The Unlawful Internet Gambling Enforcement Act of 2006

Internet gambling has been the subject of much discussion over the past several years.  The Unlawful Internet Gambling Enforcement Act (UIGEA) was passed in 2006.[1]  A congressional study found that Internet gambling has been a source of personal indebtedness and that existing law enforcement means of regulating the growing industry has been inadequate.[2]  Online poker companies have come under fire from the Department of Justice under this Act and its associated predicate acts.[3]  These types of cases have dealt with companies that are not located within the United States.[4]  While these companies are at risk, the UIGEA seems to carve out an exception for gambling practices held exclusively within a State.[5]  Moving along these lines, the District of Columbia has been the first to legalize virtual gambling.[6]  With many state budgets facing crises, gambling has been looked upon to increase state revenues.[7]  While many states have been slightly reluctant to explore this area, the Great Recession has put the states in a position to seriously consider the possibility of adding revenue through Internet gambling.[8]  Many precautions may be put into place to keep states within the bounds of the UIGEA, but the legislative history of the act may put states into a gray area.[9]  While the UIGEA seems to carve out an exception for purely intrastate activities, the UIGEA does not seek to amend existing law on these types of activities.[10]  Without clear guidance, states may run afoul with the Department of Justice and their presumable stance on prohibiting “’all forms’ of online gambling.”[11]  State officials should be cautious of the lack of clarity on this issue as well as balancing the needs of a budget crisis with the potential of putting their citizens at risk of personal indebtedness.