Internet Gambling

Internet Gambling:

Regulation, Prohibition or Let ‘em Play??

(a) Whoever being engaged in the business of betting or wagering knowingly uses a wire communication facility for the transmission in interstate or foreign commerce of bets or wagers or information assisting in the placing of bets or wagers on any sporting event or contest, or for the transmission of a wire communication which entitles the recipient to receive money or credit as a result of bets or wagers, or for information assisting in the placing of bets or wagers, shall be fined under this title or imprisoned not more than two years, or both.

(b) Nothing in this section shall be construed to prevent the transmission in interstate or foreign commerce of information for use in news reporting of sporting events or contests, or for the transmission of information assisting in the placing of bets or wagers on a sporting event or contest from a State or foreign country where betting on that sporting event or contest is legal into a State or foreign country in which such betting is legal.

HAVE YOU VIOLATED THE WIRE WAGER ACT??

Please quickly visit the following websites:

Background:

86% of Americans have gambled at least once in their lifetime.
Currently, online gambling is believed to be a $2 billion/year business that is conducted on an estimated 1200 sites. This is expected to at least triple by 2006.
Gambling legislation is largely a matter of state law. Every state except Utah and Houston have legalized some sort of gambling.
Online gambling is banned in Nevada, Louisiana and Illinois. While other states have used existing law to litigate against participants, the use of state law is relatively ineffective due to budget and enforcement constraints.
The fight against online gaming is truly an international undertaking due to the offshore operators which enjoy little or no regulation and significant cost savings.

Increased Regulation??

In “Cyber Games?: Regulation of Internet Gaming in the United States”, John J. Savilia proposes a regulatory solution analogous to that used by the SEC for foreign issuer’s use of the internet to offer securities offshore. Please read (34 SFKULR 347).
Cara Franklin argues that regulation and licensing within the United States would allow for the collection of tax revenues, licensing fees and increased measures to verify age and addiction problems (2001 DUKELTR 21).

Prohibition??

Numerous legislative proposals have been made to prohibit internet gambling businesses outright. These include the “Unlawful Internet Gambling Funding Prohibition Act” (http://thomas.loc.gov/cgi-bin/query/z?c108:S.627: ). This bill would prohibit the use of payment instruments such as credit cards for unlawful internet gambling.

Other Solutions??

Although a majority of the commentary argues that increased regulation is necessary to combat the proliferation of internet gambling and the social ills that result, there are those that envision other solutions:

Bruce Keller argues that the law should focus on the underlying activity taking place on the internet rather than the medium which is used. This approach utilizes current legislation to combat the proliferation of internet gambling. (108 YLJ 1569)
In, “Internet Gambling: Popular, Inexorable, and (Eventually) Legal”, Tom W. Bell argues that the right to gamble is a fundamental property right. Further, he posits that either limited or no regulation of internet gambling will actually provide benefits to the public. Please Read (<http://www.cato.org/pubs/pas/pa-336es.html>).

Issues:

Should the US license and regulate online casinos?
Or, should online gambling be viewed as a social ill that needs to be prohibited? Could prohibition ever successfully be enforced?
If we do need more legislation, who should it target—the operators and owners of such sites or the its patrons?
Is more legislation needed? Is the Wire Act not enough?
Do courts in the United States have jurisdiction over online casinos based in foreign countries? Please read People v. World Interactive Gaming Corp., No. 404428/98, 1999 WL 591995, at *4 (N.Y. Sup. Ct. July 22, 1999)