Will Congress take another look at antiquated federal gambling laws?

Will US Online Gambling Ever Be Free From The Wire Act?

This article may be outdated. Get the latest news on Industry here.

The Wire Act still looms large over online gambling in the US.

The 1961 federal statute is the reason there aren’t yet any legal betting exchanges or other interstate options for punters. It’s also the key reason US online gambling operators spend millions of dollars establishing new technology stacks in every available state.

Whether the Act applies to all forms of gambling (or only sports betting) is currently the subject of a court in the First Circuit. But even ignoring the potential broader ramifications, the antiquated law has already proven itself detrimental to the sector’s growth.

So what are the chances of getting rid of the Wire Act’s constraints entirely?

Will Congress revisit the Wire Act?

Florida State University sports law professor Ryan Rodenberg says Congress will “more than likely” take a look at the Wire Act in the next four years, via a draft bill or perhaps even a hearing.

“As evidenced by the federal sports betting bill that was introduced in December 2018, there is some legislative interest in addressing potential Wire Act shortcomings,” said Rodenberg. (You can read about that bill here.)

“From the scope of the Wire Act’s safe harbor to tech-specific issues such as routing of sports bets across states lines, there are certain aspects of the 1961 law that Congress could revise or repeal entirely.”

Or will the DOJ carry the water?

There are, however, some who believe Congress has bigger fish to fry. The fight to be rid of Wire Act constraints might instead be fought with the Department of Justice and its appetite for enforcement.

James Trusty, an attorney with Ifrah Law, thinks Attorney General William Barr may be open to negotiations. Remember, last year’s attempt to expand the scope of the Wire Act was rushed through by Acting Attorney General Matthew Whitaker while Barr was undergoing confirmation.

“Barr is much more of a federalist and a believer in letting states be the primary decision maker on things like this,” said Trusty. He served as the chief of the DOJ Organized Crime and Gang Section back in 2011 when the DOJ published its previous Wire Act guidance.

The original spirit of the Wire Act

Trusty says an elegant solution for the DOJ would be to avoid litigation against lotteries and instead clarify that the Wire Act should only apply when addressing organized crime, rather than state-regulated activities like legal sports betting or online poker.

There’s too much uncertainty about Barr’s stance to consider that a sure bet, though.

In the meantime, state lotteries and their supporters are confident that the Wire Act’s scope will remain limited to sports betting — by trial if necessary. Ifrah Law represents the iDevelopment & Economic Association (iDEA) as amicus curiae in the New Hampshire Lottery case.

Whether the industry can get the Wire Act rolled back even further and truly take the shackles off the US sports betting industry remains a somewhat murkier proposition.

- Brad has been covering the online gambling industry in Europe and the US for more than four years, most recently as the news editor at EGR Global.
Privacy Policy