US Gambling Law FAQ

US Gambling Law FAQ
(These are common consensuses from experts across the web. But hey don't listen to anything I say, and always consult a lawyer before making your own decision.)

1. Is it illegal to play online poker in the United States now?
No. The bill which recently passed addressed deposit methods and financial institutions (banks) that allow gambling transactions, not the players. A US DOJ official said in a Congressional hearing it was not illegal for US players to play online. The new law makes it illegal for US banks to allow gambling related transactions so the actual legality of online poker has not changed. There has been much debate over this issue for years but to this date no one has been arrested for playing poker online. Although, it is clear that online sportsbetting is definately a federal crime nobody has been arrested for playing online poker.

2. Is it safe to play online poker in the US?
The following question was answered by the authoritative online gambling legal expert, I. Nelson Rose here in September of 2007. To summarize, he says you are not going to jail for playing poker, it is safe to cash/deposit checks from poker sites as long as you're reporting income and to not keep too much money located at one site because there is the possibility it gets tied up ie: the Neteller & BetonSports incidents. He also makes a point to be very careful as to what ewallet you use.

3. Why did Party Poker and other sites close down and yet some sites are still open to the US?
Most of the sites that closed down when the bill was signed were the publicly traded companies. They closed down to US players to protect themselves from getting sued by their shareholders. Places like PokerStars.com are privately held and they have addressed the law differently which is why they stayed open. They believe poker is a skill game. They also believe their sites aren't classified as "Unlawful" because mainly sportsbetting was addressed in the 1961 Wire Act defining "Unlawful gambling" and US courts have ruled in the past that not all online gambling is illegal. Every site has different interpretations of the law.

4. So what is the deal now? Is poker banned and what happens next?
People are still playing online poker and we are still in a grace period. The US government had 270 days from the time the UIGEA bill was signed (Oct 13, 2006) to issue requirements for US banks and payment providers. The regulations have since been released (view proposed regulations) and were commented on up until Dec. 12, 2007. After which a "reviewal" period has commenced where the regulations are revamped to incorporate the comments and suggestions. No deadline was given for the regulations to be amended. We do know that once regulations are amended banks will likely have 6 more months until they are forced to have the regulations fully running. It could likely be October 1, 2008 before anything changes. Read I. Nelson Rose, Gambling Law Professor's view of the proposed regulations.

5. Am I going to jail if I play online poker?
According to Gambling Law Professor, I. Nelson Rose, you will not go to jail for merly playing poker online. Again, this bill is attacking the root of the online poker industry, the deposit mechanisms. No laws have changed for online poker players. It was always a grey area before this law and remains the same. Some states have had laws against online gaming for years.

6. Why are some states not accepted at certain online casinos and poker rooms?
The reason some operators have excluded certain sites and not the whole US population is because they are interpreting the law differently. The law addresses "Unlawful Internet Gambling." This means that the casino believes the states that had pre-existing law regarding online gambling are the states affected by this new law.

7. Why would Neteller, myCitadel, Firepay and other 3rd party transaction sites even think about closing to US gamblers?
The text book answer is that they are a publicly traded company. But there is much more to it than that. Let's take Ewallet X (fictitious name) for example. If the US government felt Ewallet X was used for illegal gambling transactions then the US government could simply stop all banks from making transactions with Ewallet X whether it be for gambling or not. Some ewallets aren't just in the gambling business and can't afford to lose all their US customers. Also, some ewallets went into contracts with certain gambling portals which allow sports bets to be placed among US citizens. This is against US federal law and is one reason the Neteller co-founders were detained. On the other hand, ewallets like Epassporte believe poker is legal to fund but not online casinos.