The Interstate Wire Act of 1961, often called the Federal Wire Act, is a United States federal law prohibiting the operation of certain types of betting businesses in the United States. It begins with the text:
- Whoever being engaged in the business of betting or wagering knowingly uses a wire communication facility for the transmission in interstate or foreign commerce of bets or wagers or information assisting in the placing of bets or wagers on any sporting event or contest, or for the transmission of a wire communication which entitles the recipient to receive money or credit as a result of bets or wagers, or for information assisting in the placing of bets or wagers, shall be fined under this title or imprisoned not more than two years, or both.[1]
The law has been interpreted by some, including the Department of Justice, to mean that all online gambling is illegal. However, U.S. Courts have ruled to the contrary. Also, many believe the phrase "in the business of" means only businesses are affected. Some argue that the law only covers sports betting, and not other forms of gambling such as poker.
The U.S. Fifth Circuit Court of Appeals has ruled that the Wire Act applies only to sports betting and not other types of online gambling.[2] TheSupreme Court has not ruled on the meaning of the Federal Wire Act as it pertains to online gambling.
Nevada Approves Mobile Sports Betting
The Nevada Gaming Commission recently came to a crucial decision that will make online sports gambling in the state legal in the near future. The Commission rendered its approval of a project developed by the Leroy Group. The "Leroy App", as the program is being called, will permit Nevada residents to post sports wagers from their cellular phones.
The Leroy Group is a division of American Wagering, a company that specializes in managing race and sports betting operations. John English, Senior Vice President of Business Development for American Wagering, expressed his pride at the new product meeting the approval of the Commission.
“The approval of the Leroy's App (signals) the creation of a new market segment for sports wagering,” English told reporters. He also said that Nevada regulators “placed significant challenges” on the company to insure that the app would be restricted to the state’s residents, but mentioned that American Wagering “rose to the challenge and succeeded.”
Previously, Nevada gaming regulations prohibited the use of mobile phones or other communication devices in or around a casino sports book area. The Wire Act of 1961 prohibits the use of any telecommunications device to relay gambling information over state lines, which is why the NGC specified that the application could only be available in Nevada.
The Blackberry version of the application has received an initial approval, though the Android version is awaiting approval through the same process. The company has yet to reveal any plans to develop the application for Apple’s iPhone platform, one of the most popular mobile phone operating systems, or any other devices.
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