Legal Implications of Wire Act on Online Gambling

Online gambling is patronized by many gamblers across the world. Since the birth of the Internet, many forms of businesses were born too and one of which is online gambling. The preference for online gambling activities is mainly due to its global nature where anyone around the globe can gain access to an online gambling site and easily participate with online betting. This is done in the convenience of their homes or anywhere they may comfortably feel like playing. All they need is merely a computer with internet connection.

Online gambling can be a mixture of challenge, excitement and amusement. It can be even a source of income by some because of the many opportunities of winning big from online betting. However in November 2002, a Court Ruling on Federal Wire Act was passed that vehemently prohibits the electronic transmission of online betting through the use of telecommunication forms of wagering and/or betting.

The legal restriction on online gambling is due to the facts that many states are observing laws against gambling activities and there is an existing federal statute that forbids the utilization of telecommunications in betting and wagering. Because the Internet usage is basically done through the use of telephone lines, the Wire Act against online gambling imposes strong prohibition against online betting.

Owning any online gaming establishment not duly licensed in your State is illegal and sanctions for violation also differ from State to State. This gambling implication brought great impact of putting many online operators out of business in the US. Many concerns arose since the birth of online gambling with one heavy case of money laundering activities that are using online wagering as a front with this illegal operation. Because of the highly technical encryptions and coding used in financial transactions with online betting, this form of confidentiality and the anonymous nature of the Internet can harbor unscrupulous activities that would be hard to trace.

The two largest search engines, Yahoo and Google, removed online gambling advertisement from their sites in 2004. An inclusion from the Wire Act is the legal scope against online gambling that also applies to all forms of online betting including advertisements. Due to this implication, many fund transfer sites have discontinued their services and participation in the electronic fund transfers involved with online betting.

Since the gambling law from State to State differs, it would be wise to consult a lawyer about the applicable law that applies to the State where you live for personal awareness. Many also argued that online gambling must be legalized in order to provide control on this growing industry.