Is It Legal to Market Online Casinos to U.S. Players?

If you’re considering marketing an online casino to U.S. players, then it’s important to understand how online gambling is already legally defined in the U.S. Generally speaking, online gambling is considered to be a form of ‘betting’. Although this might seem like a clear definition, it’s not always as straightforward as it seems. In the United States, lotteries and betting on sporting events are generally considered to be illegal, but online casinos operate under their own set of laws. This means that while some states have legalized online gambling, others have not. Additionally, the laws regarding traditional sports betting in the U.S. don’t always apply to online casinos.

Defining Online Gambling

For a long time, online gambling was defined as ‘playing casino games like blackjack and slots for money’. This definition has certainly changed over the years, and today it would be extremely misleading to define online gambling this way. Nowadays, the term ‘online gambling’ actually applies to a wide variety of activities including, but not limited to, the following:

  • Accounts where you can gamble online (i.e. Betfred, Ladbrokes, etc.).
  • Poker sites (i.e. Full Tilt, Poker Stars, etc.).
  • Lottery sites (i.e. Powerball, Mega Millions, etc.).
  • And even some social gaming sites (i.e. Paddy Power’s Poketeer).

Because of the variety of ways in which people are engaging with online gambling today and the fact that this variety exists within a single industry, it’s important to understand the relevant federal and state laws. If you’re considering marketing an online casino to U.S. players, then it’s important to know where you stand legally with regards to this industry.

Where Does Online Gambling Fall Under U.S. Law?

If you want to legally market an online casino in the U.S., then you have to abide by a few different rules. First of all, you must have a U.S. presence (i.e. a residence, office, or ATM). Additionally, if you want to operate in certain states then you must have a physical presence in that state (i.e. a registered agent or subsidiary). Finally, you must adhere to whatever laws and regulations that exist within your specific jurisdiction (i.e. city, county, or province).

As this is a constantly changing area of the law, it’s important to keep abreast of the latest developments. Fortunately, there are also well-established bodies who maintain a current database of relevant legal information (e.g. the Global Association of Specialized Regulators of Electronic Commerce or GASRECC). You can access this database directly from within the United States to ensure you’re operating within the legal limits set by the federal government and within your jurisdiction.

If you’re curious as to whether or not your particular business model qualifies as online gambling, then you can contact a legitimate U.S. based gambling lawyer to get some expert legal advice (i.e. Caplan Law Group).

Federal And State Laws Regarding Online Gambling

At the federal level, it is illegal for an online casino to accept US players in most states. States that do allow some form of online gambling often have very stringent licensing requirements coupled with restrictions on where and how players can engage in wagering. Fortunately for those states that do allow online casinos, the federal government does not regulate wagering or betting on sporting events (at least not in any direct way). This means that you can operate an online casino in NY and take US players without violating any state or federal law.

Legality Of Sports Betting And Lottery Playing

Traditional sports betting and lottery playing are generally considered to be forms of entertainment rather than games of skill or chance. This is why they are usually viewed as legal in the U.S. However, this is far from the case. It is illegal to engage in sports betting and lottery playing in most states. This is also true for online casinos that accept players from across the country. Additionally, since money is always involved in some way, there is also always the possibility of it being considered ‘illegal lottery proceeds’.

With that being said, it’s important to note that the government does allow individuals to engage in certain forms of sports betting and lottery playing. States that allow for these activities usually do so on a limited basis. For example, many states only allow for sports betting and lottery playing at specific venues and only for certain sporting events. Additionally, state governments that do allow for sports betting and lottery playing often do so under specific circumstances. For instance, Texas allows for sports betting and lottery playing as a state-sponsored activity (e.g. as part of a tourism campaign or to raise revenue).

Illegal To Operate An Online Casino In Most States

As previously mentioned, it is generally illegal for an online casino to accept players from within the United States. This is different from international players, who can often enter the United States and engage in wagering without being taxed or charged for legal activities. However, it is possible for certain states to specifically exempt certain businesses from illegal gambling laws if they meet certain criteria. To do this, a state’s legislature must pass a law granting an exemption to online casinos or betting companies. Additionally, the law must include specific language defining just what type of business it is allowable for an online casino to operate under the auspices of the exemption. Finally, once this exemption has been issued, the business in question must adhere to all existing federal, state, and local laws regarding electronic commerce. This makes it extremely difficult for online casinos to operate in most states due to the fact that they are subject to regulation by the federal government and any of the states that do allow for such activities.

What Should A Legitimate Online Casino Look Like?

If you’re looking to enter the online casino market then it’s important to have realistic expectations regarding what can and cannot be accomplished. At this point, it is still rather difficult to operate a legitimate online casino within the United States due to all of the red tape and paperwork that is necessary. With this being said, here are some of the best practices that can be followed to ensure that your business is operating within the law: