During the past half-century various laws prohibiting sports betting in the United States have been enacted; among them The Federal Wire Act Law, The Professional and Amateur Sports Protection Act (PASPA) and the Unlawful Internet Gambling Enforcement Act (UIGEA).
The Federal Wire Act (or Interstate Wire Act of 1961 as it was officially called) is the oldest of the three and the UIGEA (Unlawful Internet Gambling Enforcement Act) the newest. It was signed into law by President Bush as recently as October 13, 2006.
But it is the PASPA Law, enacted in 1992, that has mostly been responsible for the absence of sports betting in all but four of the US’s 50 states during the past quarter Century.
Here we look at the effect these laws have had or are having on sports wagering in the United States – and especially at the end result of the recent decision taken by the Supreme Court to scrap the PASPA Law.
Because of its greater significance and the Sportsbook Rush into New Jersey that has resulted from its demise, we look first at the PASPA Law.
The PASPA Law
For some unknown reason, Sports Fantasy gaming has not fallen foul of any US anti-sports betting laws and has thrived, notably in New Jersey where juggernaut operators with millions of players like DraftKings and FanDuel have paid out billions of Dollars in ‘prize money’.
And all this at a moment in history when the age-old practice of making wagers with bookmakers on horse races was rapidly spreading into many human-based forms of sport in other parts of the world, notably in Great Britain, home of many modern forms of sport, continental Europe, Australia, Asia, and Africa.
Partly because its authorities, it has been suggested, were unhappy at missing out on the large sums of tax money being earned by Nevada from sports betting, New Jersey took PASDA to court and after a three-year, see-saw battle, eventually saw the Supreme Court throw out the Act on May 14, 2018, on the grounds that it was unconstitutional.
Very quickly after that, New Jersey took advantage of the court’s decision, opened the way to sports betting under its own set of laws and a month later became the first state of the 46 previously not exempts to make sports betting legal – except in the case of high school and College gridiron football and basketball.
Many more US states right now are in the process of joining New Jersey in legalizing sports betting and at the time of writing, Pennsylvania, West Virginia, Rhode Island, and New York were reported to be those closest to getting there.
New Jersey’s new gambling laws stipulate that you must be 21 and older to participate in sports betting and with a few exceptions where 18 may be established as the stipulated minimum age, most other states are also expected to set an age limit of 21.
When registering in New Jersey right now (and this could be the norm when sports betting becomes legal in other states), sports bookmakers will ask you to confirm your age and identity using ID and/or Driver’s license info and photos. If they don’t, stay away. They are sure to be dodgy.
If they do, make sure you strictly conform to the age restrictions of the state in question. If you don’t you might find that being underage will legally prevent you from withdrawing your winnings.
Right now the sportsbooks that have been launched in New Jersey allow members to register and to deposit and withdraw funds from their sportsbook accounts from both inside and outside of the state’s borders, but at this stage, it is against the law to actually place bets from outside of the state.
If you do attempt to do so, G-tracking will pick it up and you are likely to be warned in a screen pop-up that what you are attempting to do is illegal and that you will be penalized if you persist in trying to do so.
Federal wire act of 1961
The Federal Wire Act of 1961 was essentially brought into being in an attempt to disrupt the activities of gangsters who were using wire and phone services to conduct illegal sports gambling activities.This was before the advent of the internet and this has created some later-day confusion and two different points of view as to whether or not the Wire Act Law can be applied to online gaming.What it doesn’t do, however, is to restrict legal sportsbooks from operating online inside the states where they are licensed and regulated.Nor does it have any impact on offshore sportsbook operators which fall outside of its jurisdiction.
The UIGEA Law
The latest Federal law in the US which can affect sports gambling on the Internet is the Unlawful Internet Gambling Enforcement Act or UIGEA.
The Security and Accountability for Every Port Act of 2006 (SAFE Port Act) was passed by Congress and signed into law by President Bush on October 13 of that year.
Originally created to enhance port security throughout the United States, the SAFE Act included a last-minute rider; Title VIII.
This is the UIGEA law that keeps US gambling businesses from “knowingly accepting payments” for bets and wagers over the Internet that are “unlawful under any federal or state law.”
Sections 5363 and 5366 of UIGEA “criminalize the acceptance of funds” by operators of almost all gambling websites – and the law does not restrict itself to simply US-based businesses, and attempts to regulate non-US businesses as well.
The World Trade Organization (WTO) argued on behalf of Antigua, however, that US gambling legislation could not govern countries which fall outside of US law.
Antigua sued the United States for $3.4 billion in trade sanctioning because of money lost in its online sports betting and gambling industries due to UIGEA enforcement and the US lost the legal battle.
State Sports Betting Laws
Summing up the US betting law situation as it stands in late 2018, we must underline the fact that states that join Nevada, Delaware, and New Jersey and allow sports betting to flourish will be entitled to come up with their own set of rules that best suit the culture of the population they govern – as long as their local laws conform to the Federal Laws.
It’s very possible then, that when the dust from the Paspa implosion has settled, the sports betting laws governing each individual state could differ greatly and it will, therefore, be crucial that sports-betting gamers get themselves clued-up on the gambling laws that apply in their particular neck of the woods.
Under the Federal Laws, could and will most likely differ depending on the needs and requirements of their citizens.