We recently reported that online poker was legalized in the state of Nevada and now we’re happy to report that the US DoJ decided that the Federal Wire Act of 1961 only applies to sports betting. Back in 2009 New York and Illinois submitted a proposal to use the internet and processors located out-of-state to processors to sell lottery tickets to customers that live in-state.
The US DoJ released a report right before Christmas Day that stated “Interstate transmissions of wire communications that do not relate to a sporting event or contest fall outside the reach of the Wire Act”. This basically means that it would be legal to run online poker rooms that offered interstate poker games according to Federal law. As long as the states that are running the poker games have legalized online poker there is no federal law that would prevent interstate poker games from being legal.
If the Wire Act does only apply to sports betting this would mean that it’s possible to legally run interstate poker games or even run poker games with international poker players legally. Nevada is going to be the 1st state with regulated online poker and the operators in Nevada will have a huge head start on the rest of the industry. 888 Holdings has applied for a license and if they do receive a license they could run poker games with an international player pool as long as online poker is legal in the jurisdiction.
This should also help other states decide whether or not they should legalize and regulate online poker. Other states would be able to partner with licensed operators in Nevada if they wanted to, which would allow them to run interstate poker games. I think this would make the decision to regulate online poker in other US states a lot easier.
Initially most poker games will be intra-state only, but with the recent news from the US DoJ that the Wire Act only applies to sports betting it won’t be long before states form deals with each other to offer legalized and regulated interstate online poker games. 2012 is shaping up to be a huge year for online poker in the United States and I think we’re going to see a lot of progress towards a regulated industry that earns lots of tax revenue for the states that legalize online poker.
The US DoJ didn’t specifically say that online poker doesn’t apply to the Wire Act, but with their statement that we quoted at the top of this article it’d be hard for the DoJ to say that poker is a sporting event or lottery.
