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Is Internet Sports Betting Legal in the United States?

By Joseph Falchetti

* Always check your local laws before placing sports bets online or through any through other source. The point of this article is to give readers a brief idea of where the US legal system stands in regards to the subject of internet sports betting at the time of this writing. Laws are constantly changing on local state and federal levels, so we encourage our readers to do their due diligence before placing any wagers.

Sports Betting in the United States - Legal or Not?There is no doubt that either you or someone you know bets on sports, either through a local bookie or an online sportsbook. Times have changed since the heyday of offshore betting sites in the early 2000s, and though the NFL would like you to think differently, sports betting is a significant reason in the league’s rise to dominance over recent years.

Despite the fact that sports betting and other forms of gambling are embedded in American culture, there are enormous misconceptions regarding the legality of betting sports online. There are also several advantages to taking your action online versus staying with your neighborhood bookie.

In the US, is it Illegal to Bet on Sports on the Web?

Sports betting online in the USA is neither legal nor expressly illegal on a Federal level, and depending on which state you live in, laws can vary. However, in the vast majority of states, there is no penalty for placing a bet with a bookmaker (live or online), and even if it is a crime; it is usually a misdemeanor which comes with a small fine. In almost all cases, these laws are rarely enforced. In fact, even that is an understatement.

To date, no US citizen has ever been charged federally for gambling online, and that includes all forms of gaming, sports, poker and casino. Only Jeffrey Trauman, a citizen of North Dakota was charged on the state level in 2003 for betting sports online. With winnings over $100,000 alleged by prosecutors, he pleaded guilty to a misdemeanor and was given a $500 fine.

The bottom line is that, if you are an individual who is placing bets at an online sportsbook – you almost assuredly have nothing to worry about.

Haven’t Things Gotten Harder Though?

Yes, the passage of the Unlawful Internet Gambling Enforcement Act (UIGEA) in 2006 was a tremendous blow to online gambling operators and bettors, but even this landmark legislation in regards to online gambling did not criminalize the activity. It limited the ways that sports bettors could get money online and criminalized foreign operators of gambling sites.

The industry has taken a step back since the turn of the century in some ways, but options for players are still plentiful. There are dozens of sportsbooks available for US customers, and there is no shortage of markets no matter how large or small you want to bet. Many sites still take bets as small as $1.00 and as large as $100,000.

How Do I Find a Safe Online Sportsbook?

This can be tough, especially for new players. There have been many situations in my decade-plus of experience in offshore betting where sportsbooks have gone under and ran off with player funds. These times are rare, but they do happen.

When choosing an online sportsbook, players should do their research before depositing. While there are many “watchdog” sites for online bookmakers, these sites don’t always have the player’s best interest in mind. They are motivated by affiliate profits, and while they don’t usually outright lie to bettors, they may mislead them in some many situations.

The best course of action for bettors looking for a sportsbook is to use a variety of portals to research. This includes watchdog sites and reviews, along with personal experience from friends and most importantly, sports betting forums. These are an excellent resource for up to date information and news on the offshore betting industry.

It also depends on which sports you want to bet on, the types of promotions you’re most interested in, and the deposit options you prefer. For example, Visa is the most popular deposit option, but some bookmakers offer other ways to deposit as well.

What are the Advantages of Internet Betting Compared to My Local Bookie?

There are almost too many to count. The odds, in almost all cases will be better. Many sites offer reduced juice, that is, -105 pricing on points spreads rather than the -110 that almost all locals offer to bettors. Also, the list of markets, including proposition bets, exotics and many foreign domestic sports will be much more expansive when using an online bookie. Overall, the experience, odds offered, mobile betting applications and customer support are light years better than when dealing with a neighborhood bookie.

The Future

While statewide online poker markets are now beginning to blossom, sports bettors may have to wait awhile for full scale legalization and regulation. While there are still several internet sportsbooks available to bettors in the United States, many others have left the market. The United States government (the DOJ in particular) have scared away many of the most reputable bookmakers, leaving us with only a few we can trust. It’s unfortunate, because the government has caused a situation where all forms of online gambling are now more dangerous for the players.

Will this change? It’s difficult to say, but for now, I doubt it. In my opinion, the American gov’t has yet to understand why their bad decisions have been bad for the citizens, and have yet to show any desire to fix these bad decisions.

And finally, it’s a matter of the game. While some states have been able to pass their own laws legalizing poker (New Jersey and Nevada), poker has a better argument as a ‘skill game’. While the term ‘skill game’ could be argued to no end, it seems to be an argument that is beginning to work for poker. Unfortunately, even though there is skill in sports betting, it’s a tougher argument to make than it is for poker.

My guess is that poker will become legal, at least in several states within the US. Casino games and sports betting have a more difficult road, so I think they will be in the grey area for many years to come.