How the Wire Act Impacts West Virginia Sports Betting and Online Casinos

The United States’ Department of Justice Office of Legal Counsel (OLC) has released a memorandum altering its 2011 opinion on the Wire Act. The original opinion stated that the wire act only applied to sports betting. This newly released opinion, however, declares the Wire Act applies to all forms of gambling that cross state lines.

West Virginia sports betting launched after the US Supreme Court upheld the rights of states to legalize sports betting. The Wire Act was already in place at the time, so it is likely business as usual for WV sportsbooks. That doesn’t mean there aren’t potential obstacles ahead.

Recently, a West Virginia online casino gaming bill made its debut in the state legislature. If it passes it would legalize WV online casinos.

Although it may seem like the Wire Act shouldn’t affect online gambling conducted within states where it is legal, it’s not that simple. Even if all of the actual betting is done in the state, it’s possible some of the transactional data may cross state lines. If it does, then technically it violates the new opinion.

It should be noted that the OLC opinion is just an opinion. It doesn’t carry the force of the law.

AGA says Wire Act opinion “unfortunate”

Both the American Gaming Association and the National Indian Gaming Association have responded to the news. Both agree the new memo should have little effect on the current gaming industry.

Sara Slane, AGA’s senior vice president of public affairs, discussed the new opinion in a press release press release.

“It is unfortunate that the Department of Justice departed from well-established practice in reversing its previous opinion without a compelling reason to do so. However, the 2018 OLC opinion does not impact the ability for states and Tribes to legalize and regulate gaming on a state-by-state and tribal basis, or for companies to provide the exciting products and entertainment experiences our customers want.”

This ruling is difficult for the AGA to understand, based on what’s already been put into place regarding legal gambling procedure.

Slane continued:

“With over 4,000 regulators and billions of dollars allocated to compliance, casino gaming is one of the most highly regulated industries in the country and for decades has provided its customers with cutting-edge products in a safe, regulated environment pursuant to state, Tribal and federal law. We will work with all stakeholders to preserve the ability of states and Tribes to regulate gaming, and we encourage DOJ to investigate and shut down illegal, unregulated gambling operators who prey on consumers.”

NIGA: Wire Act changes “hold great importance”

NIGA had a similar reaction to the DOJ’s statement. In a press release, it discussed how the debate over the legality of online gambling has been ongoing for two decades.

NIGA chairman, Ernie Stevens, Jr., said:

 “We are reviewing the opinion, but expect that like the 2011 opinion it poses more questions than answers. Any changes in the gaming landscape hold great importance to our Member Tribes.”

Based on the 2011 opinion, it could mean next to nothing. However, it’s possible the DOJ tries to enforce this ruling. If it chooses this course it can create actual issues for casinos and sportsbooks in the future.

Other obstacles for WV online gaming

A more current and tangible obstacle West Virginia is that West Virginia Lottery officials may not pursue the legalization of online gaming at this time.

Of course, legal sports betting is already live in the Mountain State. However, it may be some time before online casino gaming becomes available, too.

The Lottery director John Myers made it clear he would like to see WV’s five casinos launch their online sports betting apps prior to expanding other online gaming.

There may not be much clarity right now. Fortunately, there is a lot of motivation to eliminate the ambiguity. Expect continued legal analysis during what could be an exciting next few months in the online gambling industry.