Is online gambling legal in the U.S.?
I'm not a lawyer. Do not rely on this article as legal advice. I also can't guarantee to have heard of every relevant case.
Last update: January 2022
article was cited in the book Legal
Principles for Combatting Cyberlaundering.
- There is no federal law against online gambling. (more...)
- Over a dozen states have legalized some form of online
gambling, but you have to play in one of their approved
casinos or sportsbooks. (more...)
- Most states outlaw unregulated gambling in general, which applies equally to online and offline gambling. However...
- Even in states where online gambling is illegal, prosecution is rare and penalties are usually slight. In most cases it's only a misdemeanor, and in some cases it's a minor infraction, like a traffic ticket. The penalty in Arkansas is a whopping $25. I'm so confident that almost nobody gets jailed for gambling online that I openly offer to pay $100 for each report of a U.S. citizen serving even one night in jail after being sentenced for online gambling (as a player) under any U.S. state law. (details)
- Bovada takes players from most states, even from states where Internet gambling is technically illegal. advertisement
a d v e r t i s e m e n t
Summary of state laws about online gambling
* In IA & MT, it's a felony to bet at an unlicensed site.
† Sports betting set to launch in Ohio in Jan. 202..
Most states don't actually outlaw online gambling specifically, they outlaw gambling in general, which applies equally to online and offline gambling. A few states do outlaw online gambling specifically (like LA, UT, and WA). However, online gambling cases are rarely if ever prosecuted in most states, and penalties are usually slight.
States where online gambling is explicitly legal
|States with legal online gambling|
|New Jersey||Nov. 2013
|New York||Jan. 2022|
Even in states with legal online gambling, play at unlicensed operators might be illegal, according to state law. For example, Bovada takes players from Connecticut, but Bovada isn't licensed there, and it's illegal in Connecticut to play at an unlicensed online casino. (However, it's only a misdemeanor, and I doubt it's ever enforced.)
The District of Columbia became the first jurisdiction to
legalize some form of online gambling in the U.S., in April
2011. However, the measure was repealed in February 2012
before it ever became active. (NY
Times) Delaware was next to legalize (June
2012), followed by Nevada and New Jersey (Feb.
2013). Nevada was first to launch (April
2013), followed by New Jersey (11/25/13)
and Delaware (11/26/13).
- District of Columbia. Except it's illegal to play Three Card Monte. (22-1706)
- Kentucky. In fact, the section on gambling says, "The status of a 'player' shall be a defense to any prosecution under this chapter". 528.010 (8)
- New York. Section 225.05 of the penal code says a person is guilty if "he...advances or profits" from gambling, but Section 225.00 clearly states that "advancing" and "profiting" are terms that apply to operators, not players. (Laws of NY)
- Ohio. But they legalized sports betting, to start in Jan. 202. Also, it's against the law to be a pro player: "No person shall...engage in betting or in playing any scheme or game of chance as a substantial source of income or livelihood." (2915.02(A)(4))
- Rhode Island. "Forms of gambling prohibited" speaks to operators, not players. (11-19-1)
- South Carolina. First, the statute outlaws gambling in physical places ("barn, kitchen, stable, street, highway, open wood..."), which wouldn't seem to apply to the Internet. Second, if it did apply to the Internet, it would seem to apply only to table games (mentioned specifically in the statute), but not slot machines, since the only "devices" mentioned are ones which are "licensed", and online slot machines aren't licensed. (16-19-40, 12-21-2720)
Every state's code listed in this section was current through at least 2019 when I checked it in 2020.
State violations of gambling are usually misdemeanors
Even when states don't allow players to gamble, the maximum penalties are usually light. The only states where simple gambling is a possible felony on first offense are Iowa, Montana, and Washington. In most states simple gambling is just a misdemeanor, and in Alaska and Arkansas it's a simple petty offense, like a traffic ticket.
The table of penalties depending on the state is pretty long, so I moved it to a separate page: State-by-state penalties for online gambling.
Online players convicted of breaking State laws
I know of only two cases in which an online player ran afoul of state laws. They were both charged under their state's general anti-gambling laws (not any specific anti-online-gambling law), several years ago, and were not sentenced to jail.
- North Dakota. Jeffrey Trauman paid a $500 fine on
what was probably over $100,000 in online sports bet winnings, in
& the Law)
- Oklahoma. Online sports bettor Roland Benavides was charged in 2011 and in 2012 received a deferred sentence (which means that if he didn't violate the terms of his probation, he would face no jail time). (News OK)
If you do a Google search for "arrested for online gambling", you won't find examples of players being arrested, only operators. (Well, maybe you'll find examples well deep into the results, but I couldn't find any on the first few pages.)
I'm so confident that almost nobody gets jailed for gambling online that I openly offer to pay $100 for each report of a U.S. citizen serving even one night in jail after being sentenced for online gambling (as a player) under any U.S. state law. (details)
There is no U.S. federal law against gambling online
There is no U.S. federal law against gambling online, as a
player. At the federal level, gambling online is
perfectly legal, because of the lack of a law against it.
U.S. Attorney Catherine Hanaway admitted in a House hearing that just placing wagers online doesn't violate federal law. No American has ever been arrested, indicted, or prosecuted by the feds for gambling online, because you can't break a non-existent law. If online gambling were illegal under federal law I wouldn't be running his website for twenty years, as an American citizen, living in the U.S., using my real name. I've occasionally gambled online, too, at Bovada, and I admit that publicly, like I'm doing right now.
This might be confusing because other outlets erroneously reported that Congress banned online gambling in 2006. Those reports are simply wrong. The 2006 law makes it illegal for banks to move gambling money when the bets are already illegal (like from a state law), but doesn't make it illegal for players to make bets. In fact, the law says quite clearly, "No provision of this subchapter shall be construed as altering, limiting, or extending any Federal or State law or Tribal-State compact prohibiting, permitting, or regulating gambling within the United States." You can see for yourself by checking out the full text of the law.
While you don't break any federal laws from placing bets online, it's not legal to run a gambling operation (i.e., to take bets), except in those few states where it's explicitly legal and the operator is licensed.
And yes, the FBI posted a scary warning online in 2007 in
which they claimed that placing bets online is against the law.
In short, they lied. (more on that)
Taking bets online is usually illegal
It's illegal in all states to take bets (as the casino/operator), except for licensed operators in those few states where gambling is regulated. So, for example, don't try to run a raffle on Facebook.
At the federal level, taking sports bets online is plainly illegal, thanks to the federal Wire Act, unless a state has specifically legalized it.
The feds keep changing their mind about whether the Wire Act applies to taking casino/poker bets as well as sports bets:
- Before 2001, the DoJ said the wire act applied to casino and poker bets too.
- Then in 2002, a federal court ruled that the Wire Act applied only to sports betting, not casino. (source)
- That didn't stop the DoJ from prosecuting poker sites in 2008 and 2011. (more...)
- Then in 2011, after the prosecutions, the DoJ reversed itself and said it applied only to sports. (Forbes)
- Then in 2019 they reversed themselves again and said it applies to casino and poker. (source)
- Later in 2019, a federal court set aside the DoJ's position, with the court saying that the Wire Act applied only to sports bets. (source)
- However, sources say the DoJ will most likely appeal the court's decision.
- In the meantime, the DoJ said it's suspending enforcement against non-sports operators. (source)
States can now offer sports betting
In May 2018, the Supreme Court overturned a law that prohibited sports betting in all states but Nevada. This allows individual states to legalize sports betting (including online betting) should they choose to do so. (Forbes)
Beware of advice on other websites
Lots of other websites say it's legal to gamble online in places where it actually isn't, probably because those sites get advertising money from online casinos. (I get advertising money too, but that's not gonna make me lie about the law.) For example "Let's Gamble USA" (LGU) says, for Illinois, "[T]he law doesn’t list any punishments for participating in online games as a player" and so "most experts agree that playing on offshore sites is perfectly legal for Illinois residents." First, LGU doesn't bother to quote or link to even one of these supposed "many" experts. Second, online gambling is actually plainly illegal under Illinois 720 5/28-1, which states "A person commits gambling when he or she knowingly plays a game of chance or skill for money or other thing of value...or knowingly makes a wager upon the result of any game [or] contest....Gambling is a Class A misdemeanor." There is no exception listed for gambling online. Third, 730 5/5-4.5-55 plainly lists the possible penalty as $2500 and/or one year in jail.
For Arizona, LGU says, "[T]he legal status of online play in Arizona is somewhat ambiguous, as many lawyers argue whether the general laws can be applied to playing on unlicensed iGaming sites or not...[M]ost industry experts agree that Arizona is perfectly safe when it comes to online play." Here again, they don't bother to quote or link to a single one of these supposed "lawyers" or "experts". But anyway, let's go straight to the source, the text of the actual laws in Arizona:
"[A] person commits benefiting from gambling if he knowingly obtains any benefit from gambling." (Arizona 13-3304)
"‘Gambling’ or ‘gamble’ means one act of risking or giving something of value for the opportunity to obtain a benefit from a game or contest of chance or skill or a future contingent event " (Arizona 13-3301.4)
There is nothing in the text of the law that suggests that it applies only to brick-and-mortar gambling and not Internet gambling.
For Montana, LGU says "being caught would result in a serious fine", ignoring the fact that the sentence could include up to ten years in jail if the amount bet or won is more than $750. That kind of omission is either wildly irresponsible or grossly incompetent.
I suspect that LGU commits similar omissions or inaccuracies for the other states, but I stopped checking after I found serious problems with the first three states I checked. Let the player beware.
$100 reward for reports of a player spending time in jail for online gambling
I think the chances of going to jail for online gambling in the U.S. are so small that I offer a $100 reward for each report of a player actually getting jail. Here are the details:
- The defendant must be the player (not an operator), and must be sentenced for online gambling (not offline), in one of the U.S. states.
- The player must actually spend at least one night in jail as a result of the sentence.
- I accept reports starting one week after the first night in jail is spent. If you notify me of an arrest or sentencing before that happens, the reward is only $25.
- In the event of a sting in which multiple people are arrested at the same time or under the same operation, the limit is one reward.
- Only the first report for a specific case is eligible for the reward. (e.g., If five people notify me of the same case, only the first person gets the reward.)
- Does not apply to any cases I already list on this site.
- I don't promise to offer this reward in this format forever.
If you know of any qualifying cases, then contact
me and claim your reward.
- State by state penalties for gambling
- Is it legal to run a casino affiliate website in the U.S.?
- Is it legal to run an online gambling website, or advertise for it?
- See our timeline of legal events re:
- Attorney I. Nelson Rose's columns on gambling & the law at Casino City