Gambling is enjoyed by millions of players across the world. The thrill of winning a hand of poker has been documented as far back as the early 1600s when Miguel de Cervantes wrote Don Quixote. In relative terms, the advent of the internet in the 1980s makes online gambling a recent addition to the family.
There is no doubt that online gambling brings an additional dimension to gambling than can be found in traditional casinos and sports bookmakers. But with that new terrain comes the need for regulation. This regulation helps to protect the player, the casino or bookmaker, and the country that both reside in. As with any industry that involves money exchanging hands, there are people who look to exploit others.
Gaming laws have been introduced and amended over the years in order to regulate the gambling industry. In the US, gambling laws have been front-and-center since the 1961 Federal Wire Act passed. This act was effectively one of the first sports gambling laws in the US. Since then there have been many acts, repeals, and amendments, especially with regards to online gaming law.
This shifting of the goalposts has led many Americans to question where legal online gaming is available, if at all. The simple answer is there is currently no federal gambling laws that make placing a bet online illegal. In fact, there are interstate gambling laws that make online gambling overtly legal. We have seen six states legalize sports betting in 2019 alone.
That being said, it is important to know what the current online gaming laws are. Each state has their own online gambling laws, and at the end of the day, you will want to be able to comfortably cashout your hard-earned winnings. Equally, it is important to know that there are legal restrictions on starting your own casino, should you ever wish to.
This article will go through the history of US online gambling laws, as well as what states currently welcome online gaming.
A brief history of US online gambling laws
The US has tried to maintain high standards for their gaming industry. Many of the laws were put in place to protect the industry from being exploited by illegal bookmakers who used wire transfers for money exchange.
The internet has brought a new environment for online gaming. If money is being bet during online games, laws will be needed to regulate the transaction. It ensures the safety and security of both parties and their money.
Some of the existing laws, that were put in place before the advent of the internet, have been used in case law when it came to understanding and prosecuting the online gaming industry. As a result, some acts have been repealed and amended for the new online gaming law that we have today.
Here is a brief history of the main US gaming laws that impact legal online gambling.
Federal Wire Act 1961
The Federal Wire Act was first passed in 1961. In essence, the Wire Act prohibited interstate wire transfer of money for sporting bets or wagers. It was meant to deter illegal bookmakers. The act passed way before the internet and online gambling existed. Decades later, many wondered if the act applied to online gambling as well. Interpreting the Wire Act has been the subject of court cases to this day.
In 2011, the US Justice Department released an opinion that the Wire Act only applied to sports betting. In 2018, the US Justice Department reversed that opinion to say that is applied to more than just sports betting. This has subsequently been challenged and set aside, before being appealed.
Once the dust finally settles, the Wire Act could still influence the US online gaming industry.
Professional and Amateur Sports Protection Act 1992
The Professional and Amateur Sports Protection Act (PASPA) was passed in 1992. The act prohibited sports betting nationwide with the exclusion of a few states – Delaware, Oregon, Montana and some areas in Nevada.
The act has been legally challenged over the years. In 2018, the US Supreme Court ruled that PASPA conflicted with the Tenth Amendment and repealed the act.
Unlawful Internet Gambling Enforcement Act 2006
The Unlawful Internet Gambling Enforcement Act (UIGEA) was passed in 2006. This act would have perhaps the biggest impact on the online poker industry in the US to-date. It was the act that was used for the Black Friday raid of the online poker industry. The UIGEA excludes fantasy sports, so don’t delete your team just yet.
The UIGEA prohibits gambling businesses from accepting payments in relation to a bet or wager made online that is illegal under the state of federal law. It did this by making it illegal for banks and credit card companies to process financial transactions from online gambling.
The term ‘accepting’ has become a source of maneuvering for online casinos and players. If you are making the wager or bet, it is not strictly illegal. If you are accepting payment, it is illegal. This has led to online casinos using third-party payment processors for the financial transactions, as well as disguising their revenue as payment for valueless items like golf balls.
The UIGEA came into public prominence on Friday 15 April 2011, otherwise known as Black Friday. On the 15th of April, 2011, the US Justice Department and FBI seized major gambling site domains. These included PokerStars, Full Tilt Poker, and Absolute Poker. Along with their domains, eleven executives were indicted with violating the UIGEA, along with fraud and money laundering.
Black Friday made a significant impact on the online gaming community. Many American players withdrew their funds, while others abandoned them for fear of being indicted. Some online gambling sites, including all listed on the London Stock Exchange, no longer accepted American players. Most online gambling sites subsequently changed their domain away from a .com address.
For some US players, the event brought a stark realization that their casino provider was not ever going to pay them their money. With the casino being illegal, it was difficult to force their hand. For sites and players that operate in the states where online gambling is legal, there is no threat of indictment.
The UIGEA has come under criticism over the years, but it has created a benchmark for state laws to build on. As a result, it is easier to track in which states online gambling is legal.
Online gambling laws by state
With the history of online gambling and sports betting laws in the US, it is easier to understand why it can be difficult to know your legal position as a player. The UIGEA set a standard with Black Friday but has since not followed through with the same vigor. The Wire Act is still being reversed and appealed, seemingly by each administration.
As a result, the best possible way for a US citizen to know whether they are breaking the law by gambling online is by knowing their state’s law for gambling. As there is no federal law prohibiting players outright, it is safe to consult the online gambling laws by state.
Gambling and sports betting laws per state
There are many states where gambling is legal, and many more who are in the process of legalizing it. Some states have no bills stating that online gambling is illegal or legal, and subsequently, don’t regulate it.
For sports betting, more states are passing bills to legalize it. Some allow for online sports betting, while others only allow sports betting from within a casino. It can be difficult to know where you stand without doing research. Here is a list of each state and its laws in relation to gambling and sports betting.
There are no Alabama gambling laws that legalize online gambling or sports betting. It is legal to gamble in a casino.
There are no Alaska gambling laws that legalize online gambling, casino gambling or sports betting. They are all illegal.
There are no Arizona gambling laws that regulate online gambling and sports betting. Casino gambling is legalized. Due to a lack of regulation, there is a lot of online gambling and online sports betting in Arizona with offshore casinos.
Arkansas passed state laws in 2018 which allowed for sports betting and gambling in casinos. It is still illegal to gamble online in Arkansas.
In terms of California gambling laws, online gambling and sports betting are not regulated in California. As a result, many Californians play online. Casino gambling is legal.
Colorado does not regulate online gambling and sports betting through any Colorado gambling laws. The State has decided that anti-gambling laws should be construed liberally, and at worst result in a Class 1 Petty Offense. Casino gambling is legal.
Connecticut classes gambling as a Class B Misdemeanor. That being said, the online gambling and sports betting industries are not regulated.
In Delaware, online gambling and sports betting are legal. Delaware was the first US state to legalize online gambling. The Delaware Gambling Competitive Act was passed on 28 June 2012.
For online gambling, you need to be a Delaware resident. Delaware residents can play on state-regulated gambling sites.
Online gambling and sports betting are not regulated through Florida gambling laws, which means it is not yet completely legal. Casino gambling is legal.
Online gambling and sports betting are patently illegal in Georgia. The laws do not mention online gambling outright, but they do make it clear that running an online casino is illegal. Therefore players need to use offshore websites if they want to play online.
All forms of gambling on contests of chance are illegal in Hawaii. Therefore online gambling and sports betting are illegal, as well as casino gambling.
All forms of gambling are seen as a misdemeanor in the State of Idaho. That being said, there are no laws against online gambling, so it appears to be unregulated.
In Illinois, online gambling is illegal and online sports betting is legal. That being said, you will still find Illinois residents playing online poker. At present, there is no online gambling bill making online gambling explicitly illegal. Many players will play on offshore sites. The only risk is that if they take your money, you won’t necessarily find much help from the courts.
On 29 March 2019, Illinois passed the Sports Wagering Act to legalize sports betting online. Illinois has given casinos 18 months to launch their sports betting before online providers are allowed to launch.
Since 8 May 2019, sports betting is legal in Indiana. This sports betting is only allowed at allocated locations and not online. Online gambling is illegal, however, Indiana gambling laws have never been used to prosecute online gambling players. Gambling in casinos is legal.
Since May 2019, sports betting is legal in Iowa for players 21 years old and older. Online gambling is still illegal in Iowa, however, gambling in casinos is legal.
Casino gambling is legal in Kansas, while online gambling and sports betting are not regulated. As a result, there are many online players.
Kentucky gambling laws mainly speak to casino operators as opposed to players. There are no laws prohibiting online gambling or sports betting. There are no casinos in Kentucky.
Online gambling and sports betting is illegal in Louisiana. It is explicitly stated in Louisiana gambling laws, so there is no grey area in this state.
There is one casino in Maine, but online gambling and sports betting have not been legalized. Online gambling and sports betting have not been outlawed, so offshore sites should be safe to use.
Online gambling is illegal according to Maryland gambling laws. There is a strong suggestion that sports betting will be legalized in the near future. Casino gambling is legal.
Online gambling and sports betting are illegal in Massachusetts. Casino gambling is legal.
Online gambling is legal in Michigan if you win less than $50. More than that could send you to jail. Sports betting is currently illegal in Michigan, but there is strong support to legalize it. Casino gambling is legal in Michigan.
While there are Minnesota gambling laws, there isn’t one that regulates online gambling. As a result you could play on an offshore site with little risk. Sports betting is illegal, while casino gambling is legal.
Mississippi has legalized sports betting, but only in a casino. Online gambling is illegal in Mississippi unless authorized by the state. Casino gambling is legal.
Online gambling and sports betting are illegal according to Missouri gambling laws. Casino gambling is legal in Missouri.
Online gambling is illegal in the State of Montana. As of 6 May 2019, sports betting is legal. Casino gambling is also legal.
Sports betting and online gambling are not legal in Nebraska. Casino gambling is legal though.
Online gambling is legal according to Nevada gambling laws. The only catch is that it must be a state-licensed casino. Casino gambling and sports betting are both legal in Nevada. The pull of Las Vegas draws players from around the world.
At the moment, online gambling is illegal in New Hampshire. Sports betting was legalized on 12 June 2019. Casino gambling is legal, although there are restrictions on the types of games available.
The New Jersey gambling laws have legalized online gambling, sports betting, and casino gambling.
In New Mexico, casino gambling is legal. Online gambling is still illegal, although it is not regulated. Sports betting has not been officially legalized, but there are two casinos that offer sports betting.
Casino gambling and sports betting are legal according to New York gambling laws. Online gambling is currently illegal, but this could change in the near future.
According to North Carolina gambling laws, casino gambling and sports betting are legal. Online gambling remains illegal.
Sports betting and casino gambling are legal in North Dakota. Online gambling is legal for bets under $25. Above that amount, you’ll be liable to pay a fine.
Online gambling and sports betting are conditionally illegal according to Ohio gambling laws. That being said there are no clear penalties and it is not regulated. Casino gambling is legal.
Oklahoma gambling laws dictate that you can pay a fine or serve jail-time for online gambling and sports betting. Casino gambling is legal.
Online gambling is not legal in Oregon, but it is also not regulated. Sports betting and casino gambling are both legal.
The Pennsylvania gambling laws allow for sports betting, both in-person and online. Online gambling is officially legal at registered online casinos. Casino gambling is also legal.
Online gambling is currently illegal in Rhode Island. Sports betting and casino gambling, on the other hand, are legal.
Sports betting, online gambling, and casino gambling are all illegal in South Carolina.
Online gambling and sports betting are illegal in South Dakota. Casino gambling is legal.
On 30 April 2019, sports betting became legal in Tennessee. Online gambling and casino gambling remain illegal.
Texas gambling laws prohibit online gambling and sports betting. It currently has two legal tribal casinos.
In Utah, all forms of gambling are illegal: online gambling, casino gambling, and sports betting.
Online gambling and sports betting are illegal in Vermont. Casino gambling is also illegal.
Virginia gambling laws have been revised in the last few years, and there are plans for more casinos to be built with more games available. Online gambling and sports betting are both still illegal, although un-regulated.
Online gambling and sports betting are illegal in Washington. Casino gambling is legal.
Sports betting, both in-person and online, and casino gambling are legal in West Virginia. Online gambling is currently illegal.
Casino gambling is legal in Wisconsin. Online gambling and sports betting are illegal, however, it is not regulated.
Online gambling and sports betting are currently illegal in Wyoming. Casino gambling is legal.
Gambling within the law
As you can see, gambling laws differ from state to state. If you want to be safe, you can legally play online poker in Delaware, Nevada, New Jersey, and Pennsylvania.
If you are interested in sports betting, you can legally play in Arkansas, Delaware, Illinois, Indiana, Iowa, Mississippi, Montana, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, Oregon, Pennsylvania, Rhode Island, Tennessee and West Virginia.
Laws are constantly being reviewed, especially with online casinos. When your state legalizes online gambling, make sure to use a US online casino that you can trust.