It is an interesting time for online gambling in the United States. As many people are aware, the Supreme Court of the state of Washington recently upheld a law banning all forms of online gambling, including poker. As a result, popular online poker website PokerStars pulled out of the state’s market and no longer allows Washington residents to play there. But why would they do that?

Understanding the situation requires understanding the U.S. Constitution, federal laws versus state laws, the American legal system and more. If you’re not familiar with all of that, here is kind of a crash course in what you need to know.

In 2006, the U.S. passed the federal Unlawful Internet Gambling Enforcement Act (UIGEA) as part of the SAFE Port Act. When that happened, many online gambling operators pulled out of the U.S. market and stopped accepting American customers. That includes Party Poker, who at that time was the biggest online poker site worldwide and in America. PokerStars, however, remained in the market and clearly stated that they would continue to accept American customers.

They could do that because, despite what the federal government may sometimes say, there is no federal ban on online gambling or online poker (some don’t consider poker to be gambling at all, since it’s a game of skill). UIGEA does not make anything illegal that was previously legal (that position was verified by the Supreme Court). UIGEA holds banks accountable for the transfer of funds from illegal online gambling, but does not actually make online gambling illegal. Since there was no previous federal law banning online gambling and UIGEA did not do that, the logical conclusion is that no such federal ban exists. For that reason, PokerStars felt free to continue accepting American customers.

While there is no federal law banning online gambling, there is a state law banning it in Washington. When the law was challenged in court, the state Supreme Court upheld the law, reaffirming that online gambling and online poker are not legal in the state of Washington. Under state law, the players and the online gambling companies can both be held accountable for violating the law, which can include jail time.

Since allowing Washington residents to gamble on their site would be in clear violation of state law, PokerStars placed a ban on those who live in the state. Other online casinos and poker rooms are likely to follow their lead. Currently Washington is the only state banned by PokerStars.

There’s another factor at play as well. It is likely that if the U.S. ever decides to regulate online gambling, they will not allow online casinos to obtain a license if they are guilty of illegally accepting U.S. customers. Such a provision is in the current bill in the House that would repeal UIGEA. If such a provision became law and PokerStars continued to accept players from Washington, they would be ineligible for a U.S. license. That alone is worth pulling out of the market.

Tags: American online gambling, online gambling, online poker, PokerStars, U.S. online gamblign, Washington gambling law, Washington online gambling