The controversy surrounding the legality of online poker in the US is unusual considering that the free market system is a major cornerstone of the American way of life, especially when poker is more commonly referred to as ‘America’s card game’. To expert players and the general public, poker is a sport and that’s the reason it’s now a televised event on TV. Contrary to what some people may think, there’s no federal law in the US that specifically outlaws playing poker online. However, state laws may or may not forbid online poker depending on the state you are in.
The Federal Wire Act, also known as Interstate Wire Act, which was passed in 1961, prohibited the operation of all betting businesses. This, position was however reversed in 2011 by the Justice Department, which stated that the Federal Wire Act only applied to sports betting.
Passed in 2006as part of the Safe Ports act, the Unlawful Internet Gambling Enforcement Act
[UIGEA] criminalized accepting payments from illegal online gambling. As a practical matter, “illegal online gambling” was not defined and because the Wire Act solelyapplied to sports betting, online poker was not prohibited. Although UIGEA did not render online poker as illegalunless state laws indicated otherwise, it made life harder such that many online poker rooms stopped accepting US players.
Poker Player’s Alliance
Founded in Washington in 2005, the political advocacy group Poker Player’s Alliance [PPA] was formed to protect USpoker players’rights. Their brief includes reversing UIGEA plus fighting to legalize online poker. Multiple congressional bills have been tabled to amend UIGEA and make an exception for online poker but none have passed so far.
On April 15, 2011, the DOJ [Department of Justice] shut down the three poker sites with the most traffic [the Cereus Network, Full Tilt Poker and Poker Stars] on charges of fraud and money laundering which violated UIGEA.In July, 2012, the U.S. government dismissed the suit “with prejudice” though a criminal charge against the three still held. Full Tilt Poker and PokerStars would eventually settle without admitting guilt. The Black Friday events didn’t criminalize online poker although they affected actual play from which the industry has yet to recover.
New Jersey, Nevada and Delaware
The states of New Jersey, Nevada and Delaware have passed laws that explicitly legalize and regulating gambling on the internet.To legally gamble in any of these states, a player must operate their playing device within the state and be of gambling age. The three states aren’t the only ones where the game is legal but they’re the only jurisdictions that have specific laws legalizing and regulating online poker. In the US, unless a law prohibits it, an activity is legal which means the lack of laws in some states does translate to committing of a felony.
The big question then becomes, can US residents play real money poker legally on the internet? The short answer is; state laws vary. The general state gambling laws have made online poker illegal in most cases. While only New Jersey, Nevada and Delaware have legalized and regulated online poker, the only state which has a law explicitly forbidding playing poker for real money is Washington DC. Washington State passed a law in 2006 made playing online poker a serious crime.
Currently, there are at least nine other states which have proposals to legalize and regulate online poker. And as far as we can tell, no one within the US has been convicted or indicted for a crime that’s related to playing online poker for real money, so far anyway. This, however, could change in the blink of an eye and players are therefore advised to only play online poker if it is legal where they live.
Mississippi has an interesting history as far as gambling goes. There was a time when residents of Mississippi and visitors alike gambled on almost everything and did it almost everywhere. That was the 17th century era when Mississippi was not actually a formal state. Then, people could bet on races and participate in Lotteries just as easily as they played poker and other betting games. Gambling became so rampant in the area that as years passed it became a national concern. For that reason, when there was room to control it, the authorities clamped on it as if it was a menace.
For many years, Mississippi residents had no casinos to visit and play poker or partake in any other betting activity; and they had no lottery to speak of. And considering that online gambling is a relatively new development, one that has come with advanced technology, it means that people in the state could not play online poker either when the brick and mortar casinos were closed down.
Gambling Was Tainted In Early Centuries
The reason Mississippi frowned upon gambling for many years is that it created a bad image in the early centuries when the place was known for its vibrant trading activity. People from many parts of the state and beyond would come to this trading hub and take time off to enjoy gambling that was rife within the many riverboat casinos. Steamboats also provided gambling facilities and people would cruise and play poker and other betting games to spice up their leisure along the famous River Mississippi. Obviously, there were many people who went home richer than they had come, above their trading profits, but others, definitely had horrifying stories to tell. Without regulation, the gambling activities took place within a jungle-like environment and for that reason, cheating was prevalent. Some poker players were unscrupulous and victims spoke of card-sharps in many of the boats.
Poker enthusiasts were, however, not deterred from partaking in their favorite pastime, and so they learn to survive and enjoy their games. But the vibrancy along the Mississippi was rudely cut short by the civil war that broke out in the 1860s. After the war, life in Mississippi did not return to normal. Trading was affected and, of course, playing poker and the rest of the gambling could not resume as before. Soon, as state laws were put in place, gambling was prohibited. It meant that poker enthusiasts could only play clandestinely. For almost a century there was not much gambling one could speak of in the state of Mississippi; at least not legally.
Mississippi Legalized Gambling In 1990
1990 saw the change of the gaming environment in Mississippi. The state passed the Gaming Control Act and people could now play poker and such other games without restrictions. Investors could now run casinos legally. In fact, many casinos came up along the coast and within the counties bordering River Mississippi, but that had to happen in concurrence with the local residents. Today, residents and visitors are happy to board boats sailing in the Mississippi and enjoy their poker and the breeze at the same time; or relax in the casinos on land while gambling.
Some Betting Still Prohibited
Still, the state laws in Mississippi have not liberalized gambling in its entirety. For instance, betting in horse racing is prohibited. The state does not also provide for a lottery. And residents of Mississippi are not allowed to engage in social gambling. This goes to show how keen the authorities are to keep gambling under control. Gladly, bingo games and raffles are allowed for charitable causes. It’s odd, though, that the state laws permit betting on dog fights. However, that permission is not of much consequence today as animal rights activists have ensured that the fights are almost non-existent.
People in the state of Iowa frequent the casinos that exist and engage in the different gambling activities available, including the game of poker. The state laws in Iowa allow for particular betting games within brick and mortar casinos, and so there is no danger of patrons being rounded by the police for illegal betting. There is, for instance, a state lottery; some pari-mutual betting; and, of course, the not-so-many casinos offering poker and such other betting games. For someone to legally participate in betting in these casinos, the minimum age of 21yrs must apply.
As in other countries all over the world, or even other states in America, various local communities are more inclined to gambling than others. As such, investors in the business of providing gaming facilities assess the local trend before making a decision whether to run a casino or not. When it comes to the vast state of Iowa, it may help to know the counties that do offer gaming facilities; places where locals and visitors can pop in and play a game of poker or any of the other legal betting games.
Poker enthusiasts who are not much interested in online poker but would rather they interacted live with other poker players can find convenience in the casinos that are fairly spread over the state. Those include casinos in the counties of Pottawattami, Monona, Des Moines, Dubuque, Worth, Lyon, Woodbury, Scott, Clayton, Black Hawk, Tama, Polk, Washington, Clark, Clinton, Palo Alto and Greene. As long as poker players as well as their hosts observe the law regulating gaming activities in the state, Iowa offers a friendly gambling environment.
It is also important to keep updated with the changes taking place and affecting the way gambling is conducted on the ground. As from 2015, for instance, the state laws have become specific about the mode of payment when it comes to stakes in poker and such other monies. It is illegal now to accept credit cards in the state of Iowa. In short, anyone playing poker in Iowa, whether from a conventional casino or from a website offering online poker services can only pay in cash or check; or even use a debit card. That is to say that there must be proof of the person being liquid. This bit of legal provision is meant to restrict people in Iowa from going into debt as a result of playing poker and other betting games. In fact, Senator Tony, Bisignano who suggested the piece of amendment barring the use of credit cards in poker rooms and such other gambling places, asserted that it is not just professional poker that gets people into financial woes. Social gambling is just as bad.
Online Gambling in Iowa
Whereas the state laws barring the use of credit cards are bound to apply to online poker as well, the freedom to engage in online gambling within the state of Iowa still remains. There are many sites available, some hosted within the state and others outside Iowa. One thing, though, that online poker players from Iowa need to check out first is the legality of using real cash in the various sites outside Iowa. It is advisable to avoid using real money to pay for online gambling on sites hosted in states like New York where there are restrictions. In fact, it is important for any player engaging in online poker on such sites to do some due diligence first because some may be hosted by unscrupulous people who do not care about the law. Yet, if caught breaking the law, the poker player may be held personally liable and possibly lose all monies spent.
In the US, revenues from poker may have dropped in recent years, but that is only in line with what is happening elsewhere in the economy. The US is one of the countries where the game of poker is well established. There are few people, for instance, who have not heard of the popular Las Vegas casinos. What is, however, relatively new to many people is online poker. Yet online poker is one of the betting games that can earn the country lots of revenue if well regulated. Of course, some US states have identified that opportunity and have passed state laws to regulate online poker.
US States that have legalized online poker
Any US resident or visitor who wishes to play online poker without looking over their shoulder will be at home in New Jersey, Delaware, as well as Nevada. Those are the three states that had officially legalized online poker as of 2013. Nevada, the state famous for its casino city, Las Vegas, led the other states in legalizing online poker. That means that the avid poker players who grace the brick and mortar casinos can continue their experience online whether they are playing poker as a hobby or a profession.
The mystery surrounding online poker has diminished with the three states having made the online game legal. There is, therefore, not much fear now that online poker may be detrimental to the economy of individual states. On the contrary, interested states have begun to see the possibility of collecting additional revenues through sites that host online gambling. Following this new outlook, there are a number of states that are likely to be more liberal and make online poker legal. These states include California and Washington; Pennsylvania and New York; New Hampshire and Massachusetts; Louisiana and Illinois; as well as Texas.
How the State Protects Individuals
One positive aspect of legalizing online poker is that it becomes easy to let poker players know the sites that are legal, and thus protect them from unscrupulous hosts who may end up swindling players of their money.
At the same time, there is liberty in the states that have legalized online poker to sign in as a player even when the person does not live within the state. Some sites may even allow someone to make cash deposits from wherever they are outside the state. Such deposits are held safely by the site and the only restriction is the actual location of playing. As things stand, it is necessary that a player be within the borders of the state that has legalized online poker in order to participate in the online gambling.
A good example is a poker enthusiast in the state of Washington. Such a player can sign onto a gambling site within Nevada where poker is legalized and even deposit cash while still in Washington. That money is held safely and the player can use it on the poker hosting site when physically within the state of Nevada.
Just because a site accepts a poker player’s registration does not mean the site is legal. Sites that are legally hosting poker games may refuse admission to players who do not qualify to play within the concerned state, but most sites operating illegally usually do not have restrictions. While such easy admission may excite an American poker enthusiast, such sites are also risky to the player whose safety of deposits cannot be assured – at least not by any state authorities.
The good news is that it is easy to establish online if a website that is hosting online poker is legal in the US or not.
Colorado is likely to have a bill on online poker passed very soon. There has been much lobbying in this regard, and poker lovers in Colorado are hopeful that online poker will soon be legalized. In a number of US states, the poker law is not explicit especially regarding online poker. That means that betting enthusiasts are unable to foretell if and when they are crossing the line in regard to the state poker law. Colorado has around forty casinos, and a good number of them provide poker rooms. Needless to say, casino owners will be among the happiest people when the Colorado Gaming Commission succeeds in getting the law on state online poker passed.
Debate on Pros and Cons of Online Poker
For close to five years now, interest regarding online poker has been rising in Colorado. With equal measure are the concerns about what online poker may do to the conventional arena of poker. First on the list of concerns is the possibility of revenues from brick and mortar casinos dropping when some old patrons turn to online poker. The debate about online poker began to gain volume around 2011 when the Colorado Gaming Association released a report on a study they had commissioned dwelling on the prospects of online gambling and its effects on the existing Colorado casinos.
Colorado legislatures took the debate on online poker seriously, and in 2012 they initiated a bill that was meant to lead to legalization of online poker in the state. Colorado state laws have not addressed the issue of online gambling before, and that leaves poker players as well as their fans wondering where the state stands with regard to online gambling. It will be a great relief when ultimately the poker law is enacted and particularly addressing the state online poker law. As owners of brick and mortar casinos fear, failure to address the topic of online poker with a view to regulating it is likely to jeopardize commercial activity in the industry.
State Revenues from Gambling
Currently, the state of Colorado gets a whopping $750 million annually in annual revenues from casinos. If the online poker bill draft is passed into law as is anticipated, the state will, very likely, reap more revenues from the gambling sector. One pertinent point is that the brick and mortar casinos and hosts of online poker need not be mutually exclusive in terms of ownership. In fact, owners of current casinos may wish to participate in hosting online poker as well as long as they understand the infrastructure and the legalities involved. They may also wish to spread their tentacles to neighboring states. That would make it easy and convenient for the state of Colorado to gather revenues from a much bigger number of gambling centers. These are great prospects for the state as far as budgetary issues are concerned.
Colorado Has Not Been Enthusiastic In The Past
It is tempting to think that the state of Colorado has been enthusiastic about gambling considering that 40 is not necessarily a small figure when it comes to number of casinos in the state. However, that is not the case. Granted playing poker is legal in Colorado; but the ceiling for betting amounts is quite low – $100. That might come as a surprise to people who are familiar with the gambling that takes place in Las Vegas casinos and such other vibrant casinos. And even this $100 is an improvement. Before 2009, a gambler could only bet $5 and below at any one time.
However, Colorado can no longer afford to ignore the need to liberalize poker a bit more. The fact that New Jersey and other states like Nevada have embraced online poker is itself enough pressure for Colorado.
Over a decade ago, US poker players and other game lovers were concerned that attempts at establishing state laws legalizing online poker and online gambling in general would never succeed. However, people continued to play poker in casinos and established clubs that offered betting games, and they also took time to venture online whenever they had access to poker sites. Sometimes poker players just took advantage of the fact that many state laws were silent on the legal position of online poker in their state.
Soon, however, the hopes of poker lovers were to be crashed by the enactment of the Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA) which was clear indication that the US was bent on criminalizing online gambling. Luckily, for gambling enthusiasts, the law as it was became untenable. The US had already gotten used to having casinos and other brick and mortar clubs that offered gambling facilities, and therefore UIGEA could not have been seen in any other light but as a crackdown on internet gambling. After intense and unchecked ridiculing of that law, America let go and today, poker and other gambling activities are, for most part, regulated by individual state laws.
Why the Department of Justice (DOJ) thought UIGEA would work
The team that drafted the bill that developed into UIGEA had banked on the strength and spirit of the 1961 Interstate Wire Act, otherwise referred to as the Federal Wire Act. Their premise was that UIGEA would not be introducing anything new as the 1961 law already criminalized remote gambling. Of course, online gambling fell under remote gambling. That assumption was proven wrong in 2011 when the country put bare the fact that the Wire Act only banned betting in races and other sports and not online poker or other betting games.
That clarification of the federal government’s legal position gave a sigh of relief to the gaming fraternity that had already found a great gaming environment in online poker and online gambling in general. This was the juncture at which the role of handling gambling was left to individual states. Each state was to enact its own state laws regarding online poker and gambling as a whole.
States that have led in legalizing online gambling
Delaware was the pioneer in making online gambling legal, and it even extended the scope of legality to include gambling activity from other US states. In fact, the state laws in Delaware were so liberal that the only betting activities they locked out were lotteries and also keno. From Delaware, US residents could play baccarat; blackjack; bingo; wheel of fortune; craps; online poker; roulette; and related games and their variants.
Next in line was Nevada. This state that is famed for its gambling culture, particularly in its city of Las Vegas, took a bold step of legalizing online poker while at the same time taking caution not to legalize online gambling in its entirety. Of course, over the years, the state of Nevada, through its control board, has licensed a wide range of other online gambling activities.
As for the state of New Jersey, the state laws on online gambling may have remained confusing over the years, but the fact that the Department of Justice went ahead this year and licensed PokerStars to include New Jersey in its online gambling tournaments means there is potential growth of online poker and other online games in New Jersey and the rest of the US. In fact, the best part is the unfolding trend of states legalizing online gambling and not restricting it to the state residents alone. Permitting intra-state online activity is indication that the US online gambling scene is soon going to become very vibrant.