Daily Archives: January 25, 2019

Online Gambling in Jeopardy in Wake of New Dep of Justice Ruling

Casino Watch Focus has reported on the impact of the Obama Administration’s reinterpretation of the long standing Wire Act. It very clearly made online gambling that crossed state lines illegal, but the Obama Administration said it only covers sports betting, thereby opening the floodgates to all forms of online gambling except sports betting. This understandably led to a lot of concerns and questions over the safeguarding of those with access to online casinos, poker rooms or lotteries. Casino Watch reported two years ago that the Trump Administration was heavily considering reversing that reinterpretation and restoring the Wire Act to its original congressional intent. The Associated Press is reporting that the Department of Justice has followed through: 

The 2011 opinion opened the door for cash-strapped states and their lotteries to bring online gambling to their residents, as long as it did not involve interstate sports betting.

Nevada, New Jersey and Delaware legalized online gambling after that opinion was issued, and the three states have agreements allowing poker players to compete online across the states. Pennsylvania became the fourth state to legalize online casino gambling in 2017.

Now, the Justice Department says the previous opinion misinterpreted the statute.

“Based upon the plain language of the statute, however, we reach a different result,” attorneys for the department wrote in the opinion dated Nov. 2. “While the Wire Act is not a model of artful drafting, we conclude that the words of the statute are sufficiently clear and that all but one of its prohibitions sweep beyond sports gambling.”

The Wire Act was enacted in 1961 to target the mob and its gambling activities.

The full scope of the impact of this decision by the Depart of Justice is still unknown and this story will continue to develop. It’s very possible that a sea of litigation will be opened up, but the Depart of Justice hasn’t fully explained how severely they plan to enforce this interpretation. The AP continues: 

Jennifer Roberts, associate director of the International Center for Gaming Regulation at the University of Nevada, Las Vegas, said the impact of the opinion rests on how strictly the Justice Department is going to enforce the new interpretation of the statute.

“Some could go really far and say even if you send a text message to a casino customer in another state and you are saying ‘Come play blackjack this weekend here’s a deal,’ arguably you can say that is information that assists in the placement of a wager,” she said. “I doubt it will go that far, but we will once again be subject to the interpretation.”

The new legal opinion will likely be challenged in court, an issue acknowledged by the department attorneys in their document.

Daniel Wallach, co-founding director of the University of New Hampshire School of Law Sports Wagering and Integrity Program, said the opinion could have “an immediate chilling effect” on the ability of states to conduct lotteries online.

“I think the most obviously impacted stakeholders are the lotteries that do internet sales, and that group is the most likely stakeholder to challenge this opinion in court.”

Advocacy group Coalition to Stop Internet Gambling and former U.S. Sen. Blanche Lincoln of Arkansas in a statement cheered the new opinion, characterizing the previous one as “problematic legally as it was morally” and calling the new one a “win for parents, children and other vulnerable populations.”

For more information on the dangers of gambling, please visit CASINO WATCH & CASINO WATCH FOUNDATION

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