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States’ Rights and Internet Gambling | Commentary

By Lyle Beckwith As Congress considers legislation to clarify that the Wire Act bans Internet gambling (and not just sports betting) the issue of states’ right to control gambling policies within their borders is a focal point. Central to that issue is the delineation between interstate and intrastate gambling activities. So it’s time someone pointed out intrastate Internet gambling is an oxymoron.  

States looking to put their lotteries online, for example, want to pretend that this constitutes purely intrastate gambling activity, but they’re wrong. Unlike brick and mortar casinos and convenience stores that sell lottery tickets, the Internet is accessible any time, by anyone, from anywhere. Sure, there are technologies that can help locate a computer or a smartphone. But circumventing those technologies merely takes a search engine and about two minutes. A simple online search yields articles such as “How to Fake Your Location in Google Chrome,” “How to Disable or Fake Your Location in Firefox,” “Internet Explorer & Chrome,” and “Fake GPS Location.” There are also articles with instructions on how to fake your location on android phones, iPhones, iPads and other specific devices. And this is just the tip of the iceberg. Presumably, as some states go online with lotteries and other gambling games, the demand for programs that will allow people in other states to play those games will only grow. And, by the way, virtually all of these methods of fooling location verification are free.  

The truth of the matter is, with the help of programs such as those listed above, you can get online and play the Georgia lottery (which, by the way, is already offering different types of games in addition to the lottery) from wherever you are right now. It requires virtually no time and no technological know-how. Plus, the Georgia lottery’s online age verification process entails checking a box to “verify” you are at least 18 years old — that way, kids can get past the age check even faster than they can get past the location check.  

Herein lies the real states’ rights problem. Say I’m in Hawaii, a state that does not allow any gambling. But all of a sudden, I can get online — apparently no matter how old I am — and play another state’s lottery from anywhere and everywhere with Hawaii. That means the state of Hawaii has lost its ability to control what gambling goes on within its borders and its citizens can gamble from home, work, the car and even church using their choice of computer, tablet or mobile phone. The rights of Hawaii and every other state in the country to limit the gambling that can be done within its borders are completely undermined by a single state offering online lottery sales.  

Not only are states unable to stop out-of-state gambling once their games are on the Internet, there is no enforcement regime to try to make them do so. The states are left to police themselves. Nothing requires states to employ the most advanced geolocation technology on the market, or even technology that works at all. And, practically speaking, states are unlikely to turn away more lottery revenue by trying to block out-of-state gamblers. And other states have no recourse if a state fails to stop out-of-state (or underage) gamblers.  

Today, the vast majority of states prohibit some types of gambling. Two states do not allow any gambling of any kind and eight states do not have lotteries. State policies limiting or prohibiting gambling activities will become meaningless, however, as soon as people can find and play whatever games they want on the Internet.  

And, no one should pretend that lotteries will just limit themselves to what looks like lottery games online. Overseas, Internet “lotteries” look like full-blown casinos with slot machines. The UK lottery, for example, which has been online for years, offers dozens of different games that do not even remotely resemble traditional lotteries. And the Georgia lottery, which has been online for a matter of months, is already headed in that direction.  

So, as members of Congress formulate their positions on Internet gambling and consider the states’ rights part of the issue, they should know that anything put on the Internet can be accessed from anywhere in the U.S. (and accessed easily). Unless Congress wants to require that every state in the union allows every form of gambling to be legal in their states, it needs to pass the Restoration of America’s Wire Act to protect states’ ability to make some forms of gambling illegal.  

Lyle Beckwith is vice president of government relations for the National Association of Convenience Stores (NACS).

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