DOJ Issues Reversal: Wire Act to Prohibit All Online Gambling

The Department of Justice (DOJ) has released an official revised opinion articulating its stance on the application of the Wire Act. The opinion threatens to have sweeping effects on the online gambling industry, potentially prohibiting all online wagering, not just online sports betting.

The Wire Act, put into effect in 1961, was originally strategized by Congress as a way to crack down on underground sports betting and to subsequently reduce organize crime. The Act made it a federal offense to take sports bets through a “wire communication facility.” In 1961, “wire communication facilities” were thought to mean the telephone and its accessories. Of course, the meaning of this term would tremendously expand with the rise of the internet in the late 1990s and early 2000s, as online poker and online casinos began entrenching themselves in the gambling industry.

In 2011, the Department of Justice issued an opinion stating that the Wire Act only made internet gambling on sports illegal. Thus, online casino, poker, or lottery games were not illegal under the Act. However, as of January 2019, the DOJ has revised their stance, now stating that the Wire Act applies to all bets and wagers.

It is important to note that the opinion is not the law itself. It is instead a guide to how the DOJ plans to enforce federal law. Further, the Attorney General has issued a statement that no new actions will be taken by the DOJ on the basis of the revised opinion until at least April 14, 2019, 90 days from the revised opinion’s release.

It will then be up to the courts to decide how the Wire Act will apply to online, non-sports betting. Daniel L. Wallach of Wallach, co-founding director of the University of New Hampshire School of Law’s Sports Wagering and Integrity Program explains, “The opinion acknowledges that the decision will likely be tested judicially. I think we could be headed toward the next big gambling case that reaches the Supreme Court, or at the very minimum, the U.S. Court of Appeals.”

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