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NJ Online Casino Legal Overview

Is online gambling legal in New Jersey?

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. Legal online poker is regulated and governed by two different laws in the United States government.

Legalities before online gambling 

The Federal Wire Act - otherwise known as the Interstate Wire Act of 1961 - was put in place to keep 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.

Legalities after online gambling 

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 but threatening charges of money laundering and illegal gambling.

There was a re-modification of the Federal Wire Act in 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. This excluded all forms of online gambling outside of sports betting. The act would no longer have a voice over online gambling.

NJ Online Casino Law

NJ online casino sites are licensed through Atlantic City casinos. The law grants the land-based casinos in New Jersey the right to apply for a permit to start an 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 who 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.

Legal online sports betting

There had been a federal ban on US sports betting in the past under the Professional and Amateur Sports Protection Act (PASPA). This law was passed in 1992, signed by President Bush, banning states from regulating or taxing sports betting; however, allowing immunity for several states who had previously allowed sports betting within their borders. These states included:

  • Nevada
  • Delaware
  • Oregon
  • Montana

Although the law was enforced across the US, reports continued to prove that billions of dollars were being gambled each year on US sports betting.

PASPA was later repealed after the Supreme Court consensus declared this law unconstitutional. The majority opinion stated that PASPA violated a constitutional rule of which states that the federal government shall not require states to act against their interests.

Five states took the lead in changing the sports betting game for the US. Legal online sports betting heavily impacting the economy and the way we look at this now-legal entity. These states immediately took the lead in regards to state revenue streaming from the sports betting industry and the number of legal, regulated sportsbooks.

  • Nevada
  • New Jersey
  • Mississippi
  • Delaware
  • West Virginia

Is online poker legal 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.

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.