• Starting in June 2010, the Unlawful Internet Gambling Enforcement Act goes into effect
  • Millions of Americans play poker online, and mostly for money
  • Some internet sites make millions of dollars on poker
  • It's unclear, though, whether the new law applies to online poker
  • Know how to protect yourself if the law hits the cyber poker tables
 


A new law targeting online gambling operations goes into effect in 2010. The question is: Does it apply to the multi-million dollar online poker industry? The short answer: No one's sure.

The Law

The Unlawful Internet Gambling Enforcement Act (UIGEA) was passed in 2006 as part of the "Safe Port Act." However, the main part of the law didn't go into effect immediately, rather it becomes effective on June 1, 2010.

So, what's the law supposed to do? It's meant to shut-down illegal online gambling operations - both inside and outside the US. It does this by:

  • Barring internet gambling "operators" from accepting money from bettors in connection with any online gambling that's illegal under state or federal law. This means taking money by cash, check, credit card, and electronic fund transfer (ETF)
  • Requiring banks and other financial institutions to develop and follow policies and procedures to help stop the flow of money from bettors to illegal online gambling operations (this is the part of the law that becomes effective in June 2010)
  • Giving the federal attorney general, as well as each state's attorney general, the ability to file criminal and civil actions to enforce the UIGEA. Civil actions might include forcing a website to shut down or cutting its access to the internet. Criminal punishments include fines and up to five years in prison

The UIGEA does not make it illegal for you or me to place a bet or gamble online. Rather, it makes it illegal for the online game operator or website to take our money on the bet.

In general, the UIGEA bans online gambling if the bet or wager involves chance, rather than skill, and if the bet is illegal under federal law or the laws of the state where the bet is made or received. Good examples are sporting events and typical "casino games," like roulette and craps.

There are exceptions, though. In addition to Nevada, many states allow some form of online and in-person gambling for money, such as playing a state-run lottery and betting on horse and dog racing. And, if no money is involved, it's perfectly legal in all states to simply play a game of poker, dice, or whatever.

Nonetheless, even if you don't violate the UIGEA by gambling for money, you could be breaking the laws in your state, meaning you could be fined, sent to jail, or both, depending on the laws in your state.

Poker?

Online poker is a multi-billion dollar industry. As of 2009, 10 million people in the US gamble real money playing poker online. Gambling operators such as PokerStars, Full Tilt Poker, and others make millions of dollars each year on bets made from the US and other countries around the world.

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Tagged as: Internet Law, online poker, internet law lawyer