Broadly speaking, gambling is not illegal in the US. There are no longer any federal laws banning gambling, as long as it does not take place across state lines or involve an online betting. It’s also illegal for businesses to run gambling websites and to solicit online bets. Even companies handling transactions for cyberspace bettors can face federal charges. Our strategy for tackling illegal online gambling—as a key enforcement agency—is to start with the companies providing the services in the first place.
In decades past, gambling used to be a crime almost everywhere other than Las Vegas, Nevada and Atlantic City, New Jersey. Today, more and more states have legalized various types of gambling, ranging from Indian casinos to poker rooms and horse racing tracks. While some states have legalized certain types of gambling, other types of gambling are still illegal. All states have laws that prohibit at least some type of gambling.
Gambling is sometimes referred to as “gaming.” Depending on the language of state laws, gambling and gaming can mean different things or the two terms can be used synonymously. “Gaming” typically refers to playing games for wagers, such as craps, card games, slot machines, and roulette. “Gambling” may refer to these same types of games, but it also includes other types of activity such as sports wagers.
Gambling is defined in numerous ways, but requires betting or wagering on an outcome that is at least partially based on chance, and done so in order to win something. Illegal gambling is any type of gambling that is specifically prohibited by state law.
Gambling Involves a Bet
While most instances of gambling occur when someone bets money, courts have ruled that gambling can occur whenever a bet is made using anything of value. The item of value is sometimes known as “consideration,” and can encompass anything that has any worth. The amount of the bet doesn't matter, and as long as the property that's at stake in the game is worth some value, the game is gambling.
'Games of Chance'
State gambling laws outlaw games, bets, or wagers that are at least partially dependent on some element of chance. If a game or competition that gives prizes to winners is based on skill, such as a car race or a shooting competition, it is not considered gambling. (However, other laws or restrictions may apply in order to make such competitions legal.)
What differentiates a game of skill from a game of chance is usually determined by which of the two elements has the greatest impact on the outcome. If chance is the biggest factor, the game is one of chance, and making bets or wagers on such games is gambling. Courts have ruled that in games that involve both skill and chance, and where a small group of skilled experts routinely win, this does not necessarily make the game one of skill. In determining what defines a game of skill or chance, courts often judge the game on the average player. If the average player's chances are dominated by chance, the law considers it a game of chance.
A Chance of Winning
If you don't have any chance of winning something of value, you're not gambling. Gambling requires that there is a chance you might win something for your bet, whether it's money, property, or even more chances to play. Further, courts have ruled that you personally don't need to have placed any wager to be convicted of gambling. As long as a group of people have a chance to win something and at least some of them have made a wager, you can be convicted of gambling if you are part of the group and stand a chance at winning.
Prohibition Against Making a Profit
Those who win at gambling have obviously made some money. But aside from the players, what about the businesses who run or operate the gambling game or establishment?
Some state laws specifically allow for 'social gambling' while prohibiting gambling as a business. Business gambling occurs when a person or organization operates a gambling hall that collects fees or takes a portion of the amount the players bet. For example, a person who holds a 'casino night' party and charges an entry fee is engaged in an illegal activity in a state that prohibits business gambling or gambling for profit. So-called “social gambling,” where the players are all equals an no one is collecting fees or making a profit apart from the outcome of the game -- such as in a home poker game -- is often not considered illegal. However, even social gaming is illegal in some states.
Penalties
While all states criminalize gambling to some extent, they also have vastly different penalties associated with gambling crimes. The type of penalty someone faces after being convicted of illegal gambling largely depends upon the state and the circumstances of case, though sentences typically involve many of the same types of penalties. Gambling can be classified as either a misdemeanor offense or a felony, depending on the situation and state law.
Jail or Prison
Anyone convicted of misdemeanor gambling faces up to a year in a county or local jail, though state laws differ widely. Some states impose small maximum jail sentences for misdemeanor gambling, such as 20 days in jail. Felony convictions, on the other hand, can bring a year or more in prison, and sometimes as much as 10 years, especially where organized, professional gambling is present.
Fines
Misdemeanor fines for gambling are quite common, and range from a few hundred dollars up to $1,000 or more. Felony gambling fines can be significant, sometimes as much as $20,000 or more. Fines can be separate from, or in addition to, jail or prison sentences.
Probation
Federal Statute Illegal Gambling Winnings
Instead of, or in addition to jail time and fines, courts can impose probation sentences for gambling convictions. These probation periods usually last 12 months or more. When a court orders probation it tells you to do (or not do) certain things. For example, the court may order you to stop gambling or to participate in a gambling addiction treatment program. You'll also probably have to report to a probation officer and stay out of trouble with the law. If you don't live up to the probation conditions, the court can revoke your probation and send you to serve the original jail or prison sentence.
Speak to a Lawyer
Federal Statute Illegal Gambling Rules
Illegal gambling charges can impose significant penalties and can have a serious impact on your life, even if you aren't convicted. Anyone charged with a gambling crime needs to speak to a local criminal defense lawyer at the first opportunity. A good defense attorney will know the gambling laws in your state and have experience with the local prosecutors, judges, and court system. It's always in your best interests to speak to a local criminal defense attorney anytime you are charged with a gambling crime.
The Supreme Court struck down a federal law that prohibits sports gambling Monday in a landmark decision that gives states the go-ahead to legalize betting on sports.
The court ruled 6-3 to strike down the Professional and Amateur Sports Protection Act, a 1992 law that barred state-authorized sports gambling with some exceptions. It made Nevada the only state where a person could wager on the results of a single game.
States that want to offer legal sports betting may now do so, and New Jersey plans to be first. Delaware, Mississippi, New York, Pennsylvania and West Virginia are among the states expected to quickly get into the legal bookmaking game.
The court ruled in favor of New Jersey and against the NCAA, NFL, NBA, NHL and Major League Baseball, capping a nearly six-year legal battle and overturning a federal statute that the sports leagues had adamantly stood by for more than 20 years.
'Congress can regulate sports gambling directly, but if it elects not to do so, each State is free to act on its own,' the court wrote its opinion. 'Our job is to interpret the law Congress has enacted and decide whether it is consistent with the Constitution. PASPA is not.'
The leagues first sued former New Jersey Gov. Chris Christie in August 2012 and won every step of the way -- until June, when the Supreme Court decided to take the case. Oral arguments were heard Dec. 4, and the justices ruled five months later.
Christie tweeted after the ruling that it was a 'great day for the rights of states and their people to make their own decisions.'
New Jersey's current governor, Phil Murphy, also cheered the ruling, saying he was 'thrilled' to see the high court strike down the 'arbitrary ban.' He said in a statement that he looks forward to working with the legislature to 'enact a law authorizing and regulating sports betting in the very near future.'
Federal Statute Illegal Gambling Legislation
The impact will be widespread. For nearly 26 years, Nevada has been the only state allowed to offer a full menu of sports betting options. A record $4.8 billion was wagered at Nevada sportsbooks in 2017.
New Jersey, with its much larger population, is expecting even bigger things. So are other states, with more than a dozen having introduced sports betting bills this year.
As the case played out over the past six years, the NBA and MLB pivoted their position on expanding legal sports betting and began lobbying on the issue in several states, including Connecticut, Illinois, Indiana, Kansas, Missouri, New York and West Virginia.
'We remain in favor of a federal framework that would provide a uniform approach to sports gambling in states that choose to permit it, but we will remain active in ongoing discussions with state legislatures,' NBA commissioner Adam Silver said in a statement. 'Regardless of the particulars of any future sports betting law, the integrity of our game remains our highest priority.'
Federal Statute For Illegal Gambling
MLB said in a statement that the ruling will have 'profound effects' and that it will 'continue to seek the proper protections for our sport, in partnership with other professional sports.'
'Our most important priority is protecting the integrity of our games,' MLB's statement said. 'We will continue to support legislation that creates air-tight coordination and partnerships between the state, the casino operators and the governing bodies in sports toward that goal.'
The NFL, NHL and NCAA, on the other hand, have sat on the sideline awaiting the ruling.
'The NFL's long-standing and unwavering commitment to protecting the integrity of our game remains absolute,' the league said. 'Congress has long-recognized the potential harms posed by sports betting to the integrity of sporting contests and the public confidence in these events. Given that history, we intend to call on Congress again, this time to enact a core regulatory framework for legalized sports betting. We also will work closely with our clubs to ensure that any state efforts that move forward in the meantime protect our fans and the integrity of our game.'
Tony Clark, the head of the Major League Baseball Players Association, called the ruling 'monumental, with far-reaching implications for baseball players and the games we love.' Clark said the topic must be addressed 'urgently and thoughtfully to avoid putting our sport's integrity at risk as states proceed with legislation.'
The U.S. joins other jurisdictions that allow legal sports betting, including Canada, the United Kingdom, Australia and France.
To start, it's likely that bets will have to be placed at brick-and-mortar establishments, but states are making plans to offer mobile sports betting in the future.
One research firm estimated before the ruling that if the Supreme Court were to strike down PASPA, 32 states would likely offer sports betting within five years. The American Gaming Association estimates that Americans illegally wager about $150 billion on sports each year.
Federal Statute Illegal Gambling Laws
Geoff Freeman, the president and CEO of the American Gaming Association, said in a statement that the court's decision is 'a victory for the millions of Americans who seek to bet on sports in a safe and regulated manner.'
'Today's ruling makes it possible for states and sovereign tribal nations to give Americans what they want: an open, transparent, and responsible market for sports betting,' Freeman said. 'Through smart, efficient regulation this new market will protect consumers, preserve the integrity of the games we love, empower law enforcement to fight illegal gambling, and generate new revenue for states, sporting bodies, broadcasters and many others.'
ESPN's Ryan Rodenberg and The Associated Press contributed to this report.