1961 Federal Wire Act Law
The Federal Wire Act is the oldest law affecting sports betting in the US. This law was passed under President John F. Kennedy in 1961 and has faced its share of challenges and speculation. The law restricts any bets or wagers being placed through wire transmission facilities.
The controversy around this law surfaced in later years with the emergence of modern technologies. This law’s meaning and ruling garnered so much debate that the US Department of Justice had to step in and issue a Formal Opinion. ‘
This page is dedicated to discussing the ins and outs of the Federal Wire Act, including its controversy, the DOJ’s Formal Opinion and how the law affects modern USA sports betting.
A Law Changed For The Changing Times
Back in 1961, “wire transmission facilities” literally meant over the wire. In today’s society we have computers, smartphones, tablets, etc. Federal politicians began to argue the reach of the Federal Wire Act several years back. Some believed that the law should include all forms of “wire transmissions”, specifically computers, while others stand firm behind the law’s original language.
For those supporting the former line of thinking, this meant that the Federal Wire Act should effectively ban all forms of online gambling, as it includes bets and wagers being placed. After heated discussions, the US Department of Justice weighed in on the matter and ruled that the law should only apply to sports betting. This Formal Opinion means that the US-based online sportsbooks are prohibited from accepting any bets or wagers, effectively banning online sportsbooks within the country.
The ruling also affected other forms of online gambling, as the DOJ’s Formal Opinion gave states the right to decide if they wanted to implement state-regulated online casinos or poker sites, though only a few states have followed through with it.
The Federal Wire Act’s Effect On Online Gambling
The key takeaway from the Federal Wire Act is that it restricts US-based online sports betting. No state in the US has the authority to allow a state-licensed online sportsbook to accept wagers or operate in any way. However, the law does not pertain to licensed offshore sportsbooks.
Americans interested in placing sports bets online can turn to legally licensed and regulated offshore sportsbooks. These offshore sportsbooks are outside the jurisdiction of both the Federal Wire Act and the Professional and Amateur Sports Protection Act.
If the law were repealed, US-based online sports betting could have a chance, but the odds of that happening are not really in our favor at this point in time.
Federal Wire Act Supporters Not Backing Down
The DOJ’s Formal Opinion freed up states to allow legal online gambling as long as it doesn’t involve sports betting. Back in 2014, South Carolina Senator Linsey Graham tried circulating a bill known as the Restoration of America’s Wire Ac, or RAWA.
This bill would overturn the DOJ’s Formal Opinion and reinstate the law’s application (or at least Graham’s perception of the law) to include all forms of online gambling. While RAWA failed to pass, the fact that it was even an effort showcases the obstacles befalling the online gambling industry.
The DOJ’s ruling, albeit not helpful to sports betting, highlighted the changing tide with online gambling in the United States. Online sports betting could one day be legal in the US, giving states the power to host online sportsbooks that are regulated. If RAWA were to pass, it would be a huge step backwards in the fight for online gambling.
Does The Federal Wire Act Prevent Me From Placing Sports Bets Online?
The law only presents restrictions relevant to US-based online sportsbooks. American bettors can still place bets legally and safely through licensed offshore gambling providers.. You can bet on teams from all over the US and even around the world. Americans are able to bet with these US sports gambling sites because they are legally sanctioned and regulated by a government outside of the United States.
Furthermore, these governments have their own gambling and sports betting laws and are outside the jurisdiction of US federal laws including the Federal Wire Act and PASPA. These offshore sportsbook brands present the only viable USA facing full scale sports betting opportunities outside of Nevada.
Will There Ever Be Legalized Online or Offline Sports Betting In The US?
In order for there to be legalized sports betting in the US, PASPA and/or the Federal Wire Act would have to be repealed. If both gambling laws were abolished, states could have access to both brick-and-mortar and online sportsbooks.
Sports betting is a lucrative industry all around the world, so the United States may soon decide to change something with their laws, but unless you live in Nevada or take a trip to Las Vegas, any form of sports betting through a US-based physical or online sportsbook is considered illegal.