During the late 1990’s, online gambling started to become popular. In fact, in 1998, revenues from online gambling reached $830 million. In response, the United States Department of Justice announced that the Wire Act applies to all forms of Internet gambling.
Although online gambling is legal in some states, it is illegal in others. The United States Congress has attempted to regulate online gambling, including the Internet Gambling Prohibition Act, which was introduced in the Senate in 1999.
The Internet Gambling Prohibition Act would have banned online gambling for U.S. citizens. However, the bill was defeated in the Senate in 2002. In response to the legislation, federal prosecutors warned PayPal that it could be subject to prosecution.
One of the most controversial aspects of the Internet Gambling Prohibition Act is its lack of a statute of limitations. A violation of the Act could result in a fine of up to six months or a year in prison.
The law may also be interpreted in ways that obstruct its enforcement. For instance, in a recent case, federal marshals confiscated $3.2 million from Discovery Communications, which accepted advertisements for a website called Tropical Paradise.
On the other hand, the United States Department of Justice’s announcement that the Wire Act applies to all forms if Internet gambling has garnered criticism for not having a legal basis. Some state officials have expressed concern that the Internet may be used to carry illegal gambling into their jurisdictions.