Legalities of Online Casinos in US

There are countless myths and misconceptions regarding the legality of playing at an online casino for a US citizen. This article should set everything straight for you.

Prior to 2006 it was perfectly legal for US players to play at an online casino, poker room, or sports betting site. The online gaming industry grew from almost nothing in 1995 to a multi-billion dollar industry in 2006. A large faction of US politicians did not like all of the online gambling that was going on, so they decided to do something about it. The UIGEA [Unlawful Internet Gambling Enforcement Act] was passed. This act was meant to not only stifle online gaming by US citizens, but to end it altogether. The bill never has and never will target individual players; it was meant to punish banks for letting deposits and withdraws process. It is a crime for a bank to process money to or from an online gaming site of any kind.

The bill ended up being all talk and no action. Very little has happened and the online casino industry has only grown and grown. The bill did cause two major changes in the industry. The first change is that many online casinos do not accept players from the United States. They know as well as anyone that they will likely never have to worry about sanctions from the US government, but they follow the “It’s better to be safe than sorry” motto. This means fewer options for US players, which is never a good thing. Sites that do accommodate players from the US should treat you the same way

The second change is that banks do not do business with online casinos. You can receive direct bank wires as a withdraw method, but I do not recommend it. If you do opt for the bank wire withdraw method do not be surprised to get a rude phone call from the manager of your bank. Second tier payment methods such as Click2Pay, Neteller, and Moneybookers have grown in popularity over the past 4 years because of this. This is an annoyance, but it should not be too big of a deal in the long run.

As an individual player you have very little to be worried about. If the US government ever wanted to truly crack down on online gaming, they would go after all of the sites hosted and run offshore that offer their services to US players. Remember 4-5 years ago when everyone was downloading music online illegally and there was supposed to be a huge crack down on it? People caught downloading music and not paying for it was supposed to pay hundreds of thousands of dollars in fines. Little to nothing ever happened and many are still downloading music illegally.

Almost everyone involved in the online gaming industry has been begging the US government to tax their winnings! Players want to pay taxes, websites want to operate in the US and pay corporate taxes. There was hope in 2008, when a liberal president was elected that a reversal in the UIGEA would occur. Unfortunately the matter has been virtually left untouched and there is still a quiet stigma surrounding online gaming in the US.

Surprisingly a bill passed in 1961 has had a bigger impact on the online gaming industry than the bill meant to stop online gaming in the US in 2006. The federal wire act was enacted in 1961 and was meant to help enforce anti-gambling laws. Anyone “engaged in making bets or wagers” that “knowingly used a wire communication facility” was subject to jail time. No one could have foreseen in rise in the internet almost 50 years ago, so it is difficult to determine whether this bill has any authority with regards to online gaming. If the internet counts as a “wire communication facility” then the wire bill may end up making an impact on the online gaming industry.

Participating in online gaming as a citizen of the United States may or may not be perfectly legal. Regardless you have little to worry about when it comes to enforcement of any of the anti-gaming laws.

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