Online gambling is a form of gambling, including sports betting and casinos, which takes place over the Internet. There are many types of online gambling sites, each offering different games. Some of them provide free play and bonuses. Others, however, require users to deposit real money. In either case, online casinos are operated 24 hours a day. These games can be played on any computer or mobile device that has an Internet connection. Most sites use industry-standard 128-bit encryption to ensure security.
Gambling activities are prohibited by the Unlawful Internet Gambling Enforcement Act (UIGEA) and other federal laws, such as the Wire Act. However, some state officials have expressed concern that the Internet can be used to illegally bring gambling activities into their jurisdictions. In such cases, the U.S. Marshals seized more than $3.2 million from a gambling operation in Costa Rica. A number of states have passed legislation prohibiting online gambling. Other states, such as New York and California, have enacted laws requiring people to be a member of the local bar to participate in a casino game.
In addition to the criminal aspects of gambling activities, there are several constitutional issues to consider. In particular, the Due Process Clause has been a source of contention. The Commerce Clause has also raised questions. Because of this, the state level of law and the federal law of enforcing gambling laws are sometimes in conflict. There is no clear-cut answer to the question of whether a gambling activity, even if conducted over the Internet, violates the Due Process Clause.
The federal law has been reinforced in cases where the enforcing authority is challenged on constitutional grounds. In particular, Section 1956 of the U.S. Code has created several crimes related to illegal Internet gambling. These crimes include laundering for international purposes, laundering with intent to promote illicit activity, and laundering to conceal the origin of funds.
One example is United States v. Nicolaou, a 4th Circuit case. In that case, the Government brought a criminal indictment against five people who had made a total of $2000 in illegal wagers in a single day. The prosecution charged them with operating a virtual casino and gaming establishment, even though the activities occurred in a different state than the defendants. The Federal Communications Commission, which is responsible for maintaining facilities, may discontinue providing and leasing them.
The Lopez Amendment, a Congressionally-mandated bill, includes elements designed to weed out low-level gambling cases. For instance, it establishes a Congressional investigation of the impact of gambling on interstate commerce. This may be useful in the event that the state-level gambling laws are in conflict with the federal law. The Lopez Amendment will also allow the Gambling Supervision Commission to terminate a license if the company is engaged in unlawful gambling.
Another issue that has arisen in cases involving online gambling is the application of the Travel Act. The Travel Act prohibits illegal gambling on interstate commerce. The Wire Act also prohibits illegal gambling on contests and sporting events.