Gambling Laws

American Justice: How does each state view online gambing?

By Hartley Henderson

MajorWager.com

The last article discussed the legalities of online gambling in the United States. As mentioned the series is not intended to deter gamblers from wagering online, but simply to show whether betting in particular areas within the United States is prohibited.

It was clearly shown in the first article that recreational wagering is not a crime by any of the federal statutes, so if it is illegal, it would have to be specified by the individual state. The following articles will look at states alphabetically.

Alabama

Alabama does not have any statutes related to online gambling. If a person is caught wagering illegally then he is guilty of a misdemeanour although social gambling is permitted. The state doesn't define "illegal" gambling and seems to leave the definition up to the feds. Since online gambling is not prohibited federally and since there is no law against it specifically within the state, recreational online gambling in Alabama can be deemed not to be an offence.

Alaska

Alaska was once known for the card games and gambling at the time of the Alaskan gold rush. It is in the very fibre of the state, but ironically, there are no casinos or state run lotteries in Alaska. Nevertheless, state laws do not prohibit recreational gambling and clearl allow social gambling. If a person is found to be in the business of gambling (i.e. whether a professional gambler or profiting from the activity as the proprietor of a bookmaking service or illegal gambling devices) he is subject to a felony conviction in the state punishable by prison time. It should also be noted that Congressman Don Young from Alaska is a strong proponent of Barney Frank's law to legalize and regulate online gaming.

Arizona

One would expect the home state of Jon Kyl to have one of the most rigid set of gambling laws on the books. After all, if the Senator is so set on dictating moral laws for the entire nation then surely he would be lobbying heavily to make all gambling illegal in his home state. Unfortunately for Kyl, it appears that legislators in Arizona don't fully agree with his stand. While simple gambling (i.e. making a profit from games of chance) is specified as illegal on the books, the penalty is just a misdemeanor and subject to a fine. Moreover, there are several exemptions carved out for social gambling and games of amusement. The interesting note regarding the social gambling exemption is that based on its definition it would include poker and therefore online poker. Social gambling per Arizona's definition is as follows:

Gambling is not illegal in Arizona if it meets the following criteria

1- The players only win money against each other

2- The players are at least 21 years of age

3- No players have any advantage other than their own skill

Needless to say, that would apply to poker; and since there is no specific law prohibiting online betting of any sort in the state, by deduction online poker in the state of Arizona is perfectly legal. If a person is involved in the business of non-regulated gambling within the state of Nevada he is subject to a felony conviction.

Arkansas

The home state of the leading candidate for the next election, Hillary Clinton does disallow social gambling unlike the prior 3 states. In fact, if a poker game is raided by the police all participants could be fined a maximum of 25 bucks. The fact that the average pot of any game would likely be far more than that, and in some games may even be an ante, one can argue that the law is irrelevant. It appears the state's laws are very antiquated and the legislators have little interest in the area of gambling. There is absolutely nothing on the books related to internet wagering, and for the social gambler there is not even a misdemeanour penalty handed out - just the 25 buck fine.

California

One of the more liberal states in the nation, it's not surprising that gambling laws are not a priority. California is still one of few states that have specialty poker rooms set up outside of casinos and governor Arnold Schwartzenegger handed out numerous licenses to tribal gaming groups. It also appears Schwartzenegger is interested in seeing how the state can profit from online gaming. All crimes related to gambling on California's books are for individuals that are illegally running a gambling business and the penalties are misdemeanor citations. There is nothing on the books relating to the recreational gambler or simple gambling for profit or otherwise. Furthermore, internet wagering is not mentioned anywhere in the state laws. Three Congressmen from California are currently co-sponsors of Barney Frank's Internet Gambling Regulation bill.

Colorado

Like the other states, Colorado does not list casual gambling as a felony. Recreational gambling is seen as a petty offense and is not really addressed in the gambling code at all. Professional gambling is singled out as a felony crime, but only on the 3rd offense. It is interesting to note that one of the supporters for Barney Frank's bill to repeal the UIGEA is Congressman Ed Perlmutter, who was just elected in the 2006 midterm election. Perlmutter is a Director of law at a major Colorado law firm and was on various judicial boards for the first district of Colorado. Consequently his decision to try and have the law repealed is significant.

Connecticut

Connecticut does state that any person who engages in gambling is guilty of a misdemeanour. In fact, any person who witnesses someone gambling in the state and does nothing about it is guilty of a crime. Looking at past cases in the state I have not been able to find any recreational gambler who has ever been cited for anything in the last 2 years, so the law is likely on the books but not enforced. Of course as a petty misdemeanour it holds about as much concern to the police as littering does. There is nothing on the state books specifically related to internet wagering.

Delaware

Delaware, like the others thus far does not specify anything related to internet wagering in its statutes. As for recreational gaming in other areas, the only crime that is singled out in the books is for people who play dice games such as craps or foreign lotteries. Any other misdemeanour crimes are for those people involved in the gambling business.

District of Columbia

Like most other things in Washington, DC, the laws related to gambling are confusing to say the least. Looking closely at the law it would appear that anyone caught in a gaming house or gambling "illegally" is subject to imprisonment. At the same time what is illegal is not specified, although it appears that betting into pools or sporting games can land one in jail for up to 6 months.

This is the exact wording from section 22-1708 of the Criminal Code for DC as listed on www.westlaw.com:

"It shall be unlawful for any person, or association of persons, within the District of Columbia to purchase, possess, own, or acquire any chance, right, or interest, tangible or intangible, in any policy lottery or any lottery, or to make or place a bet or wager, accept a bet or wager, gamble or make books or pools on the result of any athletic contest. For the purpose of this section, the term "athletic contest" means any of the following, wherever held or to be held: a football, baseball, softball, basketball, hockey, or polo game, or a tennis, golf, or wrestling match, or a tennis or golf tournament, or a prize fight or boxing match, or a trotting or running race of horses, or a running race of dogs, or any other athletic or sporting event or contest. Any person or association of persons violating this section shall be fined not more than $1,000 or imprisoned not more than 180 days, or both."

It's also interesting to note that if one is in possession of a lottery ticket they can be imprisoned in DC. Those involved in the gambling business are subject to several years in prison if caught. There is currently nothing on the books of the state that specifies internet wagering.

Florida

Florida's state laws regarding gambling are quite lengthy. The activity goes on for 2 chapters and discusses everything under the sun, which isn't surprising since Florida offers gambling on pretty much everything including greyhound racing jai-alai and gambling ships that dock just outside international waters. When it's all broken down, however, the laws of the state seem pretty straight forward: It is a misdemeanour offense to be involved in any form of gambling that is not specifically made legal by the state provided those bets exceed $10. For wagers of $10 or less the state does not consider the bettor to be guilty of anything. Nevertheless, because only state endorsed games or tournaments are technically considered legal, it can be deduced that online gambling is likely illegal also. Like most states, however, the bulk of the laws are related to those in the business of taking wagers or in possession of illegal gambling devices. The recreational bettor is really not mentioned, although the following is clearly specified in the books:

"Section 849.08 Whoever plays or engages in any game at cards, keno, roulette, faro or other game of chance, at any place, by any device whatever, for money or other thing of value, shall be guilty of a misdemeanor of the second degree, punishable as provided in s. 775.082 or s. 775.083. Looking at section 775.082 the penalty for the misdemeanour is quite harsh: (4) A person who has been convicted of a designated misdemeanor may be sentenced as follows: (a) For a misdemeanor of the first degree, by a definite term of imprisonment not exceeding 1 year; (b) For a misdemeanor of the second degree, by a definite term of imprisonment not exceeding 60 days." It is thus not surprising that many offshore sportsbooks, poker rooms and casinos refuse to allow citizens of Florida to register an account. While the offshore gambling site is likely immune from penalty as they aren't located in the U.S., the penalty for citizens is too severe to take the risk.

Two Congressmen from Florida, Robert Wexler and Alcee Hastings (who of course was famous for winning a seat in Congress after being impeached as a judge), are supporters of Barney Frank's gambling enforcement bill.

Georgia

Georgia's laws are mostly related to gambling operators and the penalties are severe. Those involved in the business of gambling are subject to a $20,000 and up to 5 years in prison if convicted.

The recreational gambler is mentioned also, although it appears the penalty for recreational gambling is only a misdemeanor fine. Here is the exact wording from Georgia's criminal code:

"Section 16-12-21 (a) A person commits the offence of gambling when he: (1) Makes a bet upon the partial or final result of any game or contest or upon the performance of any participant in such game or contest; (2) Makes a bet upon the result of any political nomination, appointment, or election or upon the degree of success of any nominee, appointee, or candidate; or (3) Plays and bets for money or other thing of value at any game played with cards, dice, or balls. (b) A person who commits the offence of gambling shall be guilty of a misdemeanour"

There is nothing on the books related specifically to internet wagering.

Hawaii

Hawaii and Utah have the distinction of being the only two U.S. states where there is no gambling whatsoever. Hawaii doesn't even have lotteries. Recreational gambling is listed in the criminal code of the state and is a misdemeanour offence punishable by prison time for those who participate in gambling. Internet wagering is not singled out, but it need not be since all forms of gambling are illegal in the state. For that reason few, if any, internet wagering sites will accept residents of Hawaii. Here is the exact wording of what the state considers "gambling" which is punishable under section 712-1223 of the state criminal code:

"A person engages in gambling if he stakes or risks something of value upon the outcome of a contest of chance or a future contingent event not under his control or influence, upon an agreement or understanding that he or someone else will receive something of value in the event of a certain outcome."

The next article will look at states from I-M.

Online Gambling Laws State by State Idaho to Michigan...

By Hartley Henderson

Idaho

Idaho disallows all gambling except those activities which are specifically permitted by the state. In fact, the rule against gambling is written into the state's constitution. Below is Article III Section 20 from that constitution. The fact that the state prohibits all forms of gambling indicates that it intended to disallow online gambling as well, although there is nothing specifically in their laws prohibiting the activity.

Section 20: Gambling

(1) Gambling is contrary to public policy and is strictly prohibited except for the following:

a. A state lottery which is authorized by the state if conducted in conformity with enabling legislation; and

b. Pari-mutuel betting if conducted in conformity with enabling legislation; and

c. Bingo and raffle games that are operated by qualified charitable organizations in the pursuit of charitable purposes if conducted in conformity with enabling legislation. (2) No activities permitted by subsection (1) shall employ any form of casino gambling including, but not limited to, blackjack, craps, roulette, poker, bacarrat, keno and slot machines, or employ any electronic or electromechanical imitation or simulation of any form of casino gambling. (3) The legislature shall provide by law penalties for violations of this section. (4) Notwithstanding the foregoing, the following are not gambling and are not prohibited by this section:

a. Merchant promotional contests and drawings conducted incidentally to bona fide nongaming business operations, if prizes are awarded without consideration being charged to participants; and

b. Games that award only additional play.

Illinois

Like Idaho, Illinois disallows all forms of gambling including recreational betting. Illinois is also the first state in the alphabetical list to specifically specify internet wagering as a form of prohibited gambling. The following is from their criminal code in section 720

(a-5) "Internet" means an interactive computer service or system or an information service, system, or access software provider that provides or enables computer access by multiple users to a computer server, and includes, but is not limited to, an information service, system, or access software provider that provides access to a network system commonly known as the Internet, or any comparable system or service and also includes, but is not limited to, a World Wide Web page, newsgroup, message board, mailing list, or chat area on any interactive computer service or system or other online service.

(a-6) "Access" and "computer" have the meanings ascribed to them in Section 16D-2 of this Code.

While gambling itself is a misdemeanor on all counts, anyone in the gambling business faces a felony charge on second and subsequent conviction.

For that reason, almost every online gambling site lists Illinois as a prohibited state for registration.

Indiana

Indiana is best known for basketball which is perhaps why the state has such strict gambling laws, given the past incidences with game fixing in college hoops. The state has determined that gambling means risking money to make money and if anyone is caught doing so they are guilty of a misdemeanor. If anyone is caught in the business of gambling they are committing a felony. The "business of gambling" in Indiana includes operating a gambling website. Furthermore anyone that has a business that connects to an internet betting site is considered to be guilty as well. Consequently, the state does not recognize recreational gambling by its citizens as legal and hence most gambling websites forbid citizens of Indiana from registering with their site.

Iowa

Iowa has strict laws against gambling for any activity that is not sanctioned by the state itself. The state does permit various kinds of social gaming such as charitable events, pari-mutuel wagering and what it titles "game nights", but otherwise recreational gambling is disallowed with one exception. That exception allows for gambling between individuals provided the amount wagered is less than $50 in a 24 hour period. That certainly brings back the definition of penny ante poker. There is no direct mention of internet wagering within the laws itself. The penalty for being found to have wagered over the permitted amount is what the state calls a "serious misdemeanor" i.e. jail time. That said, I have been unable to find any cases of recreational gamblers in Iowa that have been convicted of a crime in the last 2 years. There is no mention of internet wagering in their statutes.

Kansas

Home state of the Jayhawks, Kansas's laws are clearly designed to dissuade those in the business of gambling. Anyone convicted of owning a gambling establishment or device and those commercially in the business of non-state sanctioned gambling is guilty of a felony and subject to strict jail time. Those who are caught betting for money, even recreationally, are guilty of what the state titles a Class B non-person misdemeanour which entails a fine of $500 to $1000 and/or 2 days in the clink. Again, there are no recent cases of anyone that has been jailed for recreational gambling in Kansas and there is nothing on the books that specifically discusses internet wagering.

Kentucky

When one thinks of Kentucky the two things that come to mind are bourbon and horse racing, not necessarily in that order. So it shouldn't be surprising that Kentucky has relatively tame laws in relation to other states when dealing with recreational gambling. The state is clear to distinguish between "advanced" gaming (i.e. those in the business of betting) and "the player" i.e. those who simply gamble. While the advanced gambler is subject to a felony conviction, the player is essentially let off provided the players are wagering among themselves. There is also no specific mention of the internet, so it can be implied that recreational wagering on internet sites from Kentucky is legal since federal law doesn't prohibit it. The following is the exact wording from their statutes (as poorly worded as it is) which shows that the player is exempt.

"A person who gambles at a social game of chance on equal terms with other participants does not otherwise advance gambling activity by performing acts, without remuneration or fee, directed toward the arrangement or facilitation of the game as inviting persons to play, permitting the use of premises therefor and supplying equipment used therein."

Louisiana

Looking at the gambling statutes of Louisiana, one has to wonder if Jon Kyl wrote the laws for the state. The statutes of the state do not prohibit recreational or social gambling with the exception of internet wagering. In fact, gambling by computer was given a special section within the Louisiana statutes under RS 14:90.3. Aside from just mentioning that gambling by computer or accepting wagers on the internet is illegal, the legislators found it necessary to go into a long diatribe as to why the activity is illegal. One can just hear the southern twang and moral chest thumping as this was written:

§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. Skipping the rest of the diatribe and getting to the nitty gritty the punishment for internet betting in Louisiana is steep

C. Whoever commits the crime of gambling by computer shall be fined not more than five hundred dollars, or imprisoned for not more than six months, or both. Bottom line - don't gamble on the internet if you live in Louisiana, although Congressman Charlie Melancon is on board to defeat the UIGEA.

Maine

The most north-east state has very little related to recreational gambling in its statutes. The state distinguishes between those in the gambling industry and the player and has determined that a simple "player" is exempt from the law. Having said that, it also clearly states that the "player" exemption is only for bets between players where no company profits as an intermediary. Nevertheless, the statute seems to focus on those in the business of gambling and is not concerned with recreational gambling. If someone is convicted of simple gambling in a non-social way (i.e. with a bookmaker or a gaming company) they are guilty of a misdemeanour. Again, no recent cases have been noted of anyone being arrested for recreational gambling in that state. There is nothing on the books related to internet wagering. Maryland Considering how severe the penalties are for recreational gambling in DC, it is not surprising that Maryland has similar statutes. In the definition of gambling in the laws of the state the first two paragraphs say all that needs to be said

12-102. Betting, wagering, gambling, etc. (a) Prohibited.- A person may not: (1) bet, wager, or gamble; (2) make or sell a book or pool on the result of a race, contest, or contingency; (3) establish, keep, rent, use, or occupy, or knowingly allow to be established, kept, rented, used, or occupied, all or a part of a building, vessel, or place, on land or water, within the State, for the purpose of: (i) betting, wagering, or gambling; or (ii) making, selling, or buying books or pools on the result of a race, contest, or contingency; or

(4) receive, become the depository of, record, register, or forward, or propose, agree, or pretend to forward, money or any other thing or consideration of value, to be bet, wagered, or gambled on the result of a race, contest, or contingency.

(b) Penalty.- A person who violates this section is guilty of a misdemeanor and on conviction is subject to imprisonment for not less than 6 months and not exceeding 1 year or a fine of not less than $200 and not exceeding $1,000

Imagine spending 6 months in jail for placing a bet. Heck, drunk drivers don't even get that long of a sentence on the first offense. The only gambling that the state seems to exempt are pari-mutuel wagering at tracks like Pimlico, slot machines in certain circumstances and bingo. There is no mention whatsoever of the internet, but the fact that the first line states "A person may not bet wager or gamble" seems to encompass any eventuality where that can occur.

Massachusetts

The home state of Barney Frank, the congressman that is leading a charge to overturn the UIGEA, what he called "the stupidest law ever passed" along with supporters James McGovern and Michael Capuano, one would expect the laws to be fairly liberal laws when it comes to recreational gambling, but such is not the case. Massachusetts specifically disallows "illegal" betting but then fails to describe exactly what that entails. The statutes are also fixated on stopping people from conducting lotteries and for placing or receiving bets via. telephone. There is absolutely no mention of player to player gambling in the statutes or betting by way of computer. As such, it is hard to understand what Massachusetts law says about recreational gambling. But since it only disallows "illegal betting" which they have failed to define, one can assume they are referring to gambling outlawed by the feds which is why they mention the telephone over and over in their statute (i.e. the wire act). The bottom line for Massachusetts is that it should be safe to wager via computer at your favorite site or socially with friends, but stay away from that dreaded telephone. Either way, the penalty is a misdemeanor subject to a fine.

Michigan

Of all the states, Michigan seems to have the most convoluted logic in the development of their gambling statutes. First of all, the penalties for gambling infractions rank up there with capital crimes like manslaughter or breaking and entering with penalties of up to 10 years in prison and/or a $100,000 fine. Second, aside from operating a gambling business or bookmaking, the law also applies as follows in section 432.218 of the criminal code

(e) Except as otherwise provided by the board, uses or possesses with the intent to use a device to assist in doing any of the following:

(i) Projecting the outcome of a gambling game.

(ii) Keeping track of the cards played in a gambling game.

(iii) Analyzing the probability of the occurrence of an event relating to a gambling game.

(iv) Analyzing the strategy for playing or betting to be used in a gambling game.

(f) Cheats at a gambling game.

(g) Manufactures, sells, or distributes cards, chips, dice, a game, or a device that is intended to be used to violate this act.

(h) Alters or misrepresents the outcome of a gambling game on which wagers have been made after the outcome is determined but before it is revealed to the players.

(i) Places a bet after acquiring knowledge, not available to all players, of the outcome of the gambling game that is the subject of the bet or to aid a person in acquiring the knowledge for the purpose of placing a bet contingent on that outcome.

(j) Claims, collects, takes, or attempts to claim, collect, or take money or anything of value in or from the gambling games, with intent to defraud, without having made a wager contingent on winning a gambling game, or claims, collects, or takes an amount of money or thing of value of greater value than the amount won.

(k) Uses counterfeit chips or tokens in a gambling game.

(l) Possesses a key or device designed for the purpose of opening, entering, or affecting the operation of a gambling game, drop box, or an electronic or mechanical device connected with the gambling game or for removing coins, tokens, chips, or other contents of a gambling game. This subdivision does not apply to a gambling licensee or employee of a gambling licensee acting in furtherance of the employee's employment

So in better words, someone who is a handicapper, touts games or counts cards can get 10 years in jail. Yikes!!

Michigan law also disallows bucket shops.

As far as casual betting, the state laws also mention that all recreational or social gambling is illegal, but if the amount won or lost is under $50 then they will only take the winnings. If it is over $50 then those gambling recreationally are subject to up to a year in jail or a $1,000 fine.

However, to make the law as complicated and confusing as possible, Michigan adds two exceptions - The first exception is for gambling on bowling games where the amount bet is no more than $5 per frame (I get the impression it is a form of bingo) at certain bowling alleys in that state, and the second exception is for senior citizen's homes provided the people betting are over 60 years of age, the home has at least 15 people in it, the wagers are no more than a quarter per bet and the pot doesn't get to more than 5 bucks. As well, the betting can only take place between the hours of 9 am (this allows for teeth to be inserted, breakfast eaten and of course a good sponge bath!) and midnight ET (keeping in mind bedtime is usually 10 p.m. when all those sleeping aids kick in).

So if you're an elderly gambling bowler in Michigan you're in luck!!

There is no mention of internet wagering in their statutes.

Minnesota

One would expect the state of former governor Jesse Ventura to be fairly liberal in its gambling laws relating to casual bettors. Looking at the laws it appears that is indeed the case. While the laws are fairly harsh on those in the gambling business, it is very lenient to recreational gamblers. The law states that those who place a bet are guilty of a misdemeanour and subject to a fine, but it also clearly excludes social bets among individuals and bets with individuals that are not tied to organized crime. In the area of sports betting, while the bookie is guilty of a felony, the law excuses the bookie if the amount of bets total less than $2,500 in a 30 day period. For other betting, if someone in the betting business takes bets worth less than $2,500 they are guilty of a misdemeanour and subject to a fine, but if the amount is more than $2,500 they are guilty of a felony.

So for the recreational bettor, it is clear that in Minnesota as long as the bettor is not betting with the mob, they are not guilty of any crime. Since there is no mention whatsoever in the law about online wagering one can assume that betting online in Minnesota is not against the law either.

Mississippi

Mississippi's laws for the casual bettor are fairly straightforward. Anyone who places bets made outside of racetracks, riverboats or state sanctioned clubs are guilty of a misdemeanour offence and subject to a fine of no more than $500. There is no mention of internet wagering in their laws, but the state clearly does not allow social betting between individuals which would make one assume that betting on the internet was implied in the state's laws as well. Mississippi is most concerned with those who are illegally selling lottery tickets and pools and the state specifies penalties accordingly. Looking at past state convictions I couldn't find one instance of an individual convicted for placing "illegal" wagers, so it seems the recreational gambler is safe to wager online from Mississippi.

Missouri

Like many states Missouri lists simple gambling (i.e. recreational gambling) as a misdemeanour offence and subject to a fine and/or short prison sentence. As long as the person wagers small amounts, however, the state isn't concerned as can be implied from the following sentence within the state statutes:

"A person who gambles at a social game of chance on equal terms with the other participants therein does not otherwise render material assistance to the establishment."

There are no recent arrests that can be found for the recreational gambler. The same, however, is not true for the professional gambler, regardless of the method in which he/she makes his/her money. According to the state statutes, if a gambler makes at least 20% of their income from gambling activities then they are deemed to be professional gamblers and are subject to a felony conviction with jail time. There is no mention in the state statutes about internet wagering.

Montana

Montana, like Louisiana has somehow determined that it is their duty to protect the public from themselves and has stated a long preamble to the statutes to justify why they are taking gambling so seriously. The state contends that gambling is against public morals as follows: Public policy of state concerning gambling. (1) The legislature finds that for the purpose of ensuring the proper gambling environment in this state it is necessary and desirable to adopt a public policy regarding public gambling activities in Montana. The legislature therefore declares it is necessary to: (a) create and maintain a uniform regulatory climate that assures players, owners, tourists, citizens, and others that the gambling industry in this state is fair and is not influenced by corrupt persons, organizations, or practices; (b) protect legal public gambling activities from unscrupulous players and vendors and detrimental influences; (c) protect the public from unscrupulous proprietors and operators of gambling establishments, games, and devices; (d) protect the state and local governments from those who would conduct illegal gambling activities that deprive those governments of their tax revenues; (e) protect the health, safety, and welfare of all citizens of this state, including those who do not gamble, by regulating gambling activities; and (f) promote programs necessary to provide assistance to those who are adversely affected by legalized gambling, including compulsive gamblers and their families. The Montana constitution also states the following:

"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." That said, anyone who gambles in Montana is subject only to a misdemeanour which does not include jail time. Clearly, the DAs of Montana are far more concerned with those in the gambling business and 99% of the 3 page long statute deals with those in the gambling business. In fact the state even has specific exclusions for gamblers who wager among each other socially and for those who play at senior's homes. The state does mention internet wagering specifically within its laws, but again it seems to be geared towards those in the internet wagering business and more specifically to banks. It would appear the state has tried to set a policy which aligns itself with the UIGEA. The following is the wording of that internet clause: 18) (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.

(b) The term does not include the operation of a simulcast facility allowed by Title 23, chapter 4, or the state lottery provided for in Title 23, chapter 7. If all aspects of the gaming are conducted on Indian lands in conformity with federal statutes and with administrative regulations of the national Indian gaming commission, the term does not include class II gaming or class III gaming as defined by 25 U.S.C. 2703. Since gambling by the bettor himself is not specifically outlawed in the UIGEA, one can assume that the bettor is safe in Montana.

Nebraska

Nebraska's laws with respect to the recreational bettor are a bit confusing. The statute states that those who profit from betting as a proprietor are guilty of a felony, but it doesn't say much about the bettor himself. The law defines the player as someone who places a wager on any game or future event, but it doesn't actually specify what the penalty is for doing so. The laws clearly stipulate penalties for accepting wagers, but not for placing bets. That being the case, it can be assumed that recreational gambling is recognized by the state, but there is no intention by Nebraska police to prosecute anyone for engaging in betting as a recreational activity.

Nevada

One would expect Nevada to be pretty liberal with its gambling laws since Las Vegas is the largest gambling Mecca in the world. However, while the state is only too happy to have citizens and visitors wager within the state, it has very strict laws for Nevada residents that wager elsewhere. The laws of the state specifically make it illegal for a Nevada resident to place a wager outside of the state using the telephone, television, mail, computer or any other similar means. Furthermore, while residents can bet as much as they like within the confines of a casino or licensed establishment, they are guilty of a misdemeanour if they wager among themselves outside of those establishments. The state is also very tough with casinos which try to set up outside of Nevada and take wagers from Americans. Mega$ports, was forced to close its land based operation in Nevada after it set up an online gambling site situated offshore to cater to Americans. Nevada revoked the company's land based license and hit it with a hefty fine. Several Nevada casinos have discussed the idea of setting up internet betting sites to cater specifically to Nevada residents as is permitted within both state and federal law. Thus far though no casino has taken the initiative, likely because they are concerned with the fallout should a non-Nevada resident hack into their site and place wagers from another state, or even worse from another country.

Nevada congresswoman Shelley Berkley has spearheaded a study to look at the possibility of legalizing and regulating internet wagering for all U.S. states.

New Hampshire

The laws of New Hampshire make it a misdemeanour crime to place a bet recreationally that is not sanctioned by the state. Anyone who is in the business of taking bets is guilty of a felony. Thus far I have not been able to find a single incidence of a recreational gambler that was arrested for placing a bet in New Hampshire. There is no mention of internet betting in the state's statutes.

New Jersey

Like Nevada, New Jersey has a large economy based on betting, particularly in Atlantic City. Consequently, the laws of the state denote that all gambling is legal provided that it is sanctioned by the state. This includes casinos and racetracks, but it also specifies that charity gambling, social betting in clubs, fraternities, in fire stations and various other venues are legal provided the state allows it.

The most interesting note about New Jersey's statutes is that while it states gambling is illegal by residents where such betting is not sanctioned, it does not lay out any penalties for placing these "illegal bets". Instead the law simply says that all bets not sanctioned by the state are illegal and bettors have the right to recuperate losses. The person taking the bets is guilty of a misdemeanour also. This is an interesting tactic, rather than trying to issue a penalty against the recreational bettor that will never be enforced, the state has decided that the best way to deter illegal betting is to allow the bettors to get the money back for any losses they suffer. This in itself would deter anyone not sanctioned by the state from taking wagers. Whether anyone has tried to recuperate losses from bets placed underground is uncertain, but it is a novel approach.

It should be noted as well that at the 2000 GIGSE conference, an assistant attorney general of New Jersey stated that he was preparing to offer legalized internet wagering from New Jersey and would take bets worldwide. His idea was to place servers on the floors of the casinos where everyone could monitor the play to ensure its legitimacy. The idea was never brought up at any conferences afterwards, likely because of pressure from the U.S. Attorney General to drop the concept.

New Mexico

New Mexico's laws are pretty tame with regards to the recreational gambler. The statute indicates that placing a bet is a misdemeanour, but it doesn't specify any penalty. Furthermore, it creates several exemptions to the law including social betting among individuals. There is no mention of internet wagering whatsoever. Consequently, it is safe to assume the recreational bettor has no fears of prosecution in New Mexico.

New York

Home state for both of the leading candidates for the 2008 Presidency, New York is a key state for all laws. The state clearly disapproves of individuals who operate a gambling business in the state, as shown by the two major arrests in the state over the last year. The penalty for operating a gambling business or for bookmaking is quite harsh, necessitating a long prison sentence. The recreational gambler, however, is let more or less off the hook. The penalty for simple gambling is a fine, but the law excludes people who gamble with each other socially and there is no mention of gambling on the internet. That said, New York seems to have found a way of ensuring that citizens of its state have great difficulty in placing bets offshore. According to 5 separate readers of my columns that live in New York State, they have noted that telephone calls to most 1-800 numbers for sportsbooks from the state of New York are not connected and ISPs from New York seem to have achieved great success at blocking access to gambling sites. In fact one reader stated that he lived in Massachusetts and had no trouble placing wagers offshore, but since he moved to New York he has given up trying to connect to a site or phone in.

Currently 5 separate state Congressmen have joined forces with Barney Frank to try and have the UIGEA overturned. I have sent emails and faxes to Hillary Clinton and Rudy Giuliani to find out their stance on the issue of online gambling and hopefully will receive some response.

North Carolina

North Carolina may be best known for NASCAR, basketball and universities and hence one would expect to see stiff penalties for betting on sports. But such is not the case. In fact there is nothing in North Carolina's laws that mention the individual bettors. Gambling infractions all relate to those in the gambling business and the only reference to the recreational bettor is that all gambling contracts placed in the state of North Carolina are null and void and bettors can sue to get back losses. There is no mention of internet wagering in the state's laws.

North Dakota

North Dakota has set a limit as to what constitutes a legal recreational bet. Any bet under $25 is perfectly legal. Any bet between $25 and $500 is deemed "an infraction" and any bet over $500 is a misdemeanour. It is unclear what the penalty for an infraction is in the state, although logic would indicate that it would entail a warning or a small fine, but a misdemeanour is clearly labelled as punishable by a fine or short prison term. Otherwise, the entire gambling statute of North Dakota deals with those in the gambling business. Thus, it would appear that any bettor in North Dakota, whether betting with friends or on the internet should have no concerns with the law. The same, however, is not true with South Dakota as will be seen later.

Ohio

While the statute relating to gambling in Ohio is lengthy, it really doesn't say much regarding the casual bettor. It does mention that placing a bet is illegal, but it goes on and on with exceptions to the rule, including but not limited to, social betting, betting to fund religious organizations, betting to fund education, betting to fund fire houses, betting in volunteer, fraternal and veteran's groups, betting to support non profit organizations and betting in senior's homes. So essentially betting is illegal unless you offer something to society, in which case it's OK. The state does clearly disallow bookmaking, however, regardless of who profits. There is no mention of internet wagering in their statutes.

Oklahoma

Like most states, Oklahoma gives little mention in its statutes to the recreational gambler. The law seems to focus on those in the gambling business and the penalty for illegally operating a gambling business is a stiff fine or prison time. There is no consideration given in the law for social betting, but there is also no strict prohibition to gambling on the internet.

Oregon

Oregon's laws are also focused on those in the gambling business and the penalty is a felony. For the bettor the penalty is fine if convicted, but again I have found no cases of an individual charged with placing a bet. The state also prohibits gambling on sports, although it runs a sports lottery. Oregon does specifically mention internet wagering as an offence but the wording of the offence is a bit confusing. This is the specific part of the statute which disallows internet wagering:

"Internet" means an interactive computer service or system or an information service, system or access software provider that provides or enables computer access by multiple users to a computer server and includes, but is not limited to, an information service, system or access software provider that provides access to a network system commonly known as the Internet, or any comparable system or service and also includes, but is not limited to a World Wide Web page, newsgroup, message board, mailing list or chat area on any interactive computer service or system or other on-line service." Anyone who can decipher that deserves a medal, let alone the ability to gamble online.

The next article will be the conclusion of U.S. State laws and provide a summary of all the states' gambling laws.

Pennsylvania

It is actually unclear what Pennsylvania's laws say regarding recreational gambling. The statute deals solely with those in the business of gambling and makes it a misdemeanor offence to own gambling devices, run pools and be in the business of bookmaking. However there is nothing in the law that refers to placing a bet itself. The implication is likely that making a bet is a misdemeanor, but it is certainly not stated as such in the laws. Similarly there is nothing in the laws about social betting or internet wagering.

Rhode Island

As is the case with Pennsylvania, Rhode Island's statutes don't single out the recreational gambler. Instead gambling is implied in the following confusing section related to types of gambling that is prohibited.

Forms of gambling prohibited. Every person who shall, directly or indirectly, set up, put forth, carry on, promote, or draw, publicly or privately, any lottery, chance, game, or device of any nature or kind whatsoever, or by whatsoever name it may be called, for the purpose of exposing, setting for sale or disposing of any money, houses, lands, merchandise, or articles of value shall be deemed guilty of a felony and shall be imprisoned not exceeding two (2) years or be fine, or shall sell or expose to sale lottery policies, purporting to be governed by the drawing of any public or private lottery, or shall sign or endorse any book, document, or paper whatsoever, for the purpose of enabling others to sell, or expose to sale, lottery policies, except as authorized in this chapter and in title 41 and chapters 61 and 61.2 of title 42, shall be deemed guilty of a felony and shall be imprisoned not exceeding two (2) years or be fined not exceeding two thousand dollars ($2,000).

There is nothing anywhere else in the statutes that talk about placing a bet other than Bingo which is generally allowed everywhere. There is certainly nothing that discusses online gambling. Running a gambling business is a felony punishable by jail time, but if placing a bet recreationally or professionally? You're guess is as good as mine.

South Carolina

South Carolina is another state whose laws are uncertain in regards to the recreational bettor. As I read some of these laws as they are written it is clear they were drawn up decades ago and never really addressed since then. It is also evident that the legislators who were responsible for devising the laws often weren't sure what gambling entailed.

SECTION 16-19-40. Unlawful games and betting states the following: If any person shall play at any tavern, inn, store for the retailing of spirituous liquors or in any house used as a place of gaming, barn, kitchen, stable or other outhouse, street, highway, open wood, race field or open place at (a) any game with cards or dice, (b) any gaming table, commonly called A, B, C, or E, O, or any gaming table known or distinguished by any other letters or by any figures, (c) any roley-poley table, (d) rouge et noir, (e) any faro bank (f) any other table or bank of the same or the like kind under any denomination whatsoever or (g) any machine or device licensed pursuant to Section 12-21-2720 and used for gambling purposes, except the games of billiards, bowls, backgammon, chess, draughts, or whist when there is no betting on any such game of billiards, bowls, backgammon, chess, draughts, or whist or shall bet on the sides or hands of such as do game, upon being convicted thereof, before any magistrate, shall be imprisoned for a period of not over thirty days or fined not over one hundred dollars, and every person so keeping such tavern, inn, retail store, public place, or house used as a place for gaming or such other house shall, upon being convicted thereof, upon indictment, be imprisoned for a period not exceeding twelve months and forfeit a sum not exceeding two thousand dollars, for each and every offence.

Again nothing really relates to the casual gambler and nothing mentions online wagering, so it is safe to assume that recreational gambling in South Carolina is OK.

South Dakota

South Dakota has perhaps the toughest laws regarding internet wagering in the country. The laws relate to those in the gambling business, but the laws seem to set up the possibility of eventually extending to those who make a bet in the future. The law of the state prohibits recreational or social betting also punishable by a fine or short prison sentence. The section relating to online betting was written about 4 years ago. In Section 22 "Crimes" under subsection 25A Without doubt it will be examined in the future. The following is a link to the lengthy section of the South Dakota Statute:

http://legis.state.sd.us/statutes/DisplayStatute.aspx?Type=Statute&Statu...

A couple of highlights from that section indicate that operating an internet gambling business is a class 6 felony on first conviction and class 5 felony thereafter punishable by up to 10 years in prison. As well, the state considers each bet a separate felony.

Tennessee

Tennessee's gambling laws are short but to the point. Placing a bet in Tennessee is against the law and a misdemeanor offense. Anyone who is in the business of gaming is guilty of a felony and subject to prison time. There is no stipulation which allows any form of gambling other than state sanctioned lotteries and there is no mention of internet wagering.

Texas

Texas makes it illegal to place any form of bet anywhere other than places sanctioned by the state. If, however, the bets take place in a private setting, and the game involves skill then there is no crime. The law doesn't mention anything about online wagering so it is fair to make the assumption that online poker, games of skill and possibly sports betting that involves handicapping is legal in Texas. Regardless, the state does not prosecute the recreational gambler. Those in the business of betting are guilty of a misdemeanor.

Utah

Utah's laws with respect to gambling are very straight forward and in fact are written into the state's constitution.

"The Legislature shall not authorize any game of chance, lottery or gift enterprise under any pretense or for any purpose"

It certainly can't be any clearer than that, and is no doubt based on the Mormon dominated religion in the state which prohibits gambling. With that stipulation that gambling is illegal and can never be legal, I suppose there is really no need to discuss anything else as far as recreational betting goes in Utah. Those involved in the gambling business are guilty of a felony and face long jail time.

Vermont

Like most states, Vermont's anti-gambling laws focus on those in the gambling business. Those placing bets recreationally are subject to a fine but the law isn't enforced. The state also lists persons in the gambling business as being guilty of a misdemeanor and subject to jail time, but it provides numerous exceptions including but not limited to non profit gaming, and certain lotteries. There is nothing in the Vermont statutes that discusses online wagering.

Virginia

Virginia makes it a misdemeanor crime to place a bet in any common gaming house other than those permitted by the state, but it also excludes any betting that takes place in a private dwelling. The following is written in the statute:

"Nothing in this article shall be construed to make it illegal to participate in a game of chance conducted in a private residence, provided such private residence is not commonly used for such games of chance and there is no operator "

It can thus be argued that all poker games and any wagering that takes place privately in the privacy of one's home including internet wagering is legal since there is nothing else within the law that prohibits online wagering. The statute does prohibit certain types of wagering across territorial and state lines, however.

Those involved in the gambling business in Virginia, excluding areas sanctioned by the state are subject to a criminal felony conviction and jail time.

Washington

Washington mentions in its statute that gambling is illegal but lists numerous exemptions including social betting, sports pools, turkey shoots, golfing sweepstakes, fishing derbies, non profit wagering, amusement games and numerous other areas which it authorizes. At the same time the state gained notoriety across the USA in 2006 when it passed a law that made it illegal to wager on the internet and more so named it a felony offence subject to up to 5 years in prison. The law sent shivers down many Washington state citizens and poker sites but also raised the ire of civil libertarians who decried the law as tyrannical and unconstitutional. It's one thing to suggest that placing a bet is wrong and issue a fine, but it's another to classify it in the same category as rape and theft. Consequently, the law is on the books of the state, but there is a movement to have it overturned and numerous poker sites have indicated that there is a good chance that Washington's courts will reverse the law.

The law comes under the heading of "Gambling information, transmitting or receiving" and states the following:

Whoever knowingly transmits or receives gambling information by telephone, telegraph, radio, semaphore, the internet, a telecommunications transmission system, or similar means, or knowingly installs or maintains equipment for the transmission or receipt of gambling information shall be guilty of a class C felony subject to the penalty set forth in RCW 9A.20.021. However, this section shall not apply to such information transmitted or received or equipment installed or maintained relating to activities authorized by this chapter or to any act or acts in furtherance thereof when conducted in compliance with the provisions of this chapter and in accordance with the rules adopted under this chapter. [2006 c 290 § 2; 1991 c 261 § 9; 1987 c 4 § 44; 1973 1st ex.s. c 218 § 24.]

Notes: 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 law goes on in other sections to define the transmitting of gambling information to include making wagers.

West Virginia

West Virginia only discusses betting at a gambling house such as a tavern and really only addresses betting at a gambling table. At the same time it declares the only legal forms of wagering at a gambling table are backgammon, chess, bowls and draught whatever those last 2 are. All other wagers are not legal and can land someone in the county jail for up to 30 days. The wording of the law makes it sound like it was written ages ago so there is certainly no mention of internet wagering. Those involved in the gambling business are guilty of misdemeanors and can be jailed for up to 3 months in the county clink.

Wisconsin

Wisconsin makes it illegal to place a bet and a misdemeanor penalty. There is no exclusion for social betting nor for internet wagering. The legislation has interesting descriptions of "bets" and "bookmaking"

"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."

Clearly the definition of bet was drawn up to disallow any claims that the activity was legal because it involved skill.

"Bookmaking" means the receiving, recording or forwarding of a bet or offer to bet on any contest of skill, speed, strength or endurance of persons or animals."

Again the law was clearly drawn up to ensure that any bets involving living things is excluded.

The law also includes contests private or commercial.

Those involved in the business of gambling face a felony upon conviction.

Wyoming

The last state in the alphabet is Wyoming. Wyoming seems to have no issue with recreational gambling provided it is based on skill or what they call "Calcutta wagering", i.e. that it is conducted by the state and is a bonafide test of strength or skill. In fact betting on dog racing is even allowed in Wyoming.

The law clearly outlaws anyone other than the state from profiting from betting.

There is nothing in the laws Wyoming that discusses the internet.

 

SUMMARY To summarize all the articles, the first thing to note is that no federal laws prohibit recreational gambling. That includes land based wagering, social wagering and internet wagering. The UIGEA only discusses those in the business of processing or accepting funds for internet wagering and the other federal laws address those in the business of gambling. The determination of what is legal or not regarding the recreational bettor is a state issue. Therefore, I've provided the state laws for all 50 states as well as the District of Columbia and tried to focus on the recreational bettor, with a particular focus on internet gambling laws.

As can be seen, only one state, Utah, disallows all forms of wagering and they have written it into the constitution of the state. Unless the constitution is rewritten, legislators in Utah will never be able to legalize gambling of any form. Hawaii and Alaska also have no lotteries or other forms of state run wagering in their particular states, but recreational gambling is not prohibited, per se, in either of those two states.

Eight States (Indiana, Illinois, Louisiana, Montana, Nevada, Oregon, South Dakota and Washington) actually mention internet gambling within their laws. Wisconsin discusses wire communications and interstate wagering, although there is no specific mention of the internet itself. Of these only Washington listed wagering on the internet as a felony and punishable by prison time. That law is currently being appealed. Louisiana is the most draconian of the other states with internet gambling strictly specified, but even there gambling on the internet is a misdemeanor punishable with jail time. The other states simply incorporated the internet into their existing laws, with the exception of Montana and South Dakota whose internet laws are geared towards those in the business.

Michigan clearly has the most bizarre set of gambling laws while the District of Columbia and Rhode Island's laws are the most confusing.

The other state's laws relating to recreational wagering are either very lenient, such as Arkansas, or somewhat harsh, such as Florida. But in all cases, it is evident that arrests of recreational gamblers are few and far between. Most states are clearly interested in those involved in the gambling business.

The bottom line: if you live in Utah, Louisiana or Washington you are taking a chance wagering online. In all other states, the laws are there to see, but there should be no concern with being arrested by the police. Set up your accounts and have fun.

09-30-2007

Hartley Henderson

MajorWager.com

henderson@majorwager.com

Thanks to Hartley for taking the time and effort to prepare this material.