Justice Department opinion allows states to offer online gambling


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The Justice Department has opened a window for states to offer their residents online gambling, saying such activity would not violate existing federal law.

The legal opinion could be a boon for states looking for ways to expand their lotteries to help close large budget deficits.


Assistant U.S. Atty. Gen. Virginia A. Seitz said that proposals from state lotteries in Illinois and New York to sell tickets to adult residents online would not violate the 1961 federal Wire Act because they do not involve sports betting.

The 13-page legal opinion was issued Sept. 20 and quietly released by the Justice Department last week.

The Poker Players Alliance, which has been working for years to get Congress to make online poker legal, said the Justice Department opinion was ‘a much needed clarification of an antiquated and often confusing law.’

‘This will provide policy makers at both the state and federal level with the legal confidence to move forward with licensing and regulation of online poker and other non-sporting activity within their respective jurisdictions,’ said the group’s executive director, John Pappas. He called on Congress to enact federal regulation of online poker to avoid a patchwork of different state laws.

State-run online lotteries also would not violate a controversial 2006 law, the Unlawful Internet Gambling Enforcement Act, which was meant to crack down on online poker sites. That law prohibits ‘unlawful Internet gambling,’ which is defined as placing, receiving or transmitting a bet via the Internet in a jurisdiction where federal or state laws make such bets illegal.

The 2006 statute allows bets ‘initiated and received or otherwise made exclusively’ within a state that allows gambling and specifically says that the ‘intermediate routing of electronic data’ does not factor in determining the location of the bet.



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-- Jim Puzzanghera in Washington