Online gambling
Encyclopedia
Online gambling, also known as Internet gambling and iGambling, is a general term for gambling
using the Internet
.
tables commonly offer Texas hold 'em
, Omaha, Seven-card stud
, razz, HORSE
and other game types in both tournament
and ring game
structures. Players play against each other rather than the "house", with the card room making its money through "rake
" and through tournament fees.
s, in which people can play casino games such as roulette
, blackjack
, pachinko
, baccarat
and many others. These games are played against the "house", which makes money due to the fact that the odds are in its favor.
s, spread betting
firms and betting exchanges
offer a variety of ways to wager over the Internet on the results of sporting events
, the most popular being fixed-odds gambling
.
are run by governments and are heavily protected from competition due to their ability to generate large taxable cash flows. The first online lotteries were run by private individuals or companies and licensed to operate by small countries. Most private online lotteries have stopped trading as governments have passed new laws giving themselves and their own lotteries greater protection. Government controlled lotteries now offer their games online.
betting comprises a significant percentage of online gambling wagers and all major Internet bookmakers, betting exchanges, and sports books offer a wide variety of horse racing betting markets
or debit card
, and cash out winnings directly back to the card; most U.S.
banks, however, prohibit the use of their cards for the purpose of Internet gambling, and attempts by Americans to use credit cards at Internet gambling sites are usually rejected. A number of electronic money
services offer accounts with which online gambling can be funded; however, many top fund-transfer sites such as FirePay, Neteller & Moneybookers
have discontinued service for U.S. residents.
Payment by cheque
and wire transfer
is also common.
, which licenses Internet gambling entities, made a complaint to the World Trade Organization
about the U.S. government's actions to impede online gaming. The Caribbean country won the preliminary ruling but WTO's appeals body somewhat narrowed that favorable ruling in April 2005. The appeals decision held that various state laws argued by Antigua and Barbuda to be contrary to the WTO agreements were not sufficiently discussed during the course of the proceedings to be properly assessed by the panel. However, the appeals panel also ruled that the Wire Act and two other federal statutes prohibiting the provision of gambling services from Antigua to the United States
violated the WTO's General Agreement on Trade in Services
, or "GATS". Although the United States convinced the appeals panel that these laws were "necessary" to protect public health and morals, the asserted United States defense on these grounds was ultimately rejected because its laws relating to remote gambling on horse-racing were not applied equally to foreign and domestic online betting companies, and thus the United States could not establish that its laws were non-discriminatory.
On March 30, 2007, the WTO confirmed the U.S. "had done nothing to abide by an earlier verdict that labeled some U.S. Internet gambling restrictions as illegal."
On June 19, 2007, Antigua and Barbuda filed a claim with the WTO for USD $3.4 billion in trade sanctions against the United States, along with a request for authorization to ignore U.S. patent and copyright laws. This followed by a day similar demands for compensation made by the European Union
.
Many of the companies operating out of Antigua are publicly traded on various stock exchanges, specifically the London Stock Exchange
. Antigua has met British regulatory standards and has been added to the UK's “white list”, which allows licensed Antiguan companies to advertise in the UK.
2001 (IGA). The government said that the IGA was important to protect Australians from the harmful effects of gambling.
The IGA targets the providers of interactive gambling services. The IGA makes it an offence to provide an interactive gambling service to a customer physically present in Australia, but it is not an offence for Australian residents to play poker or casino games online. In stark contrast to the USA, sports betting online is also completely legal in Australia, with many state government licensed sportsbooks in operation, such as Centrebet
, Sportingbet
& Betfair
.
The offense applies to all interactive gambling service providers, whether based in Australia or offshore, whether Australian or foreign owned.
proposed new laws to regulate and tax Internet gambling. Budget minister Eric Woerth stated the French gambling market would expand to adapt to "Internet reality." He further stated "Rather than banning 25,000 websites, we'd rather give licenses to those who will respect public and social order." The new regulations are expected to take effect in June 2010. Betting exchanges, however, will remain illegal under the new plans.
has to be liberalised. Schleswig-Holstein is the only German state that has already come up with their own gambling bill allowing gambling online. From 2012, casino operators can apply for an online gambling license in this state.
.
gambling law (Israeli Penal Law 5737 - 1977) does not refer specifically to online gambling (land based gambling and playing games of chances is prohibited except in the cases of the Israel Lottery and the Israeli Commission for Sports Gambling). In December 2005, the Attorney General ordered all online gambling operations, online backgammon
included, to close their businesses and at the same time commanded credit card companies to cease cooperating with online gambling websites. In May 2007, the Attorney General had excluded the online backgammon website Play65
of the ruling, due to "the unique circumstances of the site activity", allowing to return to full activity in Israel.
n legislation, enacted in December 2006, prohibits online gambling altogether (as well as any gambling relying on telecommunications technology).
ruled in November 2002 that the Federal Wire Act
prohibits electronic transmission of information for sports betting across telecommunications lines but affirmed a lower court ruling that the Wire Act "'in plain language' does not prohibit Internet gambling on a game of chance." But the federal Department of Justice continues, publicly, to take the position that the Wire Act covers all forms of gambling.
Online gambling, which was once illegal in all but two states, is now accepted by most states, though some states have specific laws against online gambling of any kind. In addition, owning an online gaming operation without proper licensing is illegal, and no states currently grant online gaming licenses. Despite this, online gambling now generates more than $60 billion in revenue for the United States.
In March 2003, Deputy Assistant Attorney General John G. Malcolm testified before the Senate Banking Committee regarding the special problems presented by online gambling. A major concern of the United States Department of Justice
is online money laundering
. The anonymous nature of the Internet and the use of encryption make it especially difficult to trace online money laundering transactions.
In April 2004 Google
and Yahoo!
, the two largest Internet search engines, announced that they were removing online gambling advertising from their sites. The move followed a United States Department of Justice announcement that, in what some say is a contradiction of the Appeals Court ruling, the Wire Act relating to telephone betting applies to all forms of Internet gambling, and that any advertising of such gambling "may" be deemed as aiding and abetting. Critics of the Justice Department's move say that it has no legal basis for pressuring companies to remove advertisements and that the advertisements are protected by the First Amendment
. In April 2005, Yahoo! has instigated a restrictive policy about gambling ads.
In August 2004, Casino City, an online portal for Internet gambling sites, sued the U.S. Department of Justice. The complaint alleged, inter alia, that the website's business—promoting Internet gambling—was legal, and requested a declaration from the court that its business was protected by the First Amendment. The U.S. District Court for the Middle District of Louisiana dismissed the case in February 2005.
In its opinion, the District Court wrote,
The U.S. Court of Appeals, 5th Circuit, dismissed Casino City's appeal in January, 2006.
In February 2005 the North Dakota
House of Representatives passed a bill to legalize and regulate online poker and online poker cardroom operators in the state. Testifying before the State Senate, Nigel Payne, CEO of Paradise Poker
, pledged to relocate to the state if the bill became law. However, the measure was defeated by the State Senate in March 2005. Rep. Jim Kasper, who sponsored the 2005 legislation, planned to introduce similar bills in the 2007 North Dakota legislative session.
In July 2006, David Carruthers
, the CEO of BetonSports
, a company publicly traded on the London Stock Exchange
, was detained in Texas while changing planes on his way from London to Costa Rica. He and ten other individuals had been previously charged in a sealed indictment with violations of US federal laws relating to illegal gambling. While as noted above, a United States Appeals court has stated that the Wire Act does not apply to non-sports betting, the Supreme Court of the United States
previously refused to hear an appeal of the conviction of Jay Cohen
, where lower courts held that the Wire Act does make it illegal to own a sports betting operation that offers such betting to United States citizens.
The BetOnSports indictment alleged violations of at least nine different federal statutes, including 18 USC Sec. 1953 (Operation of an Illegal Gambling Business). Carruthers is currently under house arrest on a one million dollar bail bond.
In September 2006, Sportingbet
reported that its chairman, Peter Dicks
, was detained in New York City on a Louisiana warrant while traveling in the United States on business unrelated to online gaming. Louisiana is one of the few states that has a specific law prohibiting gambling online. At the end of the month, New York dismissed the Louisiana warrant.
Also in September 2006, just before adjourning for the midterm elections, both the House of Representatives and Senate passed the Unlawful Internet Gambling Enforcement Act of 2006
(as a section of the unrelated SAFE Port Act
) to make transactions from banks or similar institutions to online gambling sites illegal. This differed from a previous bill passed only by the House that expanded the scope of the Wire Act. The passed bill only addressed banking issues. The Act was signed into law on October 13, 2006, by President George W. Bush
. At the UIGEA bill-signing ceremony, Bush did not mention the Internet gambling measure, which was supported by the National Football League
but opposed by banking groups.
In response to Unlawful Internet Gambling Enforcement Act, a number of online gambling operators including PartyGaming
, Bwin, Cassava Enterprises
, and Sportingbet
announced that real-money gambling operations would be suspended for U.S. customers. PartyGaming's stock dropped by 60% following its announcement. Other operators such as PokerStars
, Full Tilt Poker
, Bodog
, and World Sports Exchange
announced their intention to continue serving customers in the U.S.
The regulation called for in the UIGEA were issued in November 2008. The regulation does not define "unlawful Internet gambling."
On April 26, 2007, Rep. Barney Frank
(D-MA) introduced HR 2046, the Internet Gambling Regulation, Consumer Protection, and Enforcement Act
, which would modify UIGEA by providing a provision for licensing of Internet gambling facilities by the Director of the Financial Crimes Enforcement Network.
On June 7, 2007, Rep. Robert Wexler
(D-FL) introduced HR 2610, the Skill Game Protection Act, which would legalize Internet poker, bridge, chess, and other games of skill. Also on June 7, Rep. Jim McDermott
(D-WA) introduced H.R. 2607, the Internet Gambling Regulation and Tax Enforcement Act. IGRTEA would legislate Internet gambling tax collection requirements.
On June 8, 2007, the House Financial Services Committee, chaired by Barney Frank, held a hearing entitled, "Can Internet Gambling Be Effectively Regulated to Protect Consumers and the Payments System?". Expert witnesses at the hearing testified that Internet gambling can be effectively regulated for age verification, money laundering issues, facilitation of state and federal tax collection, and for issues relating to compulsive gambling.
On September 26, 2008, Sen. Robert Menendez
(D-NJ) introduced S.3616, the Internet Skill Game Licensing and Control Act. This bill would amend title 31, United States Code, to provide for the licensing of Internet skill game facilities, and for other purposes. This is the first bill related to online skill games that has been introduced in the Senate.
On May 6, 2009, Rep. Barney Frank (D-MA), re-introduced the Internet Gambling Regulation, Consumer Protection, and Enforcement Act
(H.R. 2267). The legislation would establish a framework to permit licensed gambling operators to accept wagers from individuals in the U.S. and mandates a number of significant consumer protections, including safeguards against compulsive and underage gambling, money laundering, fraud and identify theft. Additional provisions in the legislation reinforce the rights of each state to determine whether to allow Internet gambling activity for people accessing the Internet within the state and to apply other restrictions on the activity as determined necessary. The legislation also would allow states and Native American tribes with experience in regulating gambling to play a role in the regulatory process.
Also on May 6, 2009, as a companion to Rep. Frank’s Internet Gambling Regulation, Consumer Protection, and Enforcement Act of 2009 Rep. Jim McDermott (D-WA) re-introduced the Internet Gambling Regulation and Tax Enforcement Act (H.R. 2268) which would ensure that individual and corporate taxes owed on regulated Internet gambling activities are collected.
The Poker Players Alliance
has raised $3million to help get the law repealed.
In June 2009, the U.S. Department of Justice seized over $34 million belonging to over 27,000 accounts in the Southern District of New York Action Against Online Poker Players
. This is the first time money was seized from individual players as compared to the gaming company. Jeff Ifrah, the lawyer for one of the account management companies affected, said that the government “has never seized an account that belongs to players who are engaged in what [Ifrah] would contend is a lawful act of playing peer-to-peer poker online."
On October 29, 2009, a Joint Committee on Taxation analysis found that regulating Internet gambling, as proposed in pending legislation introduced by Representatives Barney Frank (D-MA) and McDermott, would generate nearly $42 billion over 10 years. The analysis is based on the provision of a federal license for operators that would allow them to offer online gambling throughout the United States, while maintaining existing federal prohibitions on any form of sports betting.
On November 27, 2009, Department of the Treasury Secretary Timothy F. Geithner
and Federal Reserve Chairman Ben S. Bernanke announced a six month delay, until June 1, 2010, required compliance with the Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA). The move blocks regulations to implement the legislation which requires the financial services sector to comply with rules that attempt to prevent unlawful Internet gambling transactions.
On December 3, 2009, the House Financial Services Committee held a hearing on UIGEA and Rep. Frank’s Internet Gambling Regulation, Consumer Protection, and Enforcement Act of 2009 (H.R. 2267) where experts in the fields of online security and consumer safety testified that a regulatory framework for Internet gambling would protect consumers and ensure the integrity of Internet gambling financial transactions. On July 28, 2010, the committee passed H.R. 2267 by a vote of 41-22-1. The bill would legalize and regulate online poker and some other forms of online gambling.
On November 22, 2010, the New Jersey state Senate became the first such US body to pass a bill (S490) expressly legalizing certain forms of online gambling. The bill was passed with a 29-5 majority. The bill allows bets to be taken by in-State companies on poker games, casino games and slots but excludes sports betting, although it allows for the latter to be proposed, voted on and potentially regulated separately in due course. However, a Fairleigh Dickinson University
PublicMind poll in April 2009 showed only 26% of New Jersey voters approved of online sports-betting. On a national level, two-thirds (67%) of voters polled by PublicMind in March 2010 opposed changing the law to allow online betting. Men were more likely than women (29%-14%) and liberals more likely than conservatives (27%-18%) to approve of changing the law to allow online betting.
On April 15, 2011, in U. S. v. Scheinberg et al. (10 Cr. 336), three online poker
companies were indicted for violating U.S. laws that prohibit the acceptance of any financial instrument in connection with unlawful Internet gambling, that is, Internet gambling that involves a "bet or wager" that is illegal under the laws of the state
where the bet is made. The indictment alleges that the companies used fraudulent methods to evade this law, for example, by disguising online gambling payments as purchases of merchandise, and by investing money in a local bank in return for the bank's willingness to process online poker transactions. The companies argue that poker
is a game of skill rather than a game of chance, and therefore, online poker is not unlawful Internet gambling. There are other legal problems with the government's case; and, interestingly, the indictments did not mention the Wire Act.
Caesars Entertainment, owner of several casinos, recently began increasing its lobbying to legalize U.S. online gambling companies, notably after many non-U.S. companies have been prosecuted or have shut down operations in the U.S.
, most members of the European Union
and several nations in and around the Caribbean Sea
.
A study by the UK Gambling Commission, the "British Gambling Prevalence Survey 2007", found that approximately 0.6% of the adult population had problem gambling issues, the same percentage as in 1999. The highest prevalence of problem gambling was found among those who participated in spread betting
(14.7%), fixed odds betting terminals (11.2%) and betting exchange
s (9.8%). Additionally the report noted a 4% drop in overall gambling in the prior year, from a rate of 62% in 1999 to 58% in 2007. Significantly the 2007 prevalence survey combined with the 1999 prevalence survey suggest that despite the rapid growth of Internet gambling there has been no associated increase in the number of problem gamblers.
large amounts of money.
However, according to a US GAO study, "Banking and gaming regulatory officials did not view Internet gambling as being particularly susceptible to money laundering, especially when credit cards, which create a transaction record and are subject to relatively low transaction limits, were used for payment. Likewise, credit card and gaming industry officials did not believe Internet gambling posed any particular risks in terms of money laundering."
Gambling
Gambling is the wagering of money or something of material value on an event with an uncertain outcome with the primary intent of winning additional money and/or material goods...
using the Internet
Internet
The Internet is a global system of interconnected computer networks that use the standard Internet protocol suite to serve billions of users worldwide...
.
Online poker
Online pokerPoker
Poker is a family of card games that share betting rules and usually hand rankings. Poker games differ in how the cards are dealt, how hands may be formed, whether the high or low hand wins the pot in a showdown , limits on bet sizes, and how many rounds of betting are allowed.In most modern poker...
tables commonly offer Texas hold 'em
Texas hold 'em
Texas Hold 'em is a variation of the standard card game of poker. The game consists of two cards being dealt face down to each player and then five community cards being placed face-up by the dealer—a series of three then two additional single cards , with...
, Omaha, Seven-card stud
Seven-card stud
Seven-card stud is a variant of stud poker. Until the recent increase in popularity of Texas hold 'em, seven-card stud was the most popular poker variant in home games across the United States, and in casinos in the eastern part of the country. Two to eight players is common, though eight may...
, razz, HORSE
HORSE
H.O.R.S.E. is a form of poker commonly played at the high stakes tables of casinos. It consists of rounds of play cycling among:*Texas Hold 'em,*Omaha eight or better,*Razz,*Seven card Stud, and...
and other game types in both tournament
Poker tournament
A poker tournament is a tournament where players compete by playing poker. It can feature as few as two players playing on a single table , and as many as tens of thousands of players playing on thousands of tables...
and ring game
Ring game
Ring game may refer to:*Ring game , a general class of multi-player pocket billiards gambling games*Ring game, a.k.a. cash game, a poker game played with "real" chips and each player's own money at stake, as opposed to a poker tournament with a prize money pool...
structures. Players play against each other rather than the "house", with the card room making its money through "rake
Rake (poker)
Rake is the scaled commission fee taken by a cardroom operating a poker game. It is generally 5 to 10 percent of the pot in each poker hand, up to a predetermined maximum amount. There are also other non-percentage ways for a casino to take the rake. Some cardrooms will not take a percentage rake...
" and through tournament fees.
Online casinos
There is a large number of online casinoOnline casino
Online casinos, also known as virtual casinos or Internet casinos, are online versions of traditional casinos. Online casinos enable gamblers to play and wager on casino games through the Internet....
s, in which people can play casino games such as roulette
Roulette
Roulette is a casino game named after a French diminutive for little wheel. In the game, players may choose to place bets on either a single number or a range of numbers, the colors red or black, or whether the number is odd or even....
, blackjack
Blackjack
Blackjack, also known as Twenty-one or Vingt-et-un , is the most widely played casino banking game in the world...
, pachinko
Pachinko
is a type of game originating in Japan, and used as both a form of recreational arcade game and much more frequently as a gambling device, filling a niche in gambling in Japan comparable to that of the slot machine in Western gambling. A pachinko machine resembles a vertical pinball machine, but...
, baccarat
Baccarat
Baccarat is a card game, played at casinos and by gamblers. It is believed to have been introduced into France from Italy during the reign of King Charles VIII , and it is similar to Faro and Basset...
and many others. These games are played against the "house", which makes money due to the fact that the odds are in its favor.
Online sports betting
BookmakerBookmaker
A bookmaker, or bookie, is an organization or a person that takes bets on sporting and other events at agreed upon odds.- Range of events :...
s, spread betting
Spread betting
Spread betting is any of various types of wagering on the outcome of an event, where the pay-off is based on the accuracy of the wager, rather than a simple "win or lose" outcome, such as fixed-odds betting or parimutuel betting. A spread is a range of outcomes and the bet is whether the outcome...
firms and betting exchanges
Bet exchange
A betting exchange is an entity which provides "trading" facilities for retail or bookmaker customers to buy and sell contracts. Contracts are structured as binary options. Some betting exchanges may also offer CFD products...
offer a variety of ways to wager over the Internet on the results of sporting events
Sport
A Sport is all forms of physical activity which, through casual or organised participation, aim to use, maintain or improve physical fitness and provide entertainment to participants. Sport may be competitive, where a winner or winners can be identified by objective means, and may require a degree...
, the most popular being fixed-odds gambling
Fixed-odds gambling
Fixed-odds betting is a form of wagering against odds offered by a bookmaker, an individual, or on a bet exchange.-Calculating fixed odds:It is customary with fixed-odds gambling to know the odds at the time of the placement of the wager , although this category also includes wagers whose price is...
.
Online bingo
There are a number of online bingo rooms offering games on the Internet.Online lotteries
Most lotteriesLottery
A lottery is a form of gambling which involves the drawing of lots for a prize.Lottery is outlawed by some governments, while others endorse it to the extent of organizing a national or state lottery. It is common to find some degree of regulation of lottery by governments...
are run by governments and are heavily protected from competition due to their ability to generate large taxable cash flows. The first online lotteries were run by private individuals or companies and licensed to operate by small countries. Most private online lotteries have stopped trading as governments have passed new laws giving themselves and their own lotteries greater protection. Government controlled lotteries now offer their games online.
Online horse racing betting
Horse racingHorse racing
Horse racing is an equestrian sport that has a long history. Archaeological records indicate that horse racing occurred in ancient Babylon, Syria, and Egypt. Both chariot and mounted horse racing were events in the ancient Greek Olympics by 648 BC...
betting comprises a significant percentage of online gambling wagers and all major Internet bookmakers, betting exchanges, and sports books offer a wide variety of horse racing betting markets
Mobile gambling
Developments in the use of wireless, mobile devices to gamble follow in the wake of mainstream online gambling.Funds transfers
Normally, gamblers upload funds to the online gambling company, make bets or play the games that it offers, and then cash out any winnings. Gamblers can often fund gambling accounts by credit cardCredit card
A credit card is a small plastic card issued to users as a system of payment. It allows its holder to buy goods and services based on the holder's promise to pay for these goods and services...
or debit card
Debit card
A debit card is a plastic card that provides the cardholder electronic access to his or her bank account/s at a financial institution...
, and cash out winnings directly back to the card; most U.S.
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
banks, however, prohibit the use of their cards for the purpose of Internet gambling, and attempts by Americans to use credit cards at Internet gambling sites are usually rejected. A number of electronic money
Electronic money
Electronic money is money or scrip that is only exchanged electronically. Typically, this involves the use of computer networks, the internet and digital stored value systems...
services offer accounts with which online gambling can be funded; however, many top fund-transfer sites such as FirePay, Neteller & Moneybookers
Moneybookers
Moneybookers is an e-commerce business that allows payments and money transfers to be made through the Internet. It serves as an electronic alternative to traditional paper methods such as cheques and money orders. Moneybookers performs payment processing for websites, online auction sites, and...
have discontinued service for U.S. residents.
Payment by cheque
Cheque
A cheque is a document/instrument See the negotiable cow—itself a fictional story—for discussions of cheques written on unusual surfaces. that orders a payment of money from a bank account...
and wire transfer
Wire transfer
Wire transfer or credit transfer is a method of electronic funds transfer from one person or institution to another. A wire transfer can be made from one bank account to another bank account or through a transfer of cash at a cash office...
is also common.
Antigua and Barbuda
The government of the island nation of Antigua and BarbudaAntigua and Barbuda
Antigua and Barbuda is a twin-island nation lying between the Caribbean Sea and the Atlantic Ocean. It consists of two major inhabited islands, Antigua and Barbuda, and a number of smaller islands...
, which licenses Internet gambling entities, made a complaint to the World Trade Organization
World Trade Organization
The World Trade Organization is an organization that intends to supervise and liberalize international trade. The organization officially commenced on January 1, 1995 under the Marrakech Agreement, replacing the General Agreement on Tariffs and Trade , which commenced in 1948...
about the U.S. government's actions to impede online gaming. The Caribbean country won the preliminary ruling but WTO's appeals body somewhat narrowed that favorable ruling in April 2005. The appeals decision held that various state laws argued by Antigua and Barbuda to be contrary to the WTO agreements were not sufficiently discussed during the course of the proceedings to be properly assessed by the panel. However, the appeals panel also ruled that the Wire Act and two other federal statutes prohibiting the provision of gambling services from Antigua to the United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
violated the WTO's General Agreement on Trade in Services
General Agreement on Trade in Services
The General Agreement on Trade in Services is a treaty of the World Trade Organization that entered into force in January 1995 as a result of the Uruguay Round negotiations...
, or "GATS". Although the United States convinced the appeals panel that these laws were "necessary" to protect public health and morals, the asserted United States defense on these grounds was ultimately rejected because its laws relating to remote gambling on horse-racing were not applied equally to foreign and domestic online betting companies, and thus the United States could not establish that its laws were non-discriminatory.
On March 30, 2007, the WTO confirmed the U.S. "had done nothing to abide by an earlier verdict that labeled some U.S. Internet gambling restrictions as illegal."
On June 19, 2007, Antigua and Barbuda filed a claim with the WTO for USD $3.4 billion in trade sanctions against the United States, along with a request for authorization to ignore U.S. patent and copyright laws. This followed by a day similar demands for compensation made by the European Union
European Union
The European Union is an economic and political union of 27 independent member states which are located primarily in Europe. The EU traces its origins from the European Coal and Steel Community and the European Economic Community , formed by six countries in 1958...
.
Many of the companies operating out of Antigua are publicly traded on various stock exchanges, specifically the London Stock Exchange
London Stock Exchange
The London Stock Exchange is a stock exchange located in the City of London within the United Kingdom. , the Exchange had a market capitalisation of US$3.7495 trillion, making it the fourth-largest stock exchange in the world by this measurement...
. Antigua has met British regulatory standards and has been added to the UK's “white list”, which allows licensed Antiguan companies to advertise in the UK.
Australia
On 28 June 2001 the Australian Government passed the Interactive Gambling ActInteractive gambling act
The Interactive Gambling Act was passed in June 2001 by the Australian Government with the purpose of protecting the Australian public from the detrimental effects of online gambling.-The Law:...
2001 (IGA). The government said that the IGA was important to protect Australians from the harmful effects of gambling.
The IGA targets the providers of interactive gambling services. The IGA makes it an offence to provide an interactive gambling service to a customer physically present in Australia, but it is not an offence for Australian residents to play poker or casino games online. In stark contrast to the USA, sports betting online is also completely legal in Australia, with many state government licensed sportsbooks in operation, such as Centrebet
Centrebet
Centrebet is an Australian bookmaker licensed in the Northern Territory.Centrebet originated from Alice Springs, Northern Territory and was the first bookmaker to be licensed in Australia in 1993 and the first bookmaker to go online in the Southern Hemisphere. Centrebet was acquired by its biggest...
, Sportingbet
Sportingbet
Sportingbet plc is a British e-gaming operator. It is listed on the London Stock Exchange and is a constituent of the FTSE SmallCap Index.-History:The Company was founded by Mark Blandford in 1997. Sportingbet acquired Paradise Poker in October 2004...
& Betfair
Betfair
Betfair is the world's largest Internet betting exchange. The company is based in Hammersmith in West London, England. Since Betfair was launched in June 2000 it has become the largest online betting company in the UK and the largest betting exchange in the world. Betfair claim to have over 3...
.
The offense applies to all interactive gambling service providers, whether based in Australia or offshore, whether Australian or foreign owned.
France
On March 5, 2009, FranceFrance
The French Republic , The French Republic , The French Republic , (commonly known as France , is a unitary semi-presidential republic in Western Europe with several overseas territories and islands located on other continents and in the Indian, Pacific, and Atlantic oceans. Metropolitan France...
proposed new laws to regulate and tax Internet gambling. Budget minister Eric Woerth stated the French gambling market would expand to adapt to "Internet reality." He further stated "Rather than banning 25,000 websites, we'd rather give licenses to those who will respect public and social order." The new regulations are expected to take effect in June 2010. Betting exchanges, however, will remain illegal under the new plans.
Germany
The German Interstate Treaty on gaming which came into force on January 1, 2008, banned all forms of online gaming and betting in the country, with the exception of wagers on horse racing. The European Gaming & Betting Association turned to the European Commission with the request to take action against the German legislation, because such stringent legislation violated EU rules. In 2010, the European Court of Justice ruled that the monopolised gambling industry in GermanyGermany
Germany , officially the Federal Republic of Germany , is a federal parliamentary republic in Europe. The country consists of 16 states while the capital and largest city is Berlin. Germany covers an area of 357,021 km2 and has a largely temperate seasonal climate...
has to be liberalised. Schleswig-Holstein is the only German state that has already come up with their own gambling bill allowing gambling online. From 2012, casino operators can apply for an online gambling license in this state.
India
Online gambling is a banned offense in the state of Maharashtra under the "Bombay Wager Act". Other acts/legislations are silent with respect to online gambling/online gaming in IndiaIndia
India , officially the Republic of India , is a country in South Asia. It is the seventh-largest country by geographical area, the second-most populous country with over 1.2 billion people, and the most populous democracy in the world...
.
Israel
The IsraelIsrael
The State of Israel is a parliamentary republic located in the Middle East, along the eastern shore of the Mediterranean Sea...
gambling law (Israeli Penal Law 5737 - 1977) does not refer specifically to online gambling (land based gambling and playing games of chances is prohibited except in the cases of the Israel Lottery and the Israeli Commission for Sports Gambling). In December 2005, the Attorney General ordered all online gambling operations, online backgammon
Backgammon
Backgammon is one of the oldest board games for two players. The playing pieces are moved according to the roll of dice, and players win by removing all of their pieces from the board. There are many variants of backgammon, most of which share common traits...
included, to close their businesses and at the same time commanded credit card companies to cease cooperating with online gambling websites. In May 2007, the Attorney General had excluded the online backgammon website Play65
Play65
Play65 is an online backgammon operator established in 2004 by an Israeli-based company, SkillEmpire, that hosts real-time backgammon games and tournaments. With its client software available in 21 languages, including English, Arabic, Chinese, Danish, Dutch, etc. Play65 has more than 5,000,000...
of the ruling, due to "the unique circumstances of the site activity", allowing to return to full activity in Israel.
Russia
RussiaRussia
Russia or , officially known as both Russia and the Russian Federation , is a country in northern Eurasia. It is a federal semi-presidential republic, comprising 83 federal subjects...
n legislation, enacted in December 2006, prohibits online gambling altogether (as well as any gambling relying on telecommunications technology).
United States
The United States Court of Appeals for the Fifth CircuitUnited States Court of Appeals for the Fifth Circuit
The United States Court of Appeals for the Fifth Circuit is a federal court with appellate jurisdiction over the district courts in the following districts:* Eastern District of Louisiana* Middle District of Louisiana...
ruled in November 2002 that the Federal Wire Act
Federal Wire Act
The Interstate Wire Act of 1961, often called the Federal Wire Act, is a United States federal law prohibiting the operation of certain types of betting businesses in the United States. It begins with the text:...
prohibits electronic transmission of information for sports betting across telecommunications lines but affirmed a lower court ruling that the Wire Act "'in plain language' does not prohibit Internet gambling on a game of chance." But the federal Department of Justice continues, publicly, to take the position that the Wire Act covers all forms of gambling.
Online gambling, which was once illegal in all but two states, is now accepted by most states, though some states have specific laws against online gambling of any kind. In addition, owning an online gaming operation without proper licensing is illegal, and no states currently grant online gaming licenses. Despite this, online gambling now generates more than $60 billion in revenue for the United States.
In March 2003, Deputy Assistant Attorney General John G. Malcolm testified before the Senate Banking Committee regarding the special problems presented by online gambling. A major concern of the United States Department of Justice
United States Department of Justice
The United States Department of Justice , is the United States federal executive department responsible for the enforcement of the law and administration of justice, equivalent to the justice or interior ministries of other countries.The Department is led by the Attorney General, who is nominated...
is online money laundering
Money laundering
Money laundering is the process of disguising illegal sources of money so that it looks like it came from legal sources. The methods by which money may be laundered are varied and can range in sophistication. Many regulatory and governmental authorities quote estimates each year for the amount...
. The anonymous nature of the Internet and the use of encryption make it especially difficult to trace online money laundering transactions.
In April 2004 Google
Google
Google Inc. is an American multinational public corporation invested in Internet search, cloud computing, and advertising technologies. Google hosts and develops a number of Internet-based services and products, and generates profit primarily from advertising through its AdWords program...
and Yahoo!
Yahoo!
Yahoo! Inc. is an American multinational internet corporation headquartered in Sunnyvale, California, United States. The company is perhaps best known for its web portal, search engine , Yahoo! Directory, Yahoo! Mail, Yahoo! News, Yahoo! Groups, Yahoo! Answers, advertising, online mapping ,...
, the two largest Internet search engines, announced that they were removing online gambling advertising from their sites. The move followed a United States Department of Justice announcement that, in what some say is a contradiction of the Appeals Court ruling, the Wire Act relating to telephone betting applies to all forms of Internet gambling, and that any advertising of such gambling "may" be deemed as aiding and abetting. Critics of the Justice Department's move say that it has no legal basis for pressuring companies to remove advertisements and that the advertisements are protected by the First Amendment
First Amendment to the United States Constitution
The First Amendment to the United States Constitution is part of the Bill of Rights. The amendment prohibits the making of any law respecting an establishment of religion, impeding the free exercise of religion, abridging the freedom of speech, infringing on the freedom of the press, interfering...
. In April 2005, Yahoo! has instigated a restrictive policy about gambling ads.
In August 2004, Casino City, an online portal for Internet gambling sites, sued the U.S. Department of Justice. The complaint alleged, inter alia, that the website's business—promoting Internet gambling—was legal, and requested a declaration from the court that its business was protected by the First Amendment. The U.S. District Court for the Middle District of Louisiana dismissed the case in February 2005.
In its opinion, the District Court wrote,
- It is well-established that the First Amendment does not protect the right to advertise illegal activity... The government's interest is specifically directed towards the advertising of illegal activity, namely Internet gambling... Furthermore, the speech in which the plaintiff wishes to engage is misleading because it falsely portrays the image that Internet gambling is legal... Because plaintiff's speech concerns misleading information and illegal activities, it does not fall within the speech that is protected by the First Amendment.
The U.S. Court of Appeals, 5th Circuit, dismissed Casino City's appeal in January, 2006.
In February 2005 the North Dakota
North Dakota
North Dakota is a state located in the Midwestern region of the United States of America, along the Canadian border. The state is bordered by Canada to the north, Minnesota to the east, South Dakota to the south and Montana to the west. North Dakota is the 19th-largest state by area in the U.S....
House of Representatives passed a bill to legalize and regulate online poker and online poker cardroom operators in the state. Testifying before the State Senate, Nigel Payne, CEO of Paradise Poker
Sportingbet
Sportingbet plc is a British e-gaming operator. It is listed on the London Stock Exchange and is a constituent of the FTSE SmallCap Index.-History:The Company was founded by Mark Blandford in 1997. Sportingbet acquired Paradise Poker in October 2004...
, pledged to relocate to the state if the bill became law. However, the measure was defeated by the State Senate in March 2005. Rep. Jim Kasper, who sponsored the 2005 legislation, planned to introduce similar bills in the 2007 North Dakota legislative session.
In July 2006, David Carruthers
David Carruthers
David Carruthers was the CEO and a board member of online gambling company BETonSPORTS plc. He served as CEO from July 2000 until July 24, 2006...
, the CEO of BetonSports
BetonSports
BetonSports plc is a British online gambling company founded by Gary Kaplan in 1995. The company was one of the biggest players in the United States online gaming market, drawing in several billion US dollars in wagers in the early 2000s...
, a company publicly traded on the London Stock Exchange
London Stock Exchange
The London Stock Exchange is a stock exchange located in the City of London within the United Kingdom. , the Exchange had a market capitalisation of US$3.7495 trillion, making it the fourth-largest stock exchange in the world by this measurement...
, was detained in Texas while changing planes on his way from London to Costa Rica. He and ten other individuals had been previously charged in a sealed indictment with violations of US federal laws relating to illegal gambling. While as noted above, a United States Appeals court has stated that the Wire Act does not apply to non-sports betting, the Supreme Court of the United States
Supreme Court of the United States
The Supreme Court of the United States is the highest court in the United States. It has ultimate appellate jurisdiction over all state and federal courts, and original jurisdiction over a small range of cases...
previously refused to hear an appeal of the conviction of Jay Cohen
Jay Cohen
Jay Cohen is the cofounder and CEO of World Sports Exchange , an online gambling company from 1996 until July 24, 2000, when he was the first United States citizen to be convicted in US Federal Court for violation of the Federal Wire Act for operating an online gambling company from a jurisdiction...
, where lower courts held that the Wire Act does make it illegal to own a sports betting operation that offers such betting to United States citizens.
The BetOnSports indictment alleged violations of at least nine different federal statutes, including 18 USC Sec. 1953 (Operation of an Illegal Gambling Business). Carruthers is currently under house arrest on a one million dollar bail bond.
In September 2006, Sportingbet
Sportingbet
Sportingbet plc is a British e-gaming operator. It is listed on the London Stock Exchange and is a constituent of the FTSE SmallCap Index.-History:The Company was founded by Mark Blandford in 1997. Sportingbet acquired Paradise Poker in October 2004...
reported that its chairman, Peter Dicks
Peter Dicks
Peter F. Dicks is a London-based investment manager and venture capitalist. He was the co-founder of Abingworth plc, one of the earlier venture capital funds in Europe. He is also the former chairman of Sportingbet PLC, one of the world's largest sportsbooks.Early in his career, Dicks was a...
, was detained in New York City on a Louisiana warrant while traveling in the United States on business unrelated to online gaming. Louisiana is one of the few states that has a specific law prohibiting gambling online. At the end of the month, New York dismissed the Louisiana warrant.
Also in September 2006, just before adjourning for the midterm elections, both the House of Representatives and Senate passed the Unlawful Internet Gambling Enforcement Act of 2006
Unlawful Internet Gambling Enforcement Act of 2006
The Unlawful Internet Gambling Enforcement Act of 2006 is United States legislation regulating online gambling. It was added as Title VIII to the SAFE Port Act which otherwise regulated port security...
(as a section of the unrelated SAFE Port Act
SAFE Port Act
The Security and Accountability For Every Port Act of 2006 was an Act of Congress in the United States covering port security and to which an online gambling measure was added at the last moment...
) to make transactions from banks or similar institutions to online gambling sites illegal. This differed from a previous bill passed only by the House that expanded the scope of the Wire Act. The passed bill only addressed banking issues. The Act was signed into law on October 13, 2006, by President George W. Bush
George W. Bush
George Walker Bush is an American politician who served as the 43rd President of the United States, from 2001 to 2009. Before that, he was the 46th Governor of Texas, having served from 1995 to 2000....
. At the UIGEA bill-signing ceremony, Bush did not mention the Internet gambling measure, which was supported by the National Football League
National Football League
The National Football League is the highest level of professional American football in the United States, and is considered the top professional American football league in the world. It was formed by eleven teams in 1920 as the American Professional Football Association, with the league changing...
but opposed by banking groups.
In response to Unlawful Internet Gambling Enforcement Act, a number of online gambling operators including PartyGaming
PartyGaming
bwin.Party Digital Entertainment Plc is an online gambling company, formed by the March 2011 merger of PartyGaming plc and bwin. The world's largest publicly traded online gambling firm, it is best known for its online poker room PartyPoker.com and its sports betting brand Bwin. It is...
, Bwin, Cassava Enterprises
Cassava Enterprises
888 Holdings plc is a company which operates several high-profile gambling websites. It was founded in 1997 and is a constituent of the FTSE SmallCap Index....
, and Sportingbet
Sportingbet
Sportingbet plc is a British e-gaming operator. It is listed on the London Stock Exchange and is a constituent of the FTSE SmallCap Index.-History:The Company was founded by Mark Blandford in 1997. Sportingbet acquired Paradise Poker in October 2004...
announced that real-money gambling operations would be suspended for U.S. customers. PartyGaming's stock dropped by 60% following its announcement. Other operators such as PokerStars
PokerStars
PokerStars is the largest online poker cardroom in the world. PokerStars' satellite tournaments produced the 2003 World Series of Poker champion, Chris Moneymaker. 1983 champion Tom McEvoy, 2005 champion Joe Hachem, 2009 champion Joe Cada and 2010 champion Jonathan Duhamel and others also represent...
, Full Tilt Poker
Full Tilt Poker
Full Tilt Poker is an online poker card room that opened in June 2004 with the involvement of poker professionals Howard Lederer, Phil Ivey, Andy Bloch, Mike Matusow, Jennifer Harman and Chris Ferguson...
, Bodog
Bodog
Bodog is an online entertainment brand launched in 1994 by Calvin Ayre.Originally the company traded at but the brand was later divested and intellectual property rights were assigned to and consolidated in BodogBrand.com...
, and World Sports Exchange
World Sports Exchange
World Sports Exchange is an online bookmaker offering sportsbook gambling odds and sportsbook wagering lines including, football lines, basketball odds, baseball parlays, hockey odds, and horse racing track odds. Established in 1995, it is one of the pioneers of internet gaming...
announced their intention to continue serving customers in the U.S.
The regulation called for in the UIGEA were issued in November 2008. The regulation does not define "unlawful Internet gambling."
On April 26, 2007, Rep. Barney Frank
Barney Frank
Barney Frank is the U.S. Representative for . A member of the Democratic Party, he is the former chairman of the House Financial Services Committee and is considered the most prominent gay politician in the United States.Born and raised in New Jersey, Frank graduated from Harvard College and...
(D-MA) introduced HR 2046, the Internet Gambling Regulation, Consumer Protection, and Enforcement Act
Internet Gambling Regulation, Consumer Protection, and Enforcement Act
The Internet Gambling Regulation, Consumer Protection, and Enforcement Act was a proposed 2009 bill in the United State House of Representatives that is intended "to provide for the licensing of Internet gambling activities by the Secretary of the Treasury, to provide for consumer protections on...
, which would modify UIGEA by providing a provision for licensing of Internet gambling facilities by the Director of the Financial Crimes Enforcement Network.
On June 7, 2007, Rep. Robert Wexler
Robert Wexler
Robert Wexler is the president of the Washington-based S. Daniel Abraham Center for Middle East Peace.Wexler was a Democratic member of the U.S. House of Representatives, representing , from 1997 until his resignation on January 3, 2010.-Early life:Wexler was born in Queens, New York to Sonny and...
(D-FL) introduced HR 2610, the Skill Game Protection Act, which would legalize Internet poker, bridge, chess, and other games of skill. Also on June 7, Rep. Jim McDermott
Jim McDermott
James Adelbert "Jim" McDermott is the U.S. Representative for , serving since 1989. He is a member of the Democratic Party. The 7th District includes most of Seattle and Vashon Island, and portions of Shoreline, Lake Forest Park, Tukwila, SeaTac, and Burien.He serves on the House Ways and Means...
(D-WA) introduced H.R. 2607, the Internet Gambling Regulation and Tax Enforcement Act. IGRTEA would legislate Internet gambling tax collection requirements.
On June 8, 2007, the House Financial Services Committee, chaired by Barney Frank, held a hearing entitled, "Can Internet Gambling Be Effectively Regulated to Protect Consumers and the Payments System?". Expert witnesses at the hearing testified that Internet gambling can be effectively regulated for age verification, money laundering issues, facilitation of state and federal tax collection, and for issues relating to compulsive gambling.
On September 26, 2008, Sen. Robert Menendez
Robert Menendez
Robert "Bob" Menendez is the junior United States Senator from New Jersey and a member of the Democratic Party. In January 2006, he was appointed to fill the U.S. Senate seat vacated by Jon Corzine, who resigned upon being elected Governor of New Jersey. Menendez was elected to his own full...
(D-NJ) introduced S.3616, the Internet Skill Game Licensing and Control Act. This bill would amend title 31, United States Code, to provide for the licensing of Internet skill game facilities, and for other purposes. This is the first bill related to online skill games that has been introduced in the Senate.
On May 6, 2009, Rep. Barney Frank (D-MA), re-introduced the Internet Gambling Regulation, Consumer Protection, and Enforcement Act
Internet Gambling Regulation, Consumer Protection, and Enforcement Act
The Internet Gambling Regulation, Consumer Protection, and Enforcement Act was a proposed 2009 bill in the United State House of Representatives that is intended "to provide for the licensing of Internet gambling activities by the Secretary of the Treasury, to provide for consumer protections on...
(H.R. 2267). The legislation would establish a framework to permit licensed gambling operators to accept wagers from individuals in the U.S. and mandates a number of significant consumer protections, including safeguards against compulsive and underage gambling, money laundering, fraud and identify theft. Additional provisions in the legislation reinforce the rights of each state to determine whether to allow Internet gambling activity for people accessing the Internet within the state and to apply other restrictions on the activity as determined necessary. The legislation also would allow states and Native American tribes with experience in regulating gambling to play a role in the regulatory process.
Also on May 6, 2009, as a companion to Rep. Frank’s Internet Gambling Regulation, Consumer Protection, and Enforcement Act of 2009 Rep. Jim McDermott (D-WA) re-introduced the Internet Gambling Regulation and Tax Enforcement Act (H.R. 2268) which would ensure that individual and corporate taxes owed on regulated Internet gambling activities are collected.
The Poker Players Alliance
Poker Players Alliance
The Poker Players Alliance is an American nonprofit Interest group formed "to speak with one voice to promote poker, and to protect the players' rights." The PPA formed to serve as an advocacy group to Washington to establish rights and protections for U.S. poker players. Within the first year of...
has raised $3million to help get the law repealed.
In June 2009, the U.S. Department of Justice seized over $34 million belonging to over 27,000 accounts in the Southern District of New York Action Against Online Poker Players
Southern District of New York Action Against Online Poker Players
The Southern District of New York Action Against Online Poker Players was a legal action taken by the Department of Justice in an effort to crack down on online poker. The action occurred around June 8, 2009, when the government ordered four banks to freeze over 34 million dollars in payments...
. This is the first time money was seized from individual players as compared to the gaming company. Jeff Ifrah, the lawyer for one of the account management companies affected, said that the government “has never seized an account that belongs to players who are engaged in what [Ifrah] would contend is a lawful act of playing peer-to-peer poker online."
On October 29, 2009, a Joint Committee on Taxation analysis found that regulating Internet gambling, as proposed in pending legislation introduced by Representatives Barney Frank (D-MA) and McDermott, would generate nearly $42 billion over 10 years. The analysis is based on the provision of a federal license for operators that would allow them to offer online gambling throughout the United States, while maintaining existing federal prohibitions on any form of sports betting.
On November 27, 2009, Department of the Treasury Secretary Timothy F. Geithner
Timothy F. Geithner
Timothy Franz Geithner is an American economist, central banker, and civil servant. He is the 75th and current United States Secretary of the Treasury, serving under President Barack Obama...
and Federal Reserve Chairman Ben S. Bernanke announced a six month delay, until June 1, 2010, required compliance with the Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA). The move blocks regulations to implement the legislation which requires the financial services sector to comply with rules that attempt to prevent unlawful Internet gambling transactions.
On December 3, 2009, the House Financial Services Committee held a hearing on UIGEA and Rep. Frank’s Internet Gambling Regulation, Consumer Protection, and Enforcement Act of 2009 (H.R. 2267) where experts in the fields of online security and consumer safety testified that a regulatory framework for Internet gambling would protect consumers and ensure the integrity of Internet gambling financial transactions. On July 28, 2010, the committee passed H.R. 2267 by a vote of 41-22-1. The bill would legalize and regulate online poker and some other forms of online gambling.
On November 22, 2010, the New Jersey state Senate became the first such US body to pass a bill (S490) expressly legalizing certain forms of online gambling. The bill was passed with a 29-5 majority. The bill allows bets to be taken by in-State companies on poker games, casino games and slots but excludes sports betting, although it allows for the latter to be proposed, voted on and potentially regulated separately in due course. However, a Fairleigh Dickinson University
Fairleigh Dickinson University
Fairleigh Dickinson University is a private university founded as a junior college in 1942. It now has several campuses located in New Jersey, Canada, and the United Kingdom.-Description:...
PublicMind poll in April 2009 showed only 26% of New Jersey voters approved of online sports-betting. On a national level, two-thirds (67%) of voters polled by PublicMind in March 2010 opposed changing the law to allow online betting. Men were more likely than women (29%-14%) and liberals more likely than conservatives (27%-18%) to approve of changing the law to allow online betting.
On April 15, 2011, in U. S. v. Scheinberg et al. (10 Cr. 336), three online poker
Online poker
Online poker is the game of poker played over the Internet. It has been partly responsible for a dramatic increase in the number of poker players worldwide...
companies were indicted for violating U.S. laws that prohibit the acceptance of any financial instrument in connection with unlawful Internet gambling, that is, Internet gambling that involves a "bet or wager" that is illegal under the laws of the state
U.S. state
A U.S. state is any one of the 50 federated states of the United States of America that share sovereignty with the federal government. Because of this shared sovereignty, an American is a citizen both of the federal entity and of his or her state of domicile. Four states use the official title of...
where the bet is made. The indictment alleges that the companies used fraudulent methods to evade this law, for example, by disguising online gambling payments as purchases of merchandise, and by investing money in a local bank in return for the bank's willingness to process online poker transactions. The companies argue that poker
Poker
Poker is a family of card games that share betting rules and usually hand rankings. Poker games differ in how the cards are dealt, how hands may be formed, whether the high or low hand wins the pot in a showdown , limits on bet sizes, and how many rounds of betting are allowed.In most modern poker...
is a game of skill rather than a game of chance, and therefore, online poker is not unlawful Internet gambling. There are other legal problems with the government's case; and, interestingly, the indictments did not mention the Wire Act.
Caesars Entertainment, owner of several casinos, recently began increasing its lobbying to legalize U.S. online gambling companies, notably after many non-U.S. companies have been prosecuted or have shut down operations in the U.S.
Other countries
Various forms of online gambling are legal and regulated in many countries, including some provinces in CanadaCanada
Canada is a North American country consisting of ten provinces and three territories. Located in the northern part of the continent, it extends from the Atlantic Ocean in the east to the Pacific Ocean in the west, and northward into the Arctic Ocean...
, most members of the European Union
European Union
The European Union is an economic and political union of 27 independent member states which are located primarily in Europe. The EU traces its origins from the European Coal and Steel Community and the European Economic Community , formed by six countries in 1958...
and several nations in and around the Caribbean Sea
Caribbean Sea
The Caribbean Sea is a sea of the Atlantic Ocean located in the tropics of the Western hemisphere. It is bounded by Mexico and Central America to the west and southwest, to the north by the Greater Antilles, and to the east by the Lesser Antilles....
.
Problem gambling
In the United States in 1999 the National Gambling Impact Study stated "the high-speed instant gratification of Internet games and the high level of privacy they offer may exacerbate problem and pathological gambling". A UK government-funded review of previous research noted a small scale patient survey leading to press reports claiming that 75% of people who gamble online are "problem" or "pathological" gamblers, compared to just 20% of people who visit legitimate land-based casinos.A study by the UK Gambling Commission, the "British Gambling Prevalence Survey 2007", found that approximately 0.6% of the adult population had problem gambling issues, the same percentage as in 1999. The highest prevalence of problem gambling was found among those who participated in spread betting
Spread betting
Spread betting is any of various types of wagering on the outcome of an event, where the pay-off is based on the accuracy of the wager, rather than a simple "win or lose" outcome, such as fixed-odds betting or parimutuel betting. A spread is a range of outcomes and the bet is whether the outcome...
(14.7%), fixed odds betting terminals (11.2%) and betting exchange
Betting exchange
A betting exchange is an entity which provides "trading" facilities for retail or bookmaker customers to buy and sell contracts. Contracts are structured as binary options. Some betting exchanges may also offer CFD products...
s (9.8%). Additionally the report noted a 4% drop in overall gambling in the prior year, from a rate of 62% in 1999 to 58% in 2007. Significantly the 2007 prevalence survey combined with the 1999 prevalence survey suggest that despite the rapid growth of Internet gambling there has been no associated increase in the number of problem gamblers.
Money laundering
It has also been alleged that the largely unsupervised electronic funds transfers inherent in online gambling are being exploited by criminal interests to launderMoney laundering
Money laundering is the process of disguising illegal sources of money so that it looks like it came from legal sources. The methods by which money may be laundered are varied and can range in sophistication. Many regulatory and governmental authorities quote estimates each year for the amount...
large amounts of money.
However, according to a US GAO study, "Banking and gaming regulatory officials did not view Internet gambling as being particularly susceptible to money laundering, especially when credit cards, which create a transaction record and are subject to relatively low transaction limits, were used for payment. Likewise, credit card and gaming industry officials did not believe Internet gambling posed any particular risks in terms of money laundering."