in areas like Australia, the Caribbean, and Latin America is legal. Just be very clear that the site you are playing on is not based on U.S. soil.

Definitely Not Legal Forms of Gambling

It is never legal to gamble on a website based in the United States. Also, if you are planning to operate an online gambling site, stay outside of the United States. You must also deal only with casino and poker wagers (not sports bets) from people in the US. And you cannot take bets over the phone from people in the United States.

Accepting online gambling advertising is also illegal. If you are a small publisher, you are less likely to be prosecuted, but why risk it? As of early 2009, only large and mid-size publishers had faced prosecution. In 2007, the three big search engines (Google, Yahoo, and Microsoft) each paid a fine for accepting online gambling ads, but did not face criminal charges. Other publishers, such as Esquire Magazine, have been warned by the government not to take online gambling advertising.

Facilitating the transfer of funds to online casinos is also a bad idea. As of 2006, it became illegal for American banks to process transactions originating from or directed toward any online gambling operator. Because of this, several sites then refused to take bets from American players. But as the law seems difficult to enforce, it has not turned the tide completely for American players.

Still up in the Air

Advertisers who promote sports books in magazines and on billboards may or may not face prosecution. So far, sports books have never been scrutinized for advertising online. And online casinos, poker rooms, and sports books have never been prosecuted for buying ads.

Online casinos and operators still accept American players. And international financial parties have continued to process their transactions. The legality is always changing and there have been attempts to declare online wagering against the law, but for now, U.S. citizens who simply place bets online are in the clear.

Contents

As discussed in a previous article on the legality of playing blackjack online, the gambling industry in America is one of the most structured and developed gambling environments in the world. It is surprising then, that out of all countries in the world, the US probably has the most confusing situation when it comes to online casinos.

The majority of this confusion stems from the fact that online gambling is partly regulated by federal laws and partly by individual states. Moreover, since each state approaches the subject in a different manner, the average US player is left baffled when trying to decide whether using online casinos is legal in their state.

Current Federal US Laws That Regulate Online Casinos

Here’s a statement no one was expecting — no federal law in the US says that online gambling is illegal. However, it also doesn’t say that it is legal, which makes the market a gray area. US citizens are allowed to place wagers online, but only if the website isn’t based in the US.

The US federal law explicitly prohibits banks — or any other financial institution — to knowingly process transactions between a known web-based gambling business and US-based customers. In essence, it is illegal for your bank to handle a withdrawal or deposit to or from your casino account. That was the goal of the much-grumbled-about UIGEA (Unlawful Internet Gambling Enforcement Act).

Is online casino gambling legal in the us 2020

You should notice, however, that it isn’t a crime for a US-based player to make or request a transaction — it’s just illegal for the bank to process them.

When it comes to lawmaking, the Tenth Amendment of the US Constitution states that anything that doesn’t have a specifically granted Federal purview and jurisdiction is up to the states. Thus, the Federal Government has not taken any stance related to gambling taking place within individual states — it up to individual states to do that.

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The only two areas that the Federal Government regulates are:

  • Interstate Commerce

The consequences of the first were already explained. The latter resulted in allowing states such as New Jersey to have online casinos, but only if they are being offered to US citizens physically located within New Jersey’s boundaries.

Casino Laws by State

See Full List On Legalgambling.net

Current States’ Laws That Regulate Online Casinos

If federal law was all that US players had to consider, the legality of web gambling would be a lot easier to talk about. Unfortunately for US-based gamblers, US state law is sometimes more restrictive than federal law.

So how strict are US state laws on internet gambling? Some US states have laws that explicitly prohibit all forms of online gambling.

Those are:

  • Washington
  • Wisconsin
  • Illinois
  • Montana
  • Oregon
  • Louisiana
  • Utah
  • Hawaii

State law prohibits the residents of these states from placing any kind of bet over the internet, regardless of federal regulation. Other states are less strict but are still restrictive — in South Dakota, for example, anyone in “the gambling business” is not allowed to place online bets, which is a really quirky law if you think about it.

Long story short, some US players have to walk a thin line if they want to play in an online casino while remaining within the confines of the law. Thankfully, the US rarely prosecutes online gamblers. We only found two instances where an online gambler broke a law, and both come from politically conservative states.

States in Which Online Casinos Are Legal

Thankfully, several states are more liberal toward online gambling and allow online casinos to operate in their area.

New Jersey

The state of New Jersey doesn’t prohibit online casinos and online poker. It is currently the biggest market for regulated online gambling in the US. Over a dozen licensed and legal online casino websites and poker rooms compete for their place in the sun in a market that is worth over $255 million per year.

Pennsylvania

In PA, online casinos were launched in July 2019 and online poker in November 2019. Gamblers have the option to bet in person or online via mobile app or website. Many Pennsylvanian major land-based casinos have created their online casino versions too.

Delaware

In Delaware, online casinos and online poker were launched at the same time — in November 2013. Although the First State seems like a strange location for amazing web-based gambling, that’s exactly what it is.

Michigan

As of December 20, 2019, online casinos and online poker are legal in the state of Michigan. However, operators are limited to a single online skin, and multi-state games aren’t permitted. Each of the 23 tribal and three commercial casinos can apply for licensing, but online casinos are still waiting to be legalized.

Nevada

Even though it is an unofficial birthplace of American gambling, the state of Nevada only allows online poker in designated poker rooms. Yes, they do have a legal WSOP website, but other online casino games are prohibited.

Offshore Casinos — A Handy Alternative

Even if you aren’t physically located in the states where online casinos are legal, there is still a way to find some quality entertainment online — by playing in offshore casinos.

Any US citizen can legally access these licensed offshore gaming platforms from most states. As we already explained, in Washington, Wisconsin, Montana, Illinois, Utah, Hawaii, Oregon, and Louisiana, all forms of online gambling are explicitly forbidden.

If you are wondering whether it is safe to play in casinos that aren’t licensed in the United States, the answer is yes. These casinos are legitimate and have clearly defined guidelines and rules that ensure a safe and fair gaming environment.

In addition, in order to offer casino games to gambling enthusiasts and be able to do business around the globe, offshore casinos need a license from reputable gambling jurisdictions, which makes them safe and trustworthy.

Moreover, since no federal law prevents US-based players from gambling in licensed offshore casinos, they can enjoy playing their favorite games on these platforms. Safe online casinos that accept US citizens possess valid certificates and licenses and are monitored by reputable governing bodies. They also have enticing welcome bonuses, a slew of interesting games, and a protected online gaming environment.

Future of US Laws That Regulate Online Casinos

The future is bright. Really bright. The biggest obstacle toward legalizing online casinos in the US was that the government was trying to stop the gradual loss of citizens’ interest in their official gambling zones — Las Vegas and Atlantic City. Since that has already happened, there is nothing that stands in the way of progressive legalization of online casinos across the nation.

Not to mention the fact that states without legal online casinos are starting to lose gambling aficionados who travel across state lines in order to play in states where gambling is legal. For instance, the legislative trend in New York is going toward expansion of gambling activities rather than contraction, since the state doesn’t want to lose its players to its neighbor New Jersey.

FAQ

You need to be at least 21. Even though the legal age limit for the online lottery is 18, you have to be 21 to play in an online casino. It is likely that lawmakers will decide to change the limit in the future.

In the states where they are legalized, online casinos must follow strict regulations and are therefore completely safe. However, you should exercise due diligence — always do thorough research before you decide to join a casino.

Yes, you can; many casinos offer these games. Lately, a lot of online casinos have begun introducing this section on their platforms. Live casino games are popular since they offer a genuine casino experience. Of course, not all online casinos sport a Live Casino section, so make sure you find those that do.

Just like all other industries today, the online casino industry is very competitive, meaning there is a myriad of casino games at your disposal. Any land-based casino game you can think of probably has an online version. What’s more, online casinos can often surprise you and you can run into some games you’ve never even heard of.

To cater to the needs of their players and thus remain competitive, the majority of online casinos offer a broad selection of payment methods. This results in easy and secure online payments. Of course, the processing time depends on the payment option you select.

Yes, you can. Online casinos, like other websites, understand the importance of mobile optimization and do everything in their power to meet the needs of their players. Since many players prefer to use their smartphones to play games, most casinos either have a fully optimized mobile site or a dedicated mobile app.