The United States now permits intrastate online gambling, i.e., gambling contained by the borders of one state. Gambling that includes wagers that cross state lines, with the exception of fantasy sports and horse racing, remains illegal.
Online gaming in the U.S. wasn't as profitable as its proponents projected in 2014, but it did provide an infusion of cash into state coffers and showed some growth potential for the future.
In 2014, three states licensed, regulated, and permitted intrastate online gaming: Nevada, New Jersey and Delaware.
New Jersey – the most populous of the three states, with close to 9 million residents in 2014 – allowed Atlantic City casinos to launch real-money online gaming on November 16, 2013.
Online casinos in New Jersey must have their servers located in an Atlantic City casino and are permitted to offer any game played in the casino.
Like New Jersey, Delaware offers the full suite of casino games online. It began offering games on October 31, 2013, but has struggled to generate much revenue because of its small population. To compensate, it signed an agreement to pool liquidity for online poker with Nevada. The agreement was implemented in 2015, and Nevada and Delaware poker players are now playing against each other online.
The only online gaming activity Nevada regulates is online poker. Other forms of online gaming – with the exception of betting on horse races – remain illegal in Nevada.
One online gaming company, Ultimate Gaming, closed in 2014. Ultimate Gaming was the first company to launch an online poker room in Nevada (Ultimate Poker), in April 2013. It also operated both an online poker room and online casino in New Jersey.
The road to permitting intrastate online gambling has been a long and winding one. The chief obstacle to intrastate online gambling has been the Department of Justice's (DOJ) interpretation of the Wire Act.
The Wire Act was enacted in 1961 to prevent bookmakers from accepting sports bets over the telephone. For years, the DOJ maintained the Wire Act prohibited all forms of Internet gambling, while online gaming proponents maintained the Wire Act only applied to sports betting.
The DOJ's position prevented the domestic growth of online gaming in the U.S., although jurisdictions outside the U.S. offered real-money play to American residents.
In 2011, the DOJ reversed its long-held position that all forms of online gambling were illegal because they violated the Wire Act. In a letter released on December 23, 2011, the DOJ said the law applied only to sports betting, and intrastate gaming outside of sports betting did not violate the law. Gambling across state borders, say between poker players in California and Nevada, remained illegal according to the DOJ.
The ruling cleared the way for states to regulate and license intrastate online gaming. Nevada began issuing licenses to operators and software providers in 2012.
Nevada also adopted legislation in 2013 that allows it to sign compacts with other states to build player liquidity. Essentially, if Nevada signs a compact with a state, players on Nevada online poker networks will have access to players on poker networks in the other state and vice versa.
Delaware and New Jersey quickly joined Nevada in passing online gaming legislation. In June 2012, Delaware authorized online gambling in response to expanded brick-and-mortar casino gambling in Maryland and Pennsylvania. In February 2013, New Jersey signed into law online gambling legislation in an effort to help Atlantic City casinos. Unlike Nevada, New Jersey and Delaware are licensing and regulating the full suite of casino games, including table games such as blackjack, roulette, and craps.
Historically, gambling regulation in the U.S. has been reserved for the state governments. However, sometimes federal law supersedes state law. The Department of Justice (DOJ) had, prior to 2011, held that the Wire Act prohibits all forms of online gambling in all the U.S. states, and that view colored past prosecutions of online gaming cases. (Federal gambling law does not address games of skill or state lotteries that wish to offer subscription services on the Internet.)
Accusations of Wire Act violations are usually accompanied by other charges, including conspiracy; money laundering; and violations of the RICO Act, Travel Act and Illegal Gambling Business Act. Enforcement of the Wire Act is directed at the gambling operators; there is no language that makes it illegal for a consumer to place a wager.
Because the Act was written in 1961, its language is limited to communication systems that use "wires," and the types of betting it describes are limited to fixed-odds propositions, such as are offered on sporting and other events. It simply was not possible to have foreseen remote casino and poker games over 50 years ago, so taken literally, the language of the Wire Act is not adequate to apply to casino gaming and poker over the Internet. In a case involving online gamblers who tried to get their credit card debts ruled unenforceable because their online casino gambling had been illegal, the Louisiana Court of Appeals for the Fifth Circuit declared in 2002 that the gambling losses were indeed enforceable because "the Wire Act does not prohibit non-sports Internet gambling."
The DOJ disagreed with the Fifth Circuit Court of Appeals decision, and for years the Wire Act served as the foundation for all of the DOJ's arguments against the legality of Internet gambling for both sports wagering and non-sports wagering. DOJ officials asserted this belief several times before Congress since 2002. The DOJ also asserted this belief when advising the U.S. Virgin Islands and the states of Nevada and North Dakota against regulating online gaming. They also threatened and settled with media companies that advertised for online gambling companies.
The DOJ was successful in convicting Jay Cohen, president of World Sports Exchange, for Wire Act violations in 2000.
Internet gambling on horse racing is permitted by the Interstate Horse Racing Act in states that have chosen to regulate such wagering. Although the DOJ insists that the Act is not consistent with the Wire Act, it has never filed charges against any of the many domestic remote horse race wagering operators.
In fall 2006, the United States enacted the Unlawful Internet Gambling Enforcement Act (UIGEA), which makes it illegal for financial institutions to facilitate payment transactions between offshore gambling operations and American customers. The law says nothing about it being illegal for a person located in the U.S. to gamble on an Internet site.
The UIGEA resulted in the online gambling industry's publicly listed companies withdrawing from the American market, while many private companies continue to serve it.
UIGEA regulations require financial firms that participate in designated payment systems to implement policies and procedures designed to halt payments being made to gambling businesses in connection with unlawful Internet gambling.
Certain participants in designated payment systems are exempt from the rule because the government questions the practicality of these participants attempting to identify and block unlawful Internet gambling transactions. For example, participants in automated clearing house (ACH), check collection and wire transfer systems would be exempt, barring a beneficiary's bank or a bank that is directly involved with an illegal gambling business. The rule also outlines the types of policies and procedures that nonexempt participants in designated payment systems may adopt to prevent transactions restricted by the UIGEA.
The UIGEA regulations were approved on January 19, 2009. Financial institutions had to begin complying with the regulations by December 1, 2009.
The states of Illinois, Michigan, Indiana, Nevada, Oregon, South Dakota, Washington and Louisiana have all passed legislation that specifically prohibits unauthorized forms of Internet gambling. All forms of gambling are illegal in Hawaii and Utah.
In April 2008, federal regulators and representatives of the financial services community testified before Congress that any attempts to enforce the UIGEA would result in serious regulatory burdens. A result of the testimony was new legislation introduced by Reps. Barney Frank and Ron Paul, proponents of legalizing and regulating online gaming, which would prohibit the Department of the Treasury and Federal Reserve System from implementing any regulations related to the UIGEA. The proposed bill did not pass.
In October 2008, the state of Kentucky was granted permission by Franklin County Circuit Judge Thomas Wingate to begin the seizure of gambling websites. In January 2009, the Kentucky Court of Appeals overturned the ruling in a 2-1 decision, citing that domain names are not gambling devices under Kentucky law. The Kentucky Supreme Court reversed the appellate court's decision, saying the online gaming interests arguing the case lacked standing.
The Kentucky case is still ongoing, although a few online gaming companies have settled with the state. bwin.party settled its case with Kentucky for $15 million.
In April 2011, the DOJ indicted the founders of PokerStars, Full Tilt Poker and Absolute Poker/UB. The charges, most of which have been settled, resulted in the forfeiture of hundreds of millions of dollars in cash and assets, the sale of Full Tilt to PokerStars, the closing of Absolute/UB, and the withdrawal of PokerStars and Full Tilt from the U.S. market. In addition to shutting down the U.S. operations of the most popular online poker sites, the DOJ indictments convinced many operators to shut down their U.S.-facing operations, leaving American online gamblers with a limited marketplace.
That marketplace is now being filled, in a limited way, by the state-by-state expansion of online gaming.
In September 2015, New Jersey regulators approved a partnership between Amaya Gaming, parent company of PokerStars, and land-based casino Resorts Atlantic City. The approval cleared the way for PokerStars to re-enter the U.S. online poker market for the first time since April 2011. PokerStars launched in New Jersey in March 2016.
In early 2015, billionaire Republican power broker and Las Vegas Sands Chairman Sheldon Adelson began a push for Congress to ban all forms of online gambling. In February 2015, Rep. Jason Chaffetz (R - Utah) introduced a bill called the Restoration of America's Wire Act in the House Judiciary Committee. In June 2015, RAWA was introduced in the Senate by Sen. Lindsey Graham (R – South Carolina) and Sen. Marco Rubio (R – Florida).
In June 2015, Rep. Joe Barton (R–Texas) introduced his third attempt to advance federal online poker legislation since 2011 when he introduced the Internet Poker Freedom Act of 2015.
In October 2015, in response to an "insider information" scandal that brought attention to the burgeoning real-money daily fantasy sports industry, the Fantasy Sports Trade Association created a new control board to oversee the U.S. market in an attempt to avoid government regulation.
All 3 United States sites support English. edit your preferences
Poker Players Alliance
705 8th Street Southeast
Washington, District of Columbia
United States 20003-2985
View All Gaming Jurisdictions
United States Jurisdiction News
APCW Perspectives: Kahnawake out of U.S., Full Flush vanishes
The Kahnawake Gaming Commission has ordered their licensees out of the U.S. market after talks with the New Jersey Division of Gaming Enforcement. Meanwhile, players and webmasters continue to wonder about the future of Full Flush Poker, which went offline this week.
iGaming Education Forum confirms fantasy sports seminar
SiGMA 2016 will welcome co-founder and CEO of Oulala, Valéry Bollier, and Malta Gaming Authority's Senior Legal Advisor, Michele Magro, for a session dedicated to the current and future trends in the world of fantasy sports.
This Week in Gambling: Sheldon Adelson buys an online gambling bill
This week in gambling, the latest threat to online gambling in the U.S. has a familiar, bitter source: Sheldon Adelson. After the failure of his Restoration of America's Wire Act (RAWA), he has spent a lot of money to bring it back in the form of Senate Bill 3376.
Trends for US online gambling forecasted through 2020
Growth in the 34-and-younger population and the rise of non-mobile computer device usage has been predicted by global market research firm Technavio.
Instant Win Gaming teams up with Michigan Lottery
The supplier of instant win games has completed the first integration of a Remote Game Server onto a U.S. lottery.
APCW Perspectives: The 500th episode
This week, J. Todd celebrates the 500th show with online gambling news from Malta, France, China and the United States. Plus, information on another affiliate program closing its doors.
iAffiliates presents new promotion
From Sept. 1 to Oct. 31, affiliates can compete against one another in order to gain points to get a chance at winning a luxury vacation.
APCW Perspectives: Online gambling news from the U.K., U.S. and Israel
This week, J. Todd looks at a full week of online gambling news finds and stories from BoyleSports and William Hill. Plus, industry stories from Israel and the United States.
Donald Trump betting odds escalate in race for next U.S. president
With his poll numbers dropping and dissenters getting louder, Donald Trump's odds of become the next president of the United States are getting longer each day, to the point where William Hill Sportsbook is offering 10-to-1 odds that the Republican Party nominee will eventually bow out of the race against Hillary Clinton.
This Week in Gambling: Nevada mobile gambling for real money
This week in gambling, MGM Resorts recently launched their real money online gambling platform, giving players an opportunity to compete in bingo, video poker and slot tournaments. Also, which states in America are most likely to pass online gambling legislation in 2017?
APCW Perspectives: Online gamblin' wheelin' and dealin'
This week, J. Todd continues to watch the Ladbrokes-Coral merger play out as the gambling industry gets more interesting. Also, Rank and 888 talk about purchasing William Hill, and Antigua talks about how to collect millions from the United States.
U.S. Powerball entices Canadian players
Tens of thousands of Canadian customers are buying tickets for the U.S. Powerball from TheLotter for a chance at winning the $422 million (CA $555 million) jackpot.
APCW Perspectives: Online gambling news from both sides of the pond
This week, J. Todd talks about online gambling news from the United Kingdom and the United States. Also, a new APCW Sponsor is welcomed in Casino Extreme.
Around the WSOP: November Nine concept continues to help create 'brotherhood' among players
As the World Series of Poker Main Event entered the ninth edition of the "November Nine era," past final table participants spoke with Casino City about the special bond they've developed with each other.
Ex-NFL stars use WSOP Main Event to keep competitive juices flowing
Richard Seymour and Antoine Winfield were in the field during Day 1 of the World Series of Poker Main Event on Saturday. The former Pro Bowlers talked to Casino City about why they are so drawn to the game of poker.
Excitement – and change – is in the air at the 2016 WSOP
As the 2016 World Series of Poker kick off this week, a number of tweaks and adjustments have been announced with the goal of improving the overall experience and attracting new players.
Trump Taj Mahal reopens poker room; introduces 250 new slots
Trump Taj Mahal brings live poker back to Atlantic City this weekend and also launches the $1,000,000 Winning Ticket game, open to all Trump One members.
One-on-one with Wynn Las Vegas Director of Poker Ryan Beauregard
With the new Wynn Las Vegas poker room set to debut May 26, Casino City's Gary Trask sits down with Director of Poker Operations Ryan Beauregard to discuss why he thinks the new venue is "most luxurious" on the Strip and beyond.
48 hours of March Madness, Las Vegas style
Casino City's Gary Trask details his "bucket list" trip to Las Vegas last week when he spent two full days in the middle of the "madness" that is annually triggered by the first two days of the NCAA men's basketball tournament.
March Madness parties take center stage in Las Vegas
With the popularity of sports betting on a steady rise, Las Vegas will host numerous viewing parties next week when March Madness kicks into high gear and millions of college basketball fans flock to the city.
Top 10 reasons Las Vegas should have a professional sports franchise
Sports fans who live in Las Vegas have been dying to have a professional sports franchise come to "Sin City," something that may soon become possible thanks to the construction of T-Mobile Arena.
Las Vegas Casino Openings & Expansions: The Cosmopolitan unveils sports bettor's paradise steps off the Strip
A new state-of-the-art sportsbook at The Cosmopolitan Las Vegas has brought unrivaled energy to the casino. Elsewhere, Wynn Las Vegas is moving its poker room and adding various player-friendly amenities while Golden Nugget Las Vegas unveiled $800,000 in upgrades at its spa and salon.
Americans to bet $4.2 billion on Super Bowl 50
Americans will bet $4.2 billion on Super Bowl 50 between the Denver Broncos and Carolina Panthers, up eight percent over last year.
U.S. Powerball prize rises to $1.4 billion
Jackpot soars to a record $1.4 billion after no winner in Saturday's draw.
Inside Gaming: Wire Act hearing a disaster for online gambling opponents
The recent congressional hearing into legislation that would ban online gaming couldn't have gone worse for backers of the bill even if they attempted to sabotage the three-hour meeting themselves.
Inside Gaming: GOP presidential candidates don't share Adelson's stance on online gambling
Las Vegas Sands Chairman Sheldon Adelson wants to ban online gambling at the federal level, but the major Republican candidates for president don't share the same view.