During the late 1990s, the Internet was a new phenomenon and gambling became the new way to wager money. The advent of the Internet created opportunities for gambling companies to advertise to customers. The new business model allowed them to offer a variety of games and make money because the odds were in their favor. Online gambling has become a very profitable industry, with revenue over C$50 billion estimated. However, some countries are not so fortunate and have banned the activity altogether. The laws governing online gambling vary greatly from country to country.
Laws regarding gambling generally fall under the jurisdiction of state law. Some states have enacted legislation making gambling illegal, while others have not. Nevertheless, online gambling has a reputation for being illegal, and state officials have expressed concerns that the Internet can be used to bring illegal gambling into their jurisdiction. Some states have also introduced legislation that would prohibit certain activities associated with online gambling, such as accepting deposits or making bets.
A federal law known as the Unlawful Internet Gambling Enforcement Act (UIGEA) has been used to prosecute people who are engaging in Internet gambling. The statute has been used to accuse the owners of three of the largest online poker companies of illegal activity, including money laundering, fraud, and money laundering for international purposes. The government also seized $3.2 million from Discovery Communications, who had been promoting a gambling website called Tropical Paradise.
The law also makes it illegal for any person to advertise online gambling services, which could be seen as aiding and abetting illegal activity. It also states that the director of the Financial Crimes Enforcement Network (FCE) must license Internet gambling facilities. In addition, the Federal Information Technology Rules have been designed to prevent illegal gambling activities from taking place on the Internet.
The UIGEA is only one of several federal criminal statutes that have been used to prosecute illegal Internet gambling. Other laws include the Wire Act, which prohibits the transmission of bets and wagers between locations, and the Money Laundering Control Act (MLCA). In addition, some states have passed their own laws regarding online gambling, and other states are also considering the issue.
In 1999, a bill was introduced in the US Senate called the Internet Gambling Prohibition Act (IGPA), which would have prohibited U.S. citizens from participating in any form of online gambling. In addition, it would have required licensing of Internet gambling facilities, as well as age verification and location verification. In response, Congressman Barney Frank introduced a bill in April 2007 called HR 2046, or the Internet Gambling Regulation, Consumer Protection, and Enforcement Act. The bill would have regulated online gambling activities, except for horse racing. It would also have modified the UIGEA to allow the government to prohibit payment processors from processing money related to illegal Internet bets.
The law’s provisions also create a number of crimes, including laundering for international purposes, concealing or laundering money for an illegal purpose, and laundering for law enforcement stings. These crimes, which have been criticized on constitutional grounds, have raised the question of whether the statute is a violation of the Commerce Clause of the Constitution.