If you ask the question “which states allow online betting” to a native English speaker, the response you will get is “all of them”. However, that is not exactly true. In fact, there are several legal barriers that you need to clear before you can engage in betting online in any state.
Federal Law Versus State Law
The first thing to note is that while most states allow online betting, it is still a violation of federal law to do so. In fact, the Unlawful Internet Gambling Enforcement Act of 2018 makes it a felony for any business to engage in or facilitate an unlawful internet gambling transaction. Violating this act can result in up to five years of prison time and a fine of up to $250,000.
This act essentially prohibits all forms of internet gambling, including sports betting, with very few exceptions. It does not, however, restrict the ability of the state to regulate and restrict internet gambling.
Registering With The DGA, COA, And USJ
The second thing to note is that in order to legally engage in sports betting in any state, you must register with the state gaming agency, the state college athletic association, and the United States Joint Entrance Examining Board. This is particularly important if you live in a state where internet gambling is legal because you must then register as a sports bookie or pari-mutual betting agency.
If you plan on operating a sports betting website, you must also make sure that you are properly licensed and insured by the National Football League (NFL) and the North American Association of Professional Football (4A’s) in the state where you plan on doing business.
Get A Visa
The simple answer to the question “which states allow online betting” is New Hampshire. Despite the fact that it is one of the least populated states in the country, New Hampshire has legalized online sports betting and even offers a tax credit to legal gamblers.
On the opposite end of the spectrum, you have South Dakota. Here, the Supreme Court upheld a law that prohibited all forms of online gambling. In fact, this law was eventually repealed, but not before it caused great damage to the state’s gambling industry. For instance, many gambling companies relocated to neighboring states where they could operate legally. This led to the loss of hundreds of jobs in the state. The repeal of South Dakota’s online gambling ban came with a 10% sales tax on all sports tickets and bets.
Check Out The 2018 Law Changes
It is important to keep up with the times and be aware of any recent changes that affect your business. Since online gambling was made legal in some states, regulators have been scrambling to catch up with evolving technology and changing business models. As a result, the rules and regulations regarding legal sports betting and wagering have been amended and updated several times in the past two years.
In July 2018, the NCAA enacted sweeping changes to its sports betting policy. The organization now permits student-athletes to place bets on their own teams’ games and allows them to benefit from legalized wagering outside of the state of college campuses.
Perhaps the most significant change came in October 2018 with the 2018 United States Justice Department (US DOJ) Guidelines for the Federal Enforcement of Internet Gambling. Although the DOJ maintains that it does not intend to target individual players, it also pointed out that certain “high-risk” gambling activities can be harmful to society. As a result, the DOJ is now prosecuting individuals who promote illegal gambling schemes through social media platforms like Facebook or Instagram.
The DOJ’s stance is in direct opposition to the US Federal Trade Commission (FTC), which issued its own set of guidelines in April 2018. The FTC recommended that Congress and the states should approach internet gambling “from a consumer protection perspective, rather than a regulatory or prohibitionist stance”. This split in opinions is what led to the emergence of several different sets of guidelines and regulations pertaining to online gambling.
If you plan on starting a business involving sports betting, it is important to research the legal requirements in your chosen state. Many states, including New Hampshire, treat online betting as a gaming activity and therefore subject to their licensing and regulation. In order to legally engage in sports betting in any state, you must be registered with the state gaming agency, the state college athletic association, and the United States Joint Entrance Examining Board. In addition, you must get a visa to enter the state, satisfy yourself that you are a suitable person to operate a casino, and comply with the legal requirements and limitations regarding sports betting laid down by the state.