The U.S. now says the U.S. Wire Act bars all internet gambling that involves interstate transactions, reversing its position from 2011 that only sports betting was prohibited under the law passed 50 years earlier.

While the federal law specifically prohibits transmission of wagers and related information across state lines, the Justice Department's new interpretation will impact all online gambling because as a practical matter it's difficult to guarantee that no payments are routed through other states, said Aaron Swerdlow, an attorney with Glaser Weil Fink Howard Avchen & Shapiro LLP in Los Angeles.


The businesses that will be most directly affected are interstate lotteries that have become well established after 2011, said Dennis Gutwald, an attorney with McDonald Carano LLP in Las Vegas. The Justice Department's new reading of the law won't affect intrastate online wagering, where patrons bet only from within a single state.


Online poker and blackjack operations are much less developed than the lotteries, but they will have to examine how they can continue to be run in light of the Justice Department's opinion, according to Gutwald.

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