Online Gambling and the Constitution
Online gambling involves placing bets on sporting events, virtual poker, and other forms of gambling. These activities are illegal under the Wire Act, the Illegal Gambling Business Act, and other federal statutes. In addition, state officials have expressed concerns that the Internet can be used to bring illegal gambling into their jurisdictions. These concerns have led to constitutional arguments about the validity of state law and the ability of Congress to authorize the use of force to prevent criminal activity.
The United States Attorney General is empowered to prohibit financial transactions by persons involved in illegal Internet bets. The law is based on the Commerce Clause of the Constitution. However, due process arguments have not proven particularly successful. In other words, the government cannot prosecute a person for illegal Internet gambling if they can only prove that the person’s activity was within a single state. This is despite the fact that federal law would reinforce state law in many cases.
While the Commerce Clause has a limited protection against speech that facilitates illegal activity, the First Amendment provides more robust protection. Because of this, many states have been reluctant to prosecute people who engage in gambling on the Internet, even in the absence of criminal conduct.
Some argue that the Constitution protects individuals from the consequences of their actions in their own home. This argument is often bolstered by the commercial nature of the gambling business. For example, an online poker site can handle chips and determine the winner of each hand in a matter of seconds. Other factors, such as the interstate or foreign elements of the activity, can frustrate state enforcement policies. Still other advocates contend that state gambling laws are unconstitutional because they restrict free speech.
While many of these arguments have been rejected, some have been upheld. For instance, the United States v. K23 Group Financial Services case charges Internet poker operators with UIGEA violations. In addition, the case charges the operators with money laundering, a felony. The government has also charged them with violations of 18 U.S.C. 1955, a federal statute that outlines the criminal penalties for money laundering.
Another argument that has been upheld is the Fifth and Fourteenth Amendments. While the Fifth and Fourteenth Amendments protect the right to privacy, they do not provide the same level of protection as other rights. Therefore, state officials have expressed concern that the Internet can be used to bring illegal online gambling into their jurisdictions. The government’s response to this argument has included a warning to PayPal that it could be subject to prosecution.
Finally, the First Amendment protects an individual’s right to privacy, but this right is not protected in the context of gambling in one’s home. For this reason, some argue that it is unlawful to bet on sports events in the home.
The Supreme Court has upheld the First Amendment as an important protection against the federal government’s ability to force citizens to engage in illegal activities. In addition, the Fifth and Fourteenth Amendments have been used to prevent the federal government from prosecuting citizens for engaging in crimes that only affect the individual.