Gambling is a game where players attempt to win something of value from a random event. The games are commonly called lotteries or pools, and they involve a range of strategies. In the United States, gambling is regulated by both state law and federal legislation.
State officials have expressed concerns that Internet-based gambling might bring illegal gambling into their jurisdictions. But states have not been particularly active in enforcing online gambling laws. This is in part because of the dormant Commerce Clause doctrine, which holds that federal power lies with the federal government.
For example, federal law prohibits the transportation of lottery tickets between states. The Commerce Clause also preempts state law when it relates to Indian reservations. However, the dormant Commerce Clause is not yet clear on whether Internet-based gambling falls within its jurisdiction.
Congress has seized on its power under the Commerce Clause to regulate Native American territories. It has also used the power to outlaw sports betting. These actions have thwarted states’ efforts to regulate gambling inside their own borders.
The federal government has also seized on its powers under the Commerce Clause to regulate Internet-based gambling. According to the Department of Justice, all online gambling in the United States is unlawful.
Internet-based gambling is considered a crime under the Unlawful Internet Gambling Enforcement Act (UIGEA). The owner of an illegal gambling business may be fined. Additionally, an owner of an illegal gambling business can be jailed.