Online poker and the Law

Online poker and the Law Playing poker online? It's illegal, according to the Department of Justice. By Kim Komando You're playing with real money. You've paid for betting chips via an escrow service. And, if you're lucky enough to win, your account will be credited with money. What's wrong with this picture? It's all illegal, according to the Department of Justice. There are thousands of gambling Web sites. And they operate offshore, conveniently beyond the grasp of U.S. regulation. Online casinos have been around for about a decade. But the recent rise in the popularity of poker has spurred their growth. According to Keith Furlong, deputy director of Interactive Gaming Council, an industry trade organization located in Canada, online casinos will attract about $10 billion this year. Americans make up 60-65 percent of their business, he added. Some states have passed laws prohibiting online gambling. However, no federal laws specifically address it. Rather, the federal government relies primarily on the Wire Wager Act to prosecute online casino operators. Under the act, business owners who accept bets via a "wire communication facility" face fines and imprisonment. The act was intended to curb the use of the telephone to accept bets. Opponents are quick to note the act was written in 1961, before the Internet. They question whether the law applies to online gambling. And they insist that online gambling is a gray area at best. However, the Department of Justice is adamant that online gambling is illegal. And in 2000, it successfully prosecuted Jay Cohen, an American and part-owner of the World Sports Exchange in Antigua. Since 2002, the DOJ has pressured media companies to pull ads for online gambling. Clear Channel, the nation's largest radio company, stopped airing ads for online casinos that year. Other mainstream media companies have followed suit. Banks have also come under pressure from the DOJ. Many decline credit card transactions from online casinos. Among them is Bank One, a national bank. "[It's] because of the high likelihood of fraud," said Mary Jane Rogers, a Bank One spokesperson. "Bank One may restrict transactions that appear to be Internet gambling." She added that the bank cannot always tell that a charge is from a casino. Other payment options are also dwindling. PayPal stopped processing payments for gambling in 2002. That left only a few lesser-known escrow agents that work with the casinos. Recently, the World Trade Organization (WTO) ruled the United States can regulate online gambling to protect public morals. However, the ruling states that U.S. laws must be clarified. The nation of Antigua and Barbuda initially filed the suit, claiming U.S. restrictions amounted to unfair trade practices. The economy of Antigua and Barbuda, which are Caribbean islands, relies heavily on Internet gambling. Antigua and Barbuda points out the U.S. allows gambling within its borders. And, in the case of state lotteries, the gambling is sometimes government-sponsored. Interestingly, Antigua and Barbuda views the WTO ruling as a victory. It sees two options for the United States. One, the United States must ban all gambling. The second option would be to grant offshore companies access to the market. The Department of Justice did not return calls for comment. Users are still visiting these sites in record numbers. And many of them reside in the United States. Currently, the federal government does not prosecute the gambling sites' customers. However, some state governments do. The WTO hopes to reach a final resolution of the dispute between the United States and Antigua and Barbuda later this year. In the meantime, Americans may well be breaking U.S. laws when playing poker online.