US Online Gambling Developments

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That the legal situation in online gambling in the United States is so confusing is illustrated by the following news items. Two states have taken diametrically opposite calls over the same issue connected with online gambling.

Like many other states in America New Hampshire is facing a financial crunch. To make matters worse the revenue from the state lottery has fallen by 10%. In order to come out of this situation New Hampshire Lottery will start an online casino from July 1. The target given by the governor to New Hampshire Lottery is to generate $100 million a year from lottery and casino operations. The online casino will use software from Intralot. Initially four games will be offered to players. These are Super Slots, Speed Bingo, Baseball and New Hampshire Poker. Paul Holloway, the Commissioner of New Hampshire Lottery said, "These are instant games that allow people to buy their ticket, and instead of scratching it they play it on the Internet. They just don’t have to stand in the store and scratch it anymore."

Players who want to wager at these games have to buy physical tickets in person from New Hampshire Lottery outlets. The tickets have information coded on them and this allots credits on the gambling site. The players will not have to transfer funds to the online casino site using credit cards or through any payments processor. In this manner New Hampshire Lottery believes that the provisions of the UIGEA will not be violated.

This method is similar to that commonly used for online sweepstakes gambling at Internet cafes. Access to online casinos is provided to players who purchase phone time cards. Payouts are made by crediting time in the cards and the cards can be exchanged for cash at the Internet cafes. This system has been proliferating in North Carolina. The legislators have for some time doubted the legality of such systems under the UIGEA and other laws. In order to play safe the North Carolina Senate voted 47 to 1 for banning Internet cafes that offer this form of gambling. The confusion arises because though players are technically paying for Internet access time, they are actually placing wagers online. The bill will now go the state House of Assembly for a debate and vote on the issue.

In December 2009, regular video poker and slot machines became illegal in North Carolina when the state Court of Appeals upheld the ban. However, online gambling was not specifically dealt with in that law. In January 2010 the Kingston City council imposed a two month moratorium on Internet cafes that offered games of chance so that the legal questions could be examined more closely. This ultimately led to legislation seeking to ban such Internet cafes.

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