History of the 1998 Federal Government Charges Against Sports Betting Companies

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Posted formula1-betting July 2, 2023
Updated 2023/07/02 at 12:40 PM
7 Min Read

Sports betting is generally illegal in the United States, while internet gambling is nearly always prohibited. This argument relies heavily on the Wire Act. It was passed in 1960 to provide the federal government with a tool for pursuing illegal bookies trying to make money in horse racing. This law is also affecting various online casinos.

The federal government decided in 1998 to take decisive action against 14 individuals involved with internet sportsbooks. The 1998 action is a low point in the American Justice System and the global trend of liberalizing gambling laws. This 1998 arrest was the first ever for anyone involved in internet gambling and sports betting.

This episode is significant for four reasons. The government did not target individual bettors but only the operators of sportsbooks. Gamblers are rarely the targets of state or federal actions, whether they gamble online or in traditional ways. Regulators always target the companies who take bets and never the players.

The federal government targeted only Americans. Some defendants lived in the United States when the charges were brought. It was much easier to make arrests without needing to file additional charges, which would have led to the extradition of a foreign national. The government cannot charge sportsbooks owned by citizens from other countries, but it can go after Americans, no matter where they reside.

The government didn’t even accuse the defendants of violating the Wire Act. The defendants were accused of conspiracy to break the law, which is an entirely different issue. The feds could then bring charges without needing to prove the bets were sent by wire. The feds only needed to prove that the bet was placed and that an overt action was performed.

The only betting mentioned was on sports events. All other forms of gambling, including online poker, lottery, horse racing, table games, and lotteries, were not included. The reason for this is that it is unclear whether or not the Wire Act covers all bet types, including sports betting. While the Department of Justice maintains that this Act prohibits all forms of gambling, other courts find that it only applies to sports betting. The feds simplified prosecution by only including sports betting gk8.

We can deduce from the charges that have been filed that, while government officials still view internet gambling negatively, they are more concerned with targeting American sports betting sites and less interested in pursuing individual bettors. The government’s lawyers have also placed tremendous faith in the Wire Act to combat internet gambling. However, they still prioritize the safety of the people charged above all else by targeting sportsbooks. Individual bettors and foreign online casinos are both safe. However, this could change shortly.

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