Gambling Legislation in New Jersey
New Jersey's mission for legal online gambling legislation has traveled down a long and winding road. The state has been the main contender in the fight with the federal government to allow states to decide on whether they want to allow legal online gambling.
With New Jersey's prominent gambling history, it's hard to imagine that this state didn't legalize online gambling until quite recently. To discuss the issue of legal online gambling in the US, one first must visit the history of the Federal Wire Act and why it exists in the first place.
Read below to find out how New Jersey was victorious in the case for legal online casinos and to see how you can get in on the action.
Licenses for NJ casinos are submitted through Atlantic City casinos. The law grants the land-based casinos in New Jersey the right to apply for a permit to start a legal online gaming site through partnerships with iGaming providers or operators.
The three types of licenses available are as follows:
- Casino Service Industry Enterprise License - This license is for software providers for land-based companies, as well as companies that provide lists of gambling players.
- Vendor Registrants License - This license pertains to online gambling service providers
- Ancillary Casino Service Industry Enterprise License - This license deals with companies providing services such as payment processing, geolocation, age verification, and customer identity. It also includes junket operators and affiliates.
On the 26th of February in 2013, the New Jersey legislature passed the new bill, legalizing online gambling. Senator Ray Lesniak had pushed the bill as a way to stimulate the Atlantic City economy, which was seemingly failing. Chris Christie signed the bill into law, with expectations of welcoming financial benefits to the state. And boy was he right.
Atlantic City and Online Casinos
Atlantic City has been known as the "Las Vegas of the East" for nearly a hundred years now. Yet unlike Las Vegas casinos - which have been antagonistic toward legalizing online gambling - Atlantic City casinos saw the opportunity that awaited them by embracing the online market.
Now, an online presence can rescue land-based casinos. The best case-in-point is the Golden Nugget. Their physical casino has consistently lost money for seven years, but Golden Nugget's online casino is the most financially successful operator in the U.S.
Since New Jersey state law requires that all online casinos have a partnership with a land-based casino, some Atlantic City casinos have formed legal partnerships with well-known European operators, such as 888 's partnership with Caesars casino.
The path to legalization had to do with the challenge of overcoming what had been a rather unimportant piece of legislature: the Interstate Wire Act of 1961.
Introducing the Wire Act
The Federal Wire Act - otherwise known as the Interstate Wire Act of 1961 - was put in place to restrict betting companies’ information from being transmitted across state lines via wire communications. This legislation was originally established to put an end to organized crime through interstate gambling. However, at the time this law was created, online gambling did not yet exist.
In modern society, our everyday life requires the use of the internet which relies on interstate wire communications. Therefore, this law has some jurisdiction over online gambling.
Later in 2006, another law passed in the US, known as The Unlawful Gambling Enforcement Act, which restricted banks from processing transactions coming from online gambling operators outside of the country. This pushed out some of the best real money poker sites and online casino companies by threatening charges of money laundering and illegal gambling.
At the start of 2010, a bill was introduced by Senator Ray Lesniak, which would allow casinos in Atlantic City to operate online casinos in the state. Lesniak's bill passed the Senate with widespread support. It passed with a 29 to 5 margin. However, when the bill ended up on Governor Chris Christie's desk, it was vetoed and suspected to have been turned down due to political motivation.
In April of 2011, online poker was shut down across the country. There was a re-modification of the Federal Wire Act in December of 2011, where the US Department of Justice (DOJ) reached a consensus that interstate transmission of wire communications not related to sports contests would no longer pertain to the Federal Wire Act law.
The following year, Chris Christie changed his stance on online gambling. Senator Lesniak introduced a new online gambling bill to cater to Christie's concerns. In December of 2012, the bill passed the state Assembly and it moved on to the Senate. The bill passed the Senate with a 33 to 3 margin. After a few amendments and revisions, the bill was finally signed into law on February 26, 2013.
The first online casino to gain a license in New Jersey was Caesars which started the process by April of 2013.
Legal Online Poker in NJ
When the Federal Wire Act was re-evaluated and excluded all forms of online gambling outside of sports betting, this excused online poker, allowing the activity to be legalized and regulated by state law.
Four states proceeded to pass legislation creating laws around regulated, legal online poker. Out of those four, three signed agreements to share online gambling pools. As a result, it is not strictly illegal to play poker online for money within the United States, however, it is crucially important to abide by the individual state laws surrounding the matter.
Moving forward with legal online poker meant new legislation for those states.
Delaware passed the Delaware Gaming Competitiveness Act in 2012, allowing for the legalization of online casino games - including online poker. Nevada followed the lead with the authorization of online poker licenses in 2013, as they launched the first-ever legal, regulated online poker site in the US.
New Jersey then introduced online gambling, passing legislation for the regulation of online gambling activities. Atlantic City casinos could operate NJ online casino sites along with legal online poker sites.
A few years later in 2017, Pennsylvania became the fourth state to legalize online poker in the US, beginning the process of legalization and regulatory matters for online poker sites.
As of 2019, there are over 20 casinos that now offer or have licenses for online gambling in New Jersey. The mammoth Parx casino, with its physical location in Pennsylvania, is the latest to join in on the action.
The Online Gambling Race
Now that online poker, legal online casino sites, and legal online sports betting are monitored and regulated in the Garden State, casinos and racetracks are racing to launch their own websites and mobile casinos.
As the economy grows, so does the competition. And competition among legal online casinos is great news for you. Casinos are trying to attract new customers with special bonuses and deals for first-time deposits. Have a look to see what might be a good fit for you.
Additional states are joining in on the legalization of online casinos - with West Virginia and Michigan being the latest to legalize online gambling. Of course we're proud to say that New Jersey is leading the pack in terms of numbers of legal online casinos, variety of games, and best bonuses for new and existing customers.
It now depends upon individual states to decide whether online casinos will be legal within their boundaries. Seeing the success of New Jersey, it's become increasingly difficult to step away from this table.
Frequently Asked Questions
How old do I need to be to bet in New Jersey?
All players must be at least 21 years-old to bet, or even to receive an account with a legal online casino in New Jersey. Legality is usually established by providing the last four digits of your Social Security number. This is used only to confirm your identity.
Can I just use a VPN and play New Jersey online casinos from another state?
VPNs are Virtual Private Networks. They allow you to set up an IP address in a place where you are not physically located. You might be wondering, "Can I set up a VPN in New Jersey and play from another state?"
The answer is, yes...if you want to get barred from the casino for life. While casinos might not be able to trace a VPN back to your physical address, they are able to tell when you're using a VPN. Casinos will be fined heavily if they allow someone to place bets while they're not in the state, so they do not take kindly to a false representation of your location.
You may be barred from a legal online casino if caught using a VPN. But you can play from a smartphone, tablet, or computer from anywhere in the state.