The Commerce Clause and the First Amendment in Online Gambling
With technological advances, the gambling industry has become more competitive, and now people can bet on sports, casino games, and even virtual poker and bingo online. A wide range of online gambling games are available, with a variety of themes, graphics, and gameplay. Online casinos offer traditional and popular titles like video slots, poker, and bingo. Most of these gaming sites are regulated by the UKGC and MGA, and provide fast banking options. Mobile apps are also available, allowing players to play wherever they are.
The United States has a number of federal criminal statutes that are directly implicated in cases involving illegal Internet gambling. One of the primary crimes is laundering. This is the act of transferring funds or concealing the identity of a bettor in order to evade taxes or disguise the identity of a person involved in an illicit activity. Some of these statutes include Section 1956, which provides for the crime of laundering with the intent to promote the illicit activities of others.
Another federal law that is indirectly implicated in these types of cases is the Travel Act. When an online gambling site or player uses an interstate facility for unlawful activities, this is a violation of the Travel Act. In addition, the Federal Communications Commission may discontinue furnishing or maintaining facilities.
Finally, a number of state laws are impacted by these violations. Those states have cited concerns that their jurisdictions will be overrun with unlicensed gambling. For instance, the Florida Department of Law Enforcement recently filed a suit against a casino operator, arguing that it violated the Travel Act when it conducted business in Florida without a license. State officials have also expressed concerns that the Internet could be used to bring illegal gambling into their jurisdictions.
As a result, the question of the scope of the Commerce Clause and whether the government can regulate Internet gambling is not as settled as many would have you believe. However, the commercial nature of the gambling business seems to satisfy the Commerce Clause concerns.
Several cases have been decided in the past few years regarding the United States’ ability to enforce its gambling laws. Some of the cases have been decided on the grounds of the Commerce Clause and others have been decided on constitutional grounds.
While there is much disagreement about the scope of the Commerce Clause, the debate has been less contentious in terms of the First Amendment. Several attacks have been made on the Due Process Clause. They have primarily been unsuccessful. Even those attacks based on the First Amendment guarantee of free speech have not enjoyed a lot of success.
However, the presence of an interstate element in these types of cases frustrates state enforcement policies. For example, the Attorney General has a prohibition on accepting financial instruments from illegal Internet bets. This has been an issue for PayPal, which was warned by federal prosecutors that it might face prosecution. Other online gambling companies also have been warned about their financial liabilities.