The legality of online poker has been under dispute ever since it surged to popularity in the 1990s. Online poker law varies from one state to another, so it’s hard to set any solid rules. It is also more difficult because online poker is fairly new, and there are no legal precedents for many of the issues. Although no one has been charged, tried, or convicted for playing online poker, there are existing rulings that make it possible.

That is why it’s important to know the online poker law in your area, so that you know your rights and limits. You can consult your local state laws or read up on sites like Doing Poker <www.doingpoker.com>. The following concepts may also be useful:

The Wire Act

Formally called the Interstate Wire Act of 1961, the Wire Act forbids “being engaged in the business of betting or wagering” via any type of wire communication. Since the Internet clearly fits the bill, the Department of Justice takes it to mean that online gambling in general is illegal. However, US courts have ruled otherwise. Some people also interpret “in the business of” as referring only to businesses, not individual bettors.  The US Fifth Circuit Court of Appeals has declared that the Wire Act covers only sports betting and excludes all types of online gambling, although the Supreme Court has not issued any rulings.

Gaming licenses

Each state may have different takes on online poker law, but there is little dispute on the issue of proper licensing. One needs a state-issued license to operate any gambling business, whether online or offline. However, none of the states are currently issuing licenses specific to online gambling, and it is still uncertain whether existing licenses extend to the online version.

Money laundering

The US Department of Justice is particularly concerned about the possibility of money laundering through online gambling. Because people can choose to remain anonymous online, it is hard to track down fraudulent accounts. Poker sites also use encryption methods to protect the users’ account information from being accessed by third parties, which makes it impossible to trace money laundering transactions. Many sites now log users’ IP addresses to resolve such issues, which in turn raises questions on privacy and confidentiality.

Problem gambling

In the UK, a growing concern is the increase in “problem” or “pathological” gamblers, or those who gamble so excessively that their career or personal lives are compromised. Recent studies show that the problem affects up to 75% of online gamblers, whereas only 20% of those who visit brick-and-mortar casinos have the problem. This is largely because of the privacy and instant payout offered by online poker. However, online poker law provides very little insight on the issue, and no such cases have been brought to court so far.