US States Where Online Gambling is Illegal

Posted By: Date: 01/09/2013 at 12:00 am Leave a comment

US federal legislation prohibits online gambling at offshore operations, as they are not regulated by any US state or the US government. However, there are a number of online gambling sites that have not only opened their doors to US residents, they are actually based in, and licensed upon, US soil. These include such brands as the online poker sites FaceUp Gaming and SkillBet, and the official horse race betting site of Churchill Downs, TwinSpires.

Any American who has made use of these legal US gambling sites may have noticed that certain states are restricted from signing up a membership and/or paid membership. The reason for this is that there are a number of US states that have explicitly outlawed the act of gambling over the internet.

The following is a list of US states where online gambling is expressly prohibited by state legislature, and the corresponding statutes for each state. Note that some state residents are denied access to legal US poker and betting sites, but are not found on this list. This is likely because the current laws are undefined, yet shady enough that operators choose to avoid them.

Illinois

Illinois has expressly prohibited the act of online gambling. Under Illinois Compiled Statues, Section 5-2, Criminal Offenses; Article 28, Gambling and Related Offenses, Sec. 28-1 A-12:

Sec 28-1 A: A person commits gambling when he:  (12) Knowingly establishes, maintains, or operates an Internet site that permits a person to play a game of chance or skill for money or other thing of value by means of the Internet or to make a wager upon the result of any game, contest, political nomination, appointment, or election by means of the Internet. This item (12) does not apply to activities referenced in items (6) and (6.1) of subsection (b) of this Section.

Note: Items 6 and 6.1 of section B refer to the purchasing of state-run lottery sales, bought online or in a physical establishment.

By this statue, it is illegal to gamble over the internet, as well as operate an online gambling site that provides services to residents of Illinois.

Indiana

The state of Indiana has express laws that criminalize online gambling activities. Under Indiana Code, IC 35-45-5-1, Section 1, Definitions.

Gambling is defined as: risking money or other property for gain, contingent in whole or in part upon lot, chance, or the operation of a gambling device; but it does not include participating in:
(1) bona fide contests of skill, speed, strength, or endurance in which awards are made only to entrants or the owners of entries; or
(2) bona fide business transactions that are valid under the law of contracts

Section 1-L For purposes of this chapter:
(1) a card game; or
(2) an electronic version of a card game;
is a game of chance and may not be considered a bona fide contest of skill.

IC 35-45-5-2 Unlawful Gambling Sec. 2.

(a) A person who knowingly or intentionally engages in gambling commits unlawful gambling.
(b) Except as provided in subsection (c), unlawful gambling is a Class B misdemeanor.
(c) An operator who knowingly or intentionally uses the Internet to engage in unlawful gambling:

(1) in Indiana; or
(2) with a person located in Indiana;
commits a Class D felony.

IC 35-45-5-3 Professional Gambling; Professional Gambling over the Internet Sec. 3.

(a) A person who knowingly or intentionally:
(1) engages in pool-selling;
(2) engages in bookmaking;
(3) maintains, in a place accessible to the public, slot machines, one-ball machines or variants thereof, pinball machines that award anything other than an immediate and unrecorded right of replay, roulette wheels, dice tables, or money or merchandise pushcards, punchboards, jars, or spindles;
(4) conducts lotteries or policy or numbers games or sells chances therein;
(5) conducts any banking or percentage games played with cards, dice, or counters, or accepts any fixed share of the stakes therein; or
(6) accepts, or offers to accept, for profit, money, or other property risked in gambling;
commits professional gambling, a Class D felony. However, the offense is a Class C felony if the person has a prior unrelated conviction under this subsection.

(b) An operator who knowingly or intentionally uses the Internet to:
(1) engage in pool-selling:
(A) in Indiana;
or (B) in a transaction directly involving a person located in Indiana;
(2) engage in bookmaking:
(A) in Indiana; or
(B) in a transaction directly involving a person located in Indiana;
(3) maintain, on an Internet site accessible to residents of Indiana, the equivalent of:
(A) slot machines;
(B) one-ball machines or variants of one-ball machines;
(C) pinball machines that award anything other than an immediate and unrecorded right of replay;
(D) roulette wheels;
(E) dice tables; or
(F) money or merchandise pushcards, punchboards, jars, or spindles;
(4) conduct lotteries or policy or numbers games or sell chances in lotteries or policy or numbers games:
(A) in Indiana; or
(B) in a transaction directly involving a person located in Indiana;
(5) conduct any banking or percentage games played with the computer equivalent of cards, dice, or counters, or accept any fixed share of the stakes in those games:
(A) in Indiana; or
(B) in a transaction directly involving a person located in Indiana; or
(6) accept, or offer to accept, for profit, money or other property risked in gambling:
(A) in Indiana; or
(B) in a transaction directly involving a person located in Indiana; commits professional gambling over the Internet, a Class D felony.

By this statue, it is illegal to gamble over the internet, as well as operate an online gambling site that provides services to residents of Indiana.

Louisiana

The state of Louisiana specifically prohibits online gambling. Under the Louisiana Revised Statutes, Title 14 Criminal Law, Subpart B (Offenses Affecting General Morality);

Gambling is defined as: Gambling is the intentional conducting, or directly assisting in the conducting, as a business, of any game, contest, lottery, or contrivance whereby a person risks the loss of anything of value in order to realize a profit.

§90.3. Gambling by computer
A. The Legislature of Louisiana, desiring to protect individual rights, while at the same time affording opportunity for the fullest development of the individual and promoting the health, safety, education, and welfare of the people, including the children of this state who are our most precious and valuable resource, finds that the state has a compelling interest in protecting its citizens and children from certain activities and influences which can result in irreparable harm. The legislature has expressed its intent to develop a controlled well-regulated gaming industry. The legislature is also charged with the responsibility of protecting and assisting its citizens who suffer from compulsive or problem gaming behavior which can result from the increased availability of legalized gaming activities. The legislature recognizes the development of the Internet and the information super highway allowing communication and exchange of information from all parts of the world and freely encourages this exchange of information and ideas. The legislature recognizes and encourages the beneficial effects computers, computer programming, and use of the Internet resources have had on the children of the state of Louisiana by expanding their educational horizons. The legislature further recognizes that it has an obligation and responsibility to protect its citizens, and in particular its youngest citizens, from the pervasive nature of gambling which can occur via the Internet and the use of computers connected to the Internet. Gambling has long been recognized as a crime in the state of Louisiana and despite the enactment of many legalized gaming activities remains a crime. Gambling which occurs via the Internet embodies the very activity that the legislature seeks to prevent. The legislature further recognizes that the state’s constitution and that of the United States are declarations of rights which the drafters intended to withstand time and address the wrongs and injustices which arise in future years. The legislature hereby finds and declares that it has balanced its interest in protecting the citizens of this state with the protection afforded by the First Amendment, and the mandates of Article XII, Section 6 of the Constitution of Louisiana and that this Section is a product thereof.

B. Gambling by computer is the intentional conducting, or directly assisting in the conducting as a business of any game, contest, lottery, or contrivance whereby a person risks the loss of anything of value in order to realize a profit when accessing the Internet, World Wide Web, or any part thereof by way of any computer, computer system, computer network, computer software, or any server.

By Louisiana state law, all forms of gambling over the internet are illegal, with the dominant purpose being the absolute prevention of underage gambling.

Montana

Online gambling is explicitly outlawed in the state of Montana. The Montana Constitution, Article 3, Section 9, Gambling, states:

All forms of gambling, lotteries, and gift enterprises are prohibited unless authorized by acts of the legislature or by the people through initiative or referendum.

23-5-112 Definitions:
(12) (a) “Gambling” or “gambling activity” means risking any money, credit, deposit, check, property, or other thing of value for a gain that is contingent in whole or in part upon lot, chance, or the operation of a gambling device or gambling enterprise.
(19) “Illegal gambling enterprise” means a gambling enterprise that violates or is not specifically authorized by a statute or a rule of the department. The term includes:
(a) a card game, by whatever name known, involving any bank or fund from which a participant may win money or other consideration and that receives money or other consideration lost by the participant and includes the card games of blackjack, twenty-one, jacks or better, baccarat, or chemin de fer;
(b) a dice game, by whatever name known, in which a participant wagers on the outcome of the roll of one or more dice, including craps, hazard, or chuck-a-luck, but not including activities authorized by 23-5-160;
(c) sports betting, by whatever name known, in which a person places a wager on the outcome of an athletic event, including bookmaking, parlay bets, or sultan sports cards, but not including those activities authorized in Title 23, chapter 4, and parts 2, 5, and 8 of this chapter;
(d) credit gambling; and
(e) internet gambling.
(20) (a) “Internet gambling”, by whatever name known, includes but is not limited to the conduct of any legal or illegal gambling enterprise through the use of communications technology that allows a person using money, paper checks, electronic checks, electronic transfers of money, credit cards, debit cards, or any other instrumentality to transmit to a computer information to assist in the placing of a bet or wager and corresponding information related to the display of the game, game outcomes, or other similar information.

By this law, all forms of online gambling are illegal in Montana. Forms of gambling that are legal by state law in a public forum are strictly prohibited in regards to wagering over the internet.

Nevada

Nevada recently passed state legislature that decriminalizes the act of operating or participating in online poker, so long as the operator is fully licensed by the state of Nevada after undergoing extensive approval by the State Gaming Control Board.

NRS 463.016425 “Interactive gaming”? defined.
1.  “Interactive gaming”?means the conduct of gambling games through the use of communications technology that allows a person, utilizing money, checks, electronic checks, electronic transfers of money, credit cards, debit cards or any other instrumentality, to transmit to a computer information to assist in the placing of a bet or wager and corresponding information related to the display of the game, game outcomes or other similar information. The term:
(a) Includes, without limitation, Internet poker.
(b) Does not include the operation of a race book or sports pool that uses communications technology approved by the Board pursuant to regulations adopted by the Commission to accept wagers originating within this state for races, or sporting events or other events.
2.  As used in this section, “communications technology”? means any method used and the components employed by an establishment to facilitate the transmission of information, including, without limitation, transmission and reception by systems based on wire, cable, radio, microwave, light, optics or computer data networks, including, without limitation, the Internet and intranets.

NRS 463.745 Legislative findings and declarations.  The Legislature hereby finds and declares that:
1.  The State of Nevada leads the nation in gaming regulation and enforcement, such that the State of Nevada is uniquely positioned to develop an effective and comprehensive regulatory structure related to interactive gaming.
2.  A comprehensive regulatory structure, coupled with strict licensing standards, will ensure the protection of consumers, prevent fraud, guard against underage and problem gambling and aid in law enforcement efforts.
3.  To provide for licensed and regulated interactive gaming and to prepare for possible federal legislation, the State of Nevada must develop the necessary structure for licensure, regulation and enforcement.

The 2011 amendments to the Nevada Revised Statues (including NRS 463.745 above) have not yet been clarified to the fullest extent, but have permitted the Nevada Gaming Commission and State Gaming Control Board to begin processing license applications and approving those that meet the strict guidelines. Internet Poker is currently the only online gaming activity that operators, service providers, distributors, manufacturers, affiliate companies and other related entities may offer under current licensing applications. Until the legislation is fully defined (expected sometime in mid- to late-2013), no licensed operator may yet offer real-money poker games over the internet.

Oregon

Oregon state law prohibits most forms of online gambling, but provides subsections that entitle pari-mutuel online horse race betting from state licensed operators. According to Oregon Revised Statutes (OSR), Chapter 167:

167.109 Internet gambling.
(1) A person engaged in an Internet gambling business may not knowingly accept, in connection with the participation of another person in unlawful gambling using the Internet:
(a) Credit, or the proceeds of credit, extended to or on behalf of such other person, including credit extended through the use of a credit card;
(b) An electronic funds transfer or funds transmitted by or through a money transmission business, or the proceeds of an electronic funds transfer or money transmission service, from or on behalf of the other person;
(c) Any check, draft or similar instrument that is drawn by or on behalf of the other person and is drawn on or payable at or through any financial institution; or
(d) The proceeds of any other form of financial transaction that involves a financial institution as a payor or financial intermediary on behalf of or for the benefit of the other person.
(2) Violation of subsection (1) of this section is a Class C felony.

167.114 Application of ORS 167.109 and 167.112 to Oregon Racing Commission.
ORS 167.109 and 167.112 do not apply to activities licensed and regulated by the Oregon Racing Commission under ORS chapter 462. [2001 c.502 §5]

462.140 Prohibitions concerning bookmaking, betting; track take; computation, use of breaks. (1) A person may not conduct or commit, attempt or conspire to conduct or commit pool selling, bookmaking, or circulate handbooks, or bet or wager on any licensed race meet, other than by the mutuel method. All moneys wagered in Oregon must be accounted for through a computerized mutuel wagering system in use by an operating race meet in this state and approved by the Oregon Racing Commission. Wagering into pools outside of Oregon via telephone or other device is prohibited unless the wagering information is transmitted by a licensee that conducts off-race course mutuel wagering pursuant to ORS 462.700 to 462.740.

462.740 Rules; compliance with federal law.(2) In order to provide for the lawful operation of off-race course mutuel wagering for wagering on horse races at race courses outside this state, the commission is authorized to enter into contracts or agreements with other governmental or private agencies or associations and to perform all other acts necessary to comply with the Interstate Horseracing Act of 1978, 15 U.S.C. 3001 to 3007, as amended.

By these statutes, online poker and casino gambling are illegal, but online horse race betting in pari-mutuel format is exempt at facilities where the appropriate licensing is obtained by the operator. However, the fault of illegal online gambling falls upon the operator who “knowingly accepts“? financial transactions for the purpose of illegal online gambling.

South Dakota

South Dakota clearly defines the state of internet gambling to be unlawful in any and all venues except for those supplied or licensed by the South Dakota Lottery. The South Dakota Codified Laws, Chapter 22-25A, refers directly to the unlawful acts and penalties for engaging in or facilitating online gambling.

CHAPTER 22-25A INTERNET GAMBLING

22-25A-1 Bet or wager defined.
For the purposes of this chapter, the term, bet or wager, means to directly or indirectly take, receive, or accept money or any valuable thing with the understanding or agreement that the money or valuable thing will be paid or delivered to a person if the payment or delivery is contingent upon the result of a race, contest, or game or upon the happening of an event not known to be certain. Bet or wager does not include the purchase, sale, or trade of securities or commodities under state or federal law.

22-25A-7 Internet betting by person engaged in gambling business prohibited .
Except as provided in § 22-25A-15, no person engaged in a gambling business may use the internet or an interactive computer service to bet or wager.

22-25A-8 Establishment of internet gambling business prohibited.
Except as provided in § 22-25A-15, no person may establish a location or site in this state from which to conduct a gambling business on or over the internet or an interactive computer service.

22-25A-15 Inapplicability of chapter to state lottery or commission on gaming.
This chapter does not apply to the South Dakota Lottery and its licensees, who are engaged in conduct in furtherance of activity expressly authorized, licensed, and regulated under the provisions of chapter 42-7A or to the South Dakota Commission on Gaming and its licensees, who are engaged in conduct in furtherance of activity expressly authorized, licensed, and regulated under the provisions of chapters 42-7 and 42-7B.

By these laws, all forms of wagering over the internet are illegal. The only permissible form of online gambling is the purchase of lottery tickets for the South Dakota Lottery from licensed operators.

Washington

The state of Washington made it clear that gambling over the internet would be illegal with a simple notation to its legislation. Under Washington Revised Code (WRC) Chapter 9, Section 46, Subsection 240 [RCW 9.46.240], the following notation was amended:

Note: State policy — 2006 c 290: “It is the policy of this state to prohibit all forms and means of gambling, except where carefully and specifically authorized and regulated. With the advent of the internet and other technologies and means of communication that were not contemplated when either the gambling act was enacted in 1973, or the lottery commission was created in 1982, it is appropriate for this legislature to reaffirm the policy prohibiting gambling that exploits such new technologies.” [2006 c 290 § 1.]

The Washington Revised Code continues by defining what is, and is not, considered “gambling”?:

RCW 9.46.0237 “Gambling.”
as used in this chapter, means staking or risking something of value upon the outcome of a contest of chance or a future contingent event not under the person’s control or influence, upon an agreement or understanding that the person or someone else will receive something of value in the event of a certain outcome.Gambling does not include  fishing derbies as defined by this chapter, parimutuel betting and handicapping contests as authorized by chapter 67.16 RCW, bona fide business transactions valid under the law of contracts, including, but not limited to, contracts for the purchase or sale at a future date of securities or commodities, and agreements to compensate for loss caused by the happening of chance, including, but not limited to, contracts of indemnity or guarantee and life, health, or accident insurance. In addition, a contest of chance which is specifically excluded from the definition of lottery under this chapter shall not constitute gambling.

The definition of “gambling“? leaves a lot of wiggle room for the future legalization of skill games, including the possible legalization of online poker, but until the notation above is further examined and amended by the state, Washington does not condone any online wagering of any kind within its borders.

Wisconsin

Wisconsin strictly prohibits any type of wagering via internet communications. Under Wisconsin Statues, Chapter 945, Gambling:

945.01 Definitions. In this chapter:(1) BET. A bet is a bargain in which the parties agree that, dependent upon chance even though accompanied by some skill, one stands to win or lose something of value specified in the agreement.

But a bet does not include:
(a) Bona fide business transactions which are valid under the law of contracts including without limitation:
1. Contracts for the purchase or sale at a future date of securities or other commodities, and
2. Agreements to compensate for loss caused by the happening of the chance including without limitation contracts of indemnity or guaranty and life or health and accident insurance;
(b) Offers of purses, prizes or premiums to the actual contestants in any bona fide contest for the determination of skill, speed, strength, or endurance or to the bona fide owners of animals or vehicles entered in such contest;
(c) Participation in bingo or a raffle conducted under ch. 563.
(d) Pari-mutuel wagering subject to ch. 562.
(e) Participation in a lottery conducted under ch. 565.

(6) WIRE COMMUNICATION FACILITY.
“Wire communication facility” means any and all instrumentalities, personnel and services, and among other things the receipt, forwarding or delivery of communications used or useful in the transmission of writings, signs, pictures and sounds of all kinds by means of wire, cable, microwave or other like connection between the points of origin and reception of such transmission.

945.02 Gambling.
Whoever does any of the following is guilty of a Class B misdemeanor:
(1) Makes a bet; or
(2) Enters or remains in a gambling place with intent to make a bet, to participate in a lottery, or to play a gambling machine; or
(3) Conducts a lottery, or with intent to conduct a lottery, possesses facilities to do so.

945.03 Commercial gambling.
(1m) Whoever intentionally does any of the following is engaged in commercial gambling and, except as provided in sub. (2m), is guilty of a Class I felony:
(a) Participates in the earnings of or for gain operates or permits the operation of a gambling place; or
(b) For gain, receives, records or forwards a bet or offer to bet or, with intent to receive, record or forward a bet or offer to bet, possesses facilities to do so; or
(c) For gain, becomes a custodian of anything of value bet or offered to be bet; or
(d) Conducts a lottery where both the consideration and the prize are money, or with intent to conduct such a lottery, possesses facilities to do so; or
(e) Sets up for use for the purpose of gambling or collects the proceeds of any gambling machine; or
(f) For gain, maintains in this state any record, paraphernalia, tickets, certificates, bills, slip, token, paper, writing or other device used, or to be used, or adapted, devised or designed for use in gambling; or
(g) For gain, uses a wire communication facility for the transmission or receipt of information assisting in the placing of a bet or offer to bet on any sporting event or contest, or for the transmission of a wire communication which entitles the recipient to receive money or credit as a result of a bet or offer to bet.to receive money or credit as a result of a bet or offer to bet.

562.11 Prohibited wagering activities. No person may:
(1) Place any wager on a race at any location except at a racetrack.

By these statutes, it is illegal to wager anything over the internet in Wisconsin. It is unlawful to use a “wire communication facility“?, which by definition includes the use of internet communications as a “connection between two points of origin“?. All wagering, including pari-mutuel betting, may only be done at a brick-and-mortar establishment that hosts an event eligible for wagering in, and licensed by, the state of Wisconsin.

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