1. Only two locations would be allowed to offer sports betting under the law, with the state's lottery providing regulatory oversight. In early 2019, the law was tweaked to provide for mobile betting.
2. A former California college athlete charged with running an international drug trafficking and illegal gambling organization was sentenced to more than 21 years in federal prison.

Federal Regulations For a number of years, the United States argued against the legality of internet gambling by citing the Interstate Wire Act, which was Congress passed to prohibit sports gambling between states by using the telephone or other wire-containing devices.

The Professional and Amateur Sports Protection Act of 1992 (Pub.L.102–559), also known as PASPA or the Bradley Act, is a judicially-overturned law that was meant to define the legal status of sports betting throughout the United States. This act effectively outlawed sports betting nationwide, excluding a few states.

The sports lotteries conducted in Oregon, Delaware, and Montana were exempt, as well as the licensed sports pools in Nevada^[1]. In addition, Congress provided a one-year window of opportunity from the effective date of PASPA (January 1, 1993) for states which operated licensed casino gaming for the previous ten-year period to pass laws permitting sports wagering. The latter exception was clearly crafted with New Jersey in mind. However, New Jersey failed to take advantage of this opportunity. Excluded from the reach of PASPA are jai alai, as well as parimutuelhorse and dog racing.

In a May 2018 decision in Murphy v. National Collegiate Athletic Association, the Supreme Court of the United States ruled that PASPA conflicts with the Tenth Amendment.

History[edit]

On June 26, 1991, the Senate Judiciary Subcommittee on Patents, Copyrights and Trademarks held public hearings on sports gambling. It found '(s)ports gambling is a national problem. The harms it inflicts are felt beyond the borders of those States that sanction it.' David Stern, the then-commissioner for the National Basketball Association, testified that 'The interstate ramifications of sports betting are a compelling reason for federal legislation.' In light of these findings, Congress exercised its authority under the Commerce Clause to enact Senate Bill 474 Professional and Amateur Sports Protection Act (PASPA) in 1992, codified at 28 U.S.C. § 3701.^[2]

Legislative efforts against the act[edit]

New Jersey has been a leader, both in legislation and in the legal process, in support of the legalization of sports betting in New Jersey despite its original failure to take advantage of the carve out in the PASPA of 1992. The law is also known as the 'Bradley Act', named for New Jersey Senator and former NBA star Bill Bradley. New Jersey voters in 2011 voted for a state constitutional amendment that would permit sports gambling. The next year, the NJ State Legislature enacted the Sports Wagering Act ('2012 Act'), allowing sports wagering at New Jersey casinos and racetracks.^[3]

Legal challenges[edit]

Proponents of repeal typically assert that the law as written is inherently unconstitutional, as the Tenth Amendment of the U.S. Constitution reserves to the states all rights not explicitly granted to the federal government—such as gambling regulation. While the primarily legal challenge to the law came from New Jersey, other efforts to overturn it had been set in motion before the Supreme Court's decision in May 2018; this included a sports-betting bill being introduced in Kentucky^[4], as well as the other states who are in the process of creating and or passing some form of sports betting legislation and the formation of the pro-repeal American Sports Betting Coalition, a lobby alliance which includes the American Gaming Association and the National Indian Gaming Association.^[5]

PASPA was formally challenged in the state of New Jersey. In March 2009, New Jersey State Senator Raymond Lesniak filed a lawsuit in the United States District Court for the District of New Jersey claiming, among other things, that the PASPA unconstitutionally discriminated among the states by allowing four states to offer sports betting while disallowing the other forty-six states from enjoying the privilege; however the case was dismissed as the court argued that only then-Governor Chris Christie could bring the suit, and at that time, Christie believed it would be difficult to challenge the law.^[6] A 2010 referendum showed overwhelming support by state voters to legalize sports gambling,^[7] and by 2012, the state passed a law that would allow for sports gambling at licensed locations.^[8] This law was challenged by the National Collegiate Athletic Association, the National Basketball Association, the National Football League, the National Hockey League, and Major League Baseball in August 2012, arguing their new law violated PASPA.^[9] The state argued that they knew their law likely violated PASPA, but argued that PASPA itself violated the Tenth Amendment's protection against anti-commandeering federal laws that stripped the power of the state to repeal their own sports gambling ban.^[10] This case, heard in the United States District Court for the District of New Jersey, found for the sports leagues, dismissing the state's claims regarding PASPA.^[11] New Jersey appealed the decision. On September 17, 2013, the Third Circuit Court of Appeals, in a decision by Judge Julio M. Fuentes, found for the sports leagues, again ruling that the state law violated PASPA and enjoined the state from enacting the law.^[12] However, the Appeals Court also ruled that PASPA did not prevent New Jersey from repealing any existing laws it had.^[13]

Based on the Appeal Court's comment, New Jersey, now with Governor Christie's blessing, passed a new law in 2014 that repealed a former state law that banned sports gambling.^[13] The four leagues and the NCAA filed suite against this new law, again arguing that it violated PASPA. The leagues and the NCAA prevailed both at District Court and at an en banc decisions from the Third Circuit by August 2016, leading the state to petition the Supreme Court of the United States to hear the case.^[14] New Jersey appealed this case to the United States Supreme Court, requesting examination of PASPA under the anti-commandeering provisions of the Tenth Amendment.^[15]

The Supreme Court accepted the case in June 2017^[16] and heard oral arguments in December 2017;^[17] during this time, Governor Christie stepped down and was replaced by Phil Murphy; the case before the court became Murphy v. National Collegiate Athletic Association. The case was combined with a separate petition NJ Thoroughbred Horsemen v. NCAA, representing commercial interests related to PASPA. The Court ruled in May 2018 in a 7-2 decision that parts of PASPA were unconstitutional as they commandeered power from the states, and in a 6-3 decision, determined that the whole of PASPA was unconstitutional.^[18][19]

References[edit]

1. ^Lambert, Troy (July 18, 2017). 'Supreme Gamble: The Professional and Amateur Sports Protection Act'. Huffington Post.
2. ^Rodefer, Jeffrey (March 5, 2007). 'Sports Protection Act'. gambling-law-us.com. Retrieved July 24, 2017.
3. ^Johnson, Brent (October 17, 2014). 'Christie signs law allowing sports betting in N.J.'The Star-Ledger. Retrieved July 24, 2017.
4. ^'New Kentucky Bill Would Legalize Sports Betting In Bluegrass State'. Legal Sports Report. September 20, 2017. Retrieved October 24, 2017.
5. ^'Tribal, Commercial Casino Alliance On Sports Betting Gains Momentum'. Legal Sports Report. September 25, 2017. Retrieved October 24, 2017.
6. ^Spoto, MaryAnn (September 25, 2011). 'Casino, horse racing leaders push for legalization of sports betting in N.J.'The Star-Ledger. Retrieved March 16, 2018.
7. ^Spoto, MaryAnn (November 8, 2011). 'Sports betting backed by N.J. voters'. The Star-Ledger. Retrieved March 16, 2018.
8. ^Friedman, Matt (January 17, 2012). 'Gov. Christie signs bill allowing gamblers to place bets on pro, college sports teams'. The Star-Ledger. Retrieved March 16, 2018.
9. ^Heitner, Darren (August 7, 2012). 'Constitutionality Of Sports Betting Prohibition At Issue In NCAA And Professional Leagues' Lawsuit Against New Jersey'. Forbes. Retrieved July 24, 2017.
10. ^Schamis, Axel; Van Bramer, Katherine. 'Christie v. National Collegiate Athletic Association'. Legal Information Institute. Retrieved March 18, 2018.
11. ^Drape, Joe (March 27, 2013). 'Cash-Hungry States Eye Sports Betting, to Leagues' Dismay'. The New York Times. Retrieved July 24, 2017.
12. ^'Appeals Court Upholds Constitutionality Of New Jersey Sports Betting Ban'. United States Department of Justice. September 17, 2013. Retrieved July 24, 2017.
13. ^ ^abPurdum, David; Rodenberg, Ryan (March 3, 2018). 'The odds of legalized sports betting: New Jersey vs. the leagues'. ESPN. Retrieved March 16, 2018.
14. ^Johnson, Brent; Salant, Jonathan (August 9, 2016). 'N.J. loses again in quest to bring sports betting to state'. The Star-Ledger. Retrieved July 23, 2017.
15. ^'Christie v. National Collegiate Athletic Association'. SCOTUSblog. Retrieved July 26, 2017.
16. ^Johnson, Brent; Salant, Jonathan (June 28, 2017). 'U.S. Supreme Court agrees to hear N.J. sports betting case'. The Star-Ledger. Retrieved July 22, 2017.
17. ^'The NJ Sports Betting Case Gets Its Day In SCOTUS: What We Learned'. Legal Sports Report. December 4, 2017. Retrieved December 5, 2017.
18. ^Purdum, David (May 14, 2018). 'Supreme Court strikes down sports betting law'. ESPN. Retrieved May 14, 2018.
19. ^Maese, Rick (May 14, 2018). 'Analysis What the Supreme Court's sports gambling decision means'. The Washington Post. ISSN0190-8286. Retrieved May 14, 2018.

External links[edit]

• Opinion for Murphy v. National Collegiate Athletic Assn. (16-476) from SupremeCourt.gov
• Professional and Amateur Sports Protection Act of 1992, Chuck Humphrey, Gambling Law US

There is a lot of hype surrounding the gambling industry in the United States, specifically the online gambling industry. In recent years, there has been an increasing demand for online gambling options, forcing states to amend their gambling legislation one way or another. The demand has also forced the Federal government to look at US online gambling laws and how they should be applied.

The gambling debate is split, with some states supporting it while others are opposed. This divide has driven a lot of players to offshore gambling sites, though potential bettors and gamblers have many legal questions about this market. All the state-based and federal laws regarding domestic gambling and offshore gambling can become convoluted, leading to confusion and misconceptions over what is allowed and what isn’t.

Using this site as a resource, you will be able to obtain insight concerning the various state and federal laws surrounding US online gambling and offshore gambling. The important thing to ensure when participating in any form of online gambling is that you are engaging in legitimate and legal activity. If you are properly informed on the legalities of online gambling, whether domestic or offshore, you can make informed decisions and remain within the legal confines of the industry, allowing you to participate in gambling entertainment with peace of mind. This is actually the most critical element to understanding legal offshore gambling opportunities.

Is It Legal For US Residents To Gamble Online At Offshore Gambling Sites?

For the most part, yes. As of now, there are no US federal laws that ban American bettors from placing bets with legal offshore gambling sites as long as they are legitimately licensed and regulated in their home countries.

The federal laws that apply to online gambling and sports betting will be explained in further detail in the next section.

That said, at the state level, there are two states that include language in their gambling legislation that could apply to offshore sites. These are Washington and Connecticut. We urge all interested bettors to comply with the gambling laws in their states and to be highly selective when choosing any destination – either domestic or offshore – at which to gamble.

Unlawful Internet Gambling Enforcement Act—UIGEA

Contrary to popular belief, the scary-sounding Unlawful Internet Gambling Enforcement Act (2006) does not apply to individual bettors or even to placing bets online. The UIGEA strictly deals with US-based banks and other financial institutions that knowingly process transactions associated with unregulated gambling.

Upon first glance, many believe this law means that US bettors cannot place any type of bet online or participate in any form of online gambling, but that is simply not the case.

Our page on the Unlawful Internet Gambling Enforcement Act explains the law in further detail. This includes how the law affects online gambling (from a player and industry standpoint), how the industry has reacted to it, and what it means for American bettors looking to interact with offshore gambling sites.

Federal Wire Act of 1961

The Federal Wire Act (aka the Interstate Wire Act) was passed in a time where the gambling landscape was quite different than it is now. Passed under President John F. Kennedy, the Wire Act aimed to clean up the industry, which at the time was heavily influenced by organized crime syndicates.

The law pertains to using wire transmissions (and now, the Internet) for sending and receiving gambling information. This definition has been debated as to whether it encompasses all forms of online gambling. The Department of Justice issued a formal opinion in 2011 that limited the law to sports wagering, though this was overturned in a DOJ opinion in 2019 that claimed it applied to all forms of gambling. That, in turn, was promptly overturned by a federal judge, and the Wire Act is now back to being a sports-betting-only regulation.

While the Federal Wire Act does prohibit all US-based sportsbooks from accepting wagers across state lines (whether brick-and-mortar or online), it does not have any bearing on legal offshore sports betting sites, nor does it criminalize individuals from placing wagers of any kind. The regulation applies exclusively to domestic sportsbook operators. There is more information on our page explaining the Federal Wire Act in greater detail.

Professional and Amateur Sports Protection Act—PASPA

The Professional and Amateur Sports Protection Act was the overarching federal law governing sports betting in the US. Passed in 1992, PASPA banned 46 states from having any type of state-sponsored sports betting, including physical and online sportsbooks. Realistically, it gave Nevada a monopoly on sports betting, as the other exempted states were not able to offer single-game wagering.

In roughly 2012, New Jersey initiated a series of legal challenges as to the constitutionality of PASPA, and on May 14, 2018, the case was finally heard by the US Supreme Court. PASPA was overturned in a 6-2 vote (with one abstention), allowing each state to install and regulate its own sports betting industries. The case in question is Murphy v. NCAA.

Our page on the Professional and Amateur Sports Protection Act goes more into detail on why the law was passed, the specific ramifications of it, and how it was finally overturned as a violation of the 10th Amendment.

USA Offshore Gambling Laws FAQs

How Do US Federal Laws Affect The Gambling Industry In The US?

The two federal laws that impact the American gambling industry as a whole are the Interstate Wire Act and the UIGEA. While PASPA was the the most restrictive anti-gambling law, that has been overturned by the SCOTUS and is no longer in effect.

Fortunately, the Wire Act and UIGEA are rendered moot by legal offshore gambling sites where they have no jurisdiction, and since neither law affects individual gamblers in any way, it is safe to wager real money with these overseas betting operators. The advent of Bitcoin in particular has obviated the UIGEA to the point of irrelevancy.

Is It Legal For Me To Use Offshore Gambling Sites?

Excepting Washington and Connecticut residents, it is perfectly legal for Americans to enjoy offshore gambling sites as long as the site at which they are betting is legally sanctioned and regulated outside of the United States. There are numerous offshore gambling sites online, so we urge American bettors to consider input from industry professionals as a way to vet the sites they are interested in.

The team that created this resource guide have more than 30 years of experience in the industry and have determined which sites are safe to use and provide legal, high-quality gambling experiences. There are no US federal laws that make betting with offshore gambling sites illegal as long as they meet the criteria mentioned above.

Federal Law Regarding Sports Gambling Losses

What Should You Look For In An Offshore Gambling Site?

When determining which offshore gambling site to use, there are several things to consider. First, you should verify that they are legally sanctioned and possess all the necessary licensing and certifications to operate. If the site has these, they should make the documentation readily available. Also, you should pay attention to their security protocols to make sure your personal and financial information is kept safe.

The next thing to look out for is the quality of their betting services, software performance, banking suites, and customer care options. Most reputable offshore gambling sites will also have bonuses and promotions available.

Federal Law Regarding Sports Gambling Winnings

Online gambling sites span various markets, including legal offshore casinos, sportsbooks and poker rooms, as well as racing, bingo, lottery and many others. Each group has its own policies, rules, bonuses, etc. Any reputable site will use audited, certified RNG (Random Number Generator) technology for their casinos and poker rooms to ensure fair play.

Legal licensing and regulation from respected governing jurisdictions means that these sites are held accountable and have to maintain high standards. Reputable offshore gambling sites want to keep their level of credibility within the industry, so they will comply with standards set out by gambling authorities and watchdog agencies.

Federal Law On Sports Gambling

Will There Be Any State Licensed Online Gambling Options In The Near Future?

Federal Law Regarding Sports Gambling Rules

Some states already have some forms of state sanctioned online casino or poker gambling, including Nevada, New Jersey, Pennsylvania, and Delaware. West Virginia is able to offer online casino gaming but has not yet done so.

Federal Law Regarding Sports Gambling Laws

A number of other states are currently involved in discussions about the possibility of state regulated online gambling legalization. US states currently possess the authority to legalize online casinos, poker rooms, sportsbooks, pari-mutel wagering (i.e. horse racing betting), bingo, and lottery games. With the proliferation of legal sports betting since the overturn of PASPA, however, we expect more states to offer full online casino action in the near future.