2019.02.02

Uncertainty over legal status of online gambling in the USA surfaces

While disputes over impact of online gambling continue to simmer across the world, the US citizens have got something new to bother about. The Department of Justice has made a new interpretation of the 1961 Wire Act and this has led to the confusion over the legal stature of US online gambling activities. 

This is not to say that the US online gambling industry, which is pretty huge- will come to a screeching halt. Nothing of that sort is going to happen, but the new move will widen earning options for the lawyers in the near future. 

The confusion is over the way the phrase “bets or wagers on any sporting event or contest” has been used. It is not clear if the amended 1961 Wire Act restricts all bets or wagers or those pertaining to “sporting event or contests”. It seems to be more of a limiting phrase and not illustrative. Eventually, this will make a division among the lawyers, who will fight either for or against the connotation of the amendment. 

This can be explained by the situation prevailing in the so called legal cannabis industry of the USA. Technically speaking, the US legal cannabis industry is non-existent and it is actually illegal. At the federal level, selling and trading of cannabis was and still is illegal. However, the federal agents rarely raid any supplier or company selling Cannabis products in the USA! This is because it will lead to mass outrage and the repercussion can be severe for the government.

So, it is only logical that the DOJ will not try to enforce this reinterpretation and make extensive raids to online gambling company offices nationwide! They will not arrest the owners of companies like MGM, Caesars, and other top ones in the sector. This is something the incumbent US president will not want. Even if they do it low key and want to issue fresh cease and desist orders- that won’t be endorsed by the NJ state government.

Despite the repeated and earnest efforts of Sheldon Adelson and his groups to put a stop to Internet Gambling activities in the USA, the reality is it is not simply going to happen. For all of his efforts, he got the DOJ to reinterpret the Wire Act and it may give him a sense of relief that he won, at least theoretically in the long drawn battle. The federal agencies also can feel relieved for now. The stark reality is this change in DOJ stance took almost 2.5 months to get into media attention. 

Much like cannabis legalization is not likely to be reversed even though it remains illegal, online gambling legalization may not be reversed even though it technically is illegal- as per the new reinterpretation. Legal definition of an act is something and how it is implemented in a country with a complex web of judiciary and government functioning is something else. It is certain sure that the federal government will not harass the grey-area industries anytime soon, including online gambling.

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