The US is currently struggling with legal issues in regards to online gambling and playing poker online for real money. While there are still US poker sites available to play, there is not as wide a variety as there used to be. Right now, the poker sites that are available in the US are based in countries outside of the US and basically have methods in which they can accept funds from online poker players in the US. This is technically somewhat of a gray area, but the UIGEA (Unlawful Int. Gambling Enf. Act of two-thousand and six) does not go after the players, it is directed specifically at prohibiting gambling operations from accepting payments that are connected to one person making a wager or a bet that utilizes the web and that could be considered illegal according to state or federal laws. 1
Is this prohibition of US online gambling and US poker sites archaic and entirely hypocritical? Absolutely and that is why for the past five years, organizations, lobbyists and gambling companies and congress people have worked to get the laws changed. Certainly one might have thought that US Poker Sites were legal up until April of 2011 simply because of the rampant advertising for Full Tilt. PokerStars, Full Tilt and others were making their presence known constantly with television programs on NBC, ESPN and other cable networks. It looked like US Poker was here for good until criminal activities that were too massive to ignore were detected by US law enforcement officials, especially those surrounding Full Tilt.
It is now November 2011 and US Poker Sites may be legalized before February of 2012, with companies like bwin.Party making deals with MGM Resorts and Boyd Gaming. Other online poker sites that used to have a strong presence in the US but left a number of years ago may also still have a good foothold on the market. Once the prohibition on poker online is lifted and US gambling companies are put under a licensing system like those found in the UK and Italy, the industry is expected to generate billions of dollars for the country. In the meantime, poker players want to know if it is legal for them to play poker online.
The area is gray simply because the laws are directed towards large companies. Individual players are subject to following the laws of their States and federal tax laws. Most offshore online poker companies are conducting their businesses as legally as possible. There are unfortunately some that are shady and this is yet another reason why so many want the laws for Poker Sites in the USA to change rapidly. There are some casinos and poker rooms that are based in Costa Rica and other parts of the world that do not conduct their gambling operations fairly. This has become an issue because thousands of Americans are being bilked out of hundreds of thousands of dollars each year because these sites are only monitored by private organizations and review sites like this one. Poker Sites in the USA would be placed under strict regulations that are developed to protect American citizens from unfair play.
One of the key points of the UIGEA is how money is handled. Because of tax issues in the United States, online gambling with overseas companies at the helm creates an area that might be considered money laundering. The UIGEA jointly addresses these issues with other supporting documents from federal government agencies that monitor such illegal activity. The document covers card systems such as credit and debit cards as well as Automated Clearing Houses (ACH), Wire Transfers, Check Collection and Money Transmitting Businesses. Online poker sites that are operated outside of the United States have essentially addressed issues with transacting money when dealing with their gambling operations. Many do so in a legal fashion, while other unscrupulous companies do not.
This is one of many unfortunate side effects of the UIGEA in that major online gambling companies that once held an interest in the US have been driven out of the country and smaller, less trustworthy companies have moved in. Large online poker sites like those that are found in the UK are often publicly traded companies which strengthens their credibility. Smaller companies that operate outside of the country and outside of the law work against the consumer and opens up so many other issues that makes the law completely impossible and unnecessary. Simply put, the UIGEA harms America and regulation of online poker and the introduction of legitimate and publicly traded US Poker Sites needs to happen immediately to remedy the damage that has been done and protect Americans going forward.
The language of the UIGEA as interpreted by 888, PartyPoker and other publicly held companies decided the best move was to exit the US Market. Others such as Full Tilt, PokerStars and Absolute Poker stayed in the game. Why did it take the US government nearly five years to take action against the big names? Who knows, but speculation suggests that the reason these companies were finally just eliminated is because the US will soon legalize poker online and regulating large gambling companies within the borders of the United States will be much easier with a clean slate. Plus, any money seized in conjunction will also make setting up legislation and regulation of new American based online gambling companies much easier.
There are several poker online sites that still service US customers. Below is a list of some online poker sites that continue to provide services to the US.
Juicy Stakes (Cake Network)
You will find a number of supposed online resources about online poker in the US being 100% legal, but as of November 4, 2011, the US government has made it very clear that they believe that online poker in the US and any online gambling is 100% not legal. Federal prosecutors filed a massive fifty-one page document that details their case against online poker companies that are/were operating in the US. The document even invokes the involvement of the Mafia in these dealings. The fifty-one pages completely outweigh the thirty-three page memorandum submitted by Campos and Elie who are accused of violating the UIGEA in a conspiracy to launder money.
The Department of Justice is reinforcing their long spoken belief that online poker is illegal. Until it is legalized in the US, no online poker site operating in the US is safe from this long arm of the law. If you are currently playing at poker sites that accept US players, you do so at your own risk. It is possible that your funds could be seized or the assets of those companies could be frozen indefinitely.
Other sites may argue that the question of legality in online poker falls to the State and local laws however, this information is outdated. Is the US Federal government on one last final crusade to eliminate online gambling in the US? It would appear so and they have a few more months to knock out any stragglers before new laws begin to go into effect.
Confusing isn’t it. The vagueness of the UIGEA and the recent actions of the federal government against the remaining big names in online poker has created some intense debate about the fairness of their actions. Essentially, the events of April 2011 have only reinforced the assertion that poker online should be legal so that the government can regulate and license the activity to protect its citizens. Full Tilt while operating in the United States financially harmed several US citizens and even though the government was able to stop it, they could have prevented it with regulations and monitoring of finances of those companies in the open while also collecting taxes to pay down the massive debt that has accumulated.
31 USC 5361-5366
12 CFR Part 233 (Federal Reserve Board)
31 CFR Part 132 (Department of Treasury)
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