During the 1990s, online gambling became a popular method of placing bets. It appeared to be an end run around government control. But state officials were concerned that the Internet would allow illegal gambling to move into their jurisdictions. In response, Congress investigated online gambling regulations.
The United States has a few different laws that apply to Internet gambling. These laws include the Gambling Act and the Wire Act. Both laws provide penalties for illegal Internet gambling.
The Gambling Act makes it illegal for any person to bet on a sporting event or contest without first receiving a prize. The Wire Act provides a criminal penalty for operators of wagering businesses.
The Internet Gambling Regulation and Tax Enforcement Act would regulate and tax internet gambling businesses. It would also require Internet gambling businesses to obtain a license. The bill also includes provisions for data security.
Some states have begun to legalize online gambling. However, others have not. Several bills have been introduced in the House to make it easier for states to regulate Internet gambling.
The Department of Justice has asserted that all online gambling is illegal. However, the issue has been a contentious one on constitutional grounds. Some have raised the issue of the Commerce Clause.
The dormant Commerce Clause doctrine theorizes that state laws that apply to commerce outside of state borders are unconstitutional. While these attacks have not produced much success, it does raise a question about whether legislative power under the Commerce Clause can be limited.