With technology quickly growing at this era, there has been so much improvements in our recreation activities. One of these is the emergence of online gambling. People will now have easier time in wagering on their favorite online casino games, as well as on major sporting events. But there has been a debatable question that is still lingering inside the minds of most people: Is online gambling legal?

All forms of online gambling and betting are widely criticized, and the United States totally banned and prohibited the operations of the said industry. However, gambling and betting online is sometimes legal, and sometimes it is not, depending on the circumstances. But looking at some state laws and legislative actions, online gambling is pretty much illegal.

Each activity that engages in online gambling and betting have their own risks to consider. Most likely, there are 8 stages of the potential risks of these gambling activities. These are as follows, arranged from the highest to the lowest risk:

Betting on a US-based Gambling Website and Over the Phone

Taking bets on a server located in the United States is mostly illegal. For this reason, all of online casino and gambling websites are hosted on other countries where the operations of this industry is legalized. Taking wagers on sporting events over the phone is also considered as clearly illegal.

Sports Betting and Payment Processing on an Offshore Server and then Visiting the US

If an American owns an online sportsbook or casino website and hosted it in other countries such as in some parts of Europe where online gambling is legal, the owner would be arrested when he returns to the US. This case is true to the American Jay Cohen, who located his sportsbook in Antigua and got convicted when he returned to the US in the year 2000. However, there are also some American offshore operators of gambling online websites that are left untouched even when they sometimes return to the US, such as the couple Ruth Parasol and J. Russell DeLeon of Party Gaming (hosted in Gibraltar), in partnership with Indian Anurag Dikshit. The same risks also applies to online gambling payment processing operators hosted elsewhere other than the US.

Taking Casino Gambling Bets from US Players on a Casino Website Outside the US and Online Gambling Payment Processing but not Visiting the US

Casino websites hosted on offshore servers that are taking poker and casino bets from US players is not against the law. But most owners of these websites are often apprehended and prosecuted, even though the prohibition of the 1961 Wire Act only applies to sporting events online and not on general gambling. However, facilitating the monetary transfer to online gambling sites through the US banking system is completely forbidden, and anyone caught in this practice would be convicted. But if he is outside the territory of the United States, he won’t be nabbed if he would not set foot on the US, unless the US government requests for his extradition from his country.

Helping People Make Bets on Gambling Websites

Webmasters of affiliate websites that are apparently taking money from potential players directly in order to help them place their bets online would take the risks of being indicted by the authorities with light sentence such as 8 days in jail with a fine of $1000 or more and spending 90 days of community service.

Online Gambling Advertisements: in Major Media

Some major media, such as Google, Yahoo, Microsoft, and The Sporting News, that accepts advertisements for Internet gambling had received letters from the US Dept. of Justice in the year 2003 and warned them that accepting online gambling ads could be illegal. And thus, they all discontinued accepting these advertisements. However, should they continue to do this, the only penalty would only be monetary fines, and there is no criminal charges.

Online Gambling Advertisements: in Smaller Media

All of the minor media had been spared so far in the cease and desist orders from the governments. Even the largest websites in the Internet that are solely devoted to online gambling have not yet received such notice.

Buying Advertising as a Casino, Poker Room, or Affiliate

In most cases, the only advertisers that are targeted by the government so far have been those offshore sportsbooks. Online casino and poker room operators, as well as casino affiliates and portals never received attention from the government yet, as far as we know.

Betting and Gambling Online as a Player

It is relatively safe to gamble on online casinos and online betting sites, and there has been no US citizen ever who faced federal charges of gambling online. However, there is only one online gambler, Jeffrey Trauman, who faced some charges from his state’s (North Dakota) law for making sports bet online. However, the state seemed only to set eyes on him because his winnings had been over $100,000. And to take note, this was only from sports betting and not from poker rooms or online casinos.

Resources: http://vegasclick.com/online/legal.html