Echeck Casinos and UIGEA
UIGEA

The Unlawful Internet Gambling Enforcement Act is the 8th title of the Safe Port Act that was introduced on September 30th, 2006 by the United States Congress. In fact, the UIGEA was not originally included in the Safe Port Act of two weeks earlier but was tagged to it on the 30th. It is interesting to note that this particular title was never reviewed in the United States Senate before it was passed as part of a much larger law. The law, as it was passed, did not include any form of online lottery, fantasy sporting leagues or horse race gambling.

The main consideration of the UIGEA was to make illegal all transfers of money from any financing entity to any online betting sites. In this way, the act was meant to make it impossible for players from the United States to legally make monetary deposits to online casino websites by using any method. In this way, the play of casino based games on the Internet is not made illegal by the act. The paying of any money for this service in order to make available the possibility for additional money is illegal if the gambler is a citizen of the United States and is paying a casino based in the United States.

Effectiveness of the UIGEA

This law certainly looks scary for online gamblers. Unfortunately for the lawmakers, it certainly has more bark than bite. In fact, in most cases, the UIGEA is absolutely meaningless. The problem with this act is the fact that it cannot affect the laws on online gambling at the state level. In states where gambling is illegal, it is already clear that online gambling is also illegal. However, there are no laws prohibiting gambling at the federal level.

So why was the law passed in the first place? Well, this law was intended to make it easier for existing anti-gambling laws to be enforced and to allow more of an opportunity for smaller operations to hit the ground running. The UIGEA is often misinterpreted, even by professionals, to forbid gambling by circumventing state laws and making it illegal to deposit money into an online casino account. However, no court will ever uphold this attempt to get around state law at the federal level.

As you can hopefully see, this law clearly forbids the deposit of any money into an online casino account. However, this is a fine example of a law for which there are no clear consequences because such consequences would be unconstitutional. The people that passed this law were not fools however. The act effectively helped to end the already illegal transfer of funds from states where gambling is forbidden. By doing so, many large sites lost some revenue from these unlawful sources and many of the newer sites were able to take hold of such a niche market.

The only real effect that this act has on online gambling is in the process of transmitting funds over state lines and thus creating an issue that is subject to multiple state laws. In order to fully interpret how the UIGEA works in coherence with state laws, one would need a full understanding of the laws in place in each state. What this means for the individual is far less confusing. In short, if you reside in a state where gambling is considered to be legal, you will never have an issue with the UIGEA.

Penalties for UIGEA Violation

At this point, we come to a major consideration when examining this act. There are no specific penalties set in place for the violation of this act. In fact, all penalties that can stem from the guidelines of this act are covered under the laws of a state that has made gambling illegal. If a company is in violation of the UIGEA, the penalties will be enacted based on these laws, not the UIGEA.

Which States Prohibit Internet Gambling? Most of the time, it is not enough to say that all gambling is illegal when a state passes laws making online gambling illegal. Some states that have made Internet gambling illegal recognize that games of skill do not fall under the same laws. For example, Blackjack is often not considered to be illegal in states where online gambling is forbidden. As a general rule, if the game requires more skill than luck, it is not illegal in most cases. A clear cut example of an online casino game that would be considered illegal in the following states are slot machines.

The following states have passed laws making online gambling illegal:

Illinois - All types of gambling.
Indiana - Games of skill are allowed.
Louisiana - All types of gambling.
Montana - Uncertain as to whether games of skill are allowable.
Nevada - Games of skill are allowed.
Oregon - Games of skill are allowed.
South Dakota - Games of skill are allowed.
Washington - Games of skill are allowed.
Wisconsin - Games of skill are allowed.

In all states where Internet gambling is illegal, first time (and often second time) offenses are considered to be a misdemeanor. Professional gambling that is deemed to be the participant's only source of income is often considered to be a felony.

Is it Legal to Gamble in the United States?

Based on the UIGEA and other similar laws, it is not considered to be illegal to gamble in the United States. All effective laws are in place at the state level. Obviously, if your resident state prohibits gambling, it is illegal to gamble online. However, as many states that have forbidden online gambling also take games of skill into account, you may not be entirely forbidden from enjoying many of the websites that are available for your use.

The only two states that have made all types of gambling illegal are Illinois and Louisiana. In these states, the UIGEA is effective and you can face misdemeanor penalties for participating in any online gambling session. However, in almost every state, lotteries that are based online are not covered by the UIGEA or other state laws and are therefore not illegal.
Last Updated ( Friday, 05 June 2009 18:59 )