The Federal Government’s Role in Regulating Online Gambling


Gambling is a form of wagering something of value on a chance, or uncertain event. It includes a variety of activities, such as lotteries, gambling on sports, and pool-selling. Depending on the state, the act is either legal or prohibited. There are three basic components of gambling: risk, consideration, and a prize.

The United States has a comprehensive set of laws to regulate gambling. These laws restrict the type of gambling, as well as the methods of gambling. In addition, gambling activity on Indian reservations is regulated under federal law. Generally, however, federal preemption has hindered states’ efforts to regulate gambling on tribal land within their borders. This problem has been compounded by the fact that interstate and foreign elements have been able to frustrate state enforcement policies.

For example, the federal government has made it illegal for lottery tickets to be transported from one state to another. In addition, Congress has outlawed sports betting with some exceptions. However, there are many different types of gambling, and each state determines what type of gambling can be offered in its jurisdiction.

In some cases, the Department of Justice has attempted to enforce the federal laws on gambling. For instance, in 2011, the U.S. marshals seized $3.2 million from a Discovery Communications subsidiary and threatened PayPal with prosecution for violations of the Unlawful Internet Gambling Enforcement Act. Similarly, Sporting News agreed to pay a $3 million public-service campaign after being fined for violating federal gambling laws.

While it is unclear whether the federal government has the authority to ban Internet gambling, Congress has enacted various laws to control it. They include the Unlawful Internet Gambling Enforcement Act, which criminalizes the unauthorized provision of online gambling services to individuals in the United States. In addition, the Federal Communications Commission has jurisdiction over common carriers and facilities. Consequently, if the FCC were to stop providing facilities and discontinue furnishing them, a business that offers gambling services could be deprived of its operating license.

However, the Department of Justice and Congress have struggled to define the boundaries of the law in this area. In some cases, the Commerce Clause doctrine has been used to assert that the federal government has the power to regulate the activity. But this theory has been challenged on constitutional grounds.

Another issue is whether the Commerce Clause requires the government to regulate gambling activities that take place outside the states. The answer depends on whether there is a conflict between the dormant Commerce Clause doctrine and the state’s authority to regulate gambling. If the two theories do not go hand in hand, the state may not be able to enforce its gambling laws.

On the other hand, the commercial nature of the gambling industry may be able to satisfy the Commerce Clause’s doubts. Even though the Department of Justice has asserted that all Internet gambling in the United States is illegal, a variety of arguments have been brought up as to the merits of the legality of online gambling.