Online gambling restrictions are set to change in a drastic way with the introduction of the Internet Gambling Regulation, Enforcement, and Consumer Protection Act of 2013. The proposed bill calls for the formation of an Office of Internet Gambling Oversight to regulate legalized online gambling across the country.
The History of Online Gambling
Online gambling has been around since home Internet use became en vogue. Digital casinos cropped up in 1995, and million of people across the U.S. have started using online casinos to gamble for years.
Profits enjoyed by the online gambling industry quickly ballooned after the introduction of the first online casino. Annual profits soared to $1 billion by 1997 and increased to $10.9 billion by 2007.
The Unlawful Internet Gambling Enforcement Act of 2006 was passed to regulate the online gambling industry. The Act prohibits the sending of a bet or wager over the Internet. Companies that are caught receiving these types of payments from individuals are subject to legal action under the Act.
Current Online Gambling Laws
As noted above, the Unlawful Internet Gambling Enforcement Act of 2006 makes it illegal for a company to collect bets or wagers from a person through the Internet. Banks are also forbidden to allow online transfers of money for the purposes of gambling.
However, the Act does allow states to mandate whether gambling online is prohibited. Some states allow residents to participate in online gambling, but there are states in which it is a crime to place a bet online. Punishments for online gambling vary widely. For example, the state of Washington considers online gambling to be a felony.
Sports betting in particular has been banned in many states. This specific type of online gambling is prohibited under the Professional and Amateur Sports Protection Act.
Reasons For the Banning of Online Gambling
While lots of people feel politicians’ online gambling bans are merit-less, there are cited purposes for Internet wagering. Many of these reasons stem from the supposed need to protect Americans from the risk of identity theft.
- Most of the online gambling companies that are currently in business have offshore headquarters that are run by unknown entities. Legislators worry that Americans are sending their money and personal information to unknown companies that may inappropriately use this information.
- There is no way for the age of a gambler to be verified when online gambling is allowed. Although age verification may be required in order for a person to enter a website, children have the ability to enter false information or use an adult’s personal information to gain access to gambling websites.
- Online gambling may be too accessible for people who suffer from a gambling addiction. People who have an addiction could run up credit cards and run into long-term financial problems when bets and wagers can be made from the comfort of home.
Upcoming Changes in Online Gambling Law
New legislation has been introduced that would lift many of the bans on online gambling. The Internet Gambling Regulation, Enforcement, and Consumer Protection Act of 2013 would legalize online gambling and form regulations that aim to protect consumers and companies that are involved in Internet gambling. Casino games including roulette and poker would be allowed under the Act.
States can opt out, if desired. However, a limited window of opportunity lasting 120 days would be extended to states. Any state that fails to respond within this period of time would automatically opt in. Tribes are also given this option.
Licensing requirements outlined in the act would offer protection against identity theft and other negative consequences of online gambling. Any balance that a player holds in an online account with an online gambling company would be protected in case the company files for bankruptcy in the future.
Players could face consequences for cheating. Fines and jail time may be ordered for anyone who is caught cheating when gambling online.
Legal online gambling options have already started to pop up. One online gambling website currently offers legal online gambling options to residents of the state of Nevada and New Jersey.