Sports Betting Legalization

Sports betting legalization has been years in the making and many states are still working their way through new laws to allow you bet on football safely and securely. Every day, there is betting news from state governments and new sportsbook operators announcing new deals, new places to bet, mobile registration and more. NFP updates these legal developments and reviews the sportsbooks doing business in each state (check the map below to find news on your state).

We also take a historical look at the Wire Act of 1961 and PASPA (the Bradley Act) of 1992 which had effectively prohibited sports wagering, except for Nevada and a few states with small sports lotteries.

Betting on sporting events has always been a way for competitive folks to add excitement to a game or match. Unfortunately, it attracted organized crime in the early 20th century, turning a fun pastime into a dangerous vice.

Fast forward to the 1940s and East Coast bad guys tried their hand at sports betting in Nevada, where gambling had been legalized. That was OK, but there weren’t many people in Vegas in the 1940s, so bookies and their bosses had to call back East to book wagers and tap into the growing population centers of Philly, New York, Boston and into the Midwest with gambling centers such as Detroit, Pittsburgh, Cleveland, Chicago and Milwaukee.

That increased business greatly but also greatly concerned the federal government who wanted to crack down on this growing enterprise. A few American presidents tippy-toed around the problem before JFK’s administration passed The Wire Act in 1961. It was intended to criminalize phone calls or any other means to transmit bets or betting information via phone or telegraph. (Much more on The Wire Act here).

It would be the law of the land for 50+ years, even as some states tried to argue that Nevada shouldn’t be the only state to benefit from the jobs and tax revenue that sports betting generated. In 1992, the Professional and Amateur Sports Protection Act (PASPA) was passed, which cemented the Wire Act federal umbrella prohibition of sports betting.

In the mid-90s, the Wire Act was challenged by ‘offshore’ sportsbooks who domiciled in Costa Rica, Antigua and Panama (where betting was legal) and took advantage of this new thing called the Internet to create online sportsbooks. Americans would not be wagering in the United States if they bet online at a sportsbook in Costa Rica, so dozens of the operations popped up.

The Department of Justice wasn’t amused, charging these operators with violating the Wire Act. Some gave up, turned themselves in, were punished. Others remained offshore and continued to run their businesses and took business from bettors from all over the world, including the US. They claimed trade treaties and international law permitted them to do so.

Another awkwardly worded act was passed in 2006, which aimed to further chase bettors away from online sportsbooks. UIGEA (Unlawful Internet Gambling Enforcement Act) criminalized the transfer of money or credit from US bettors to offshore sportsbooks. Again, some operators gave up, almost the entire online poker industry which has boomed for five years was decimated. But others remained, finding creative ways to allow bettors to fund their betting accounts and to receive payouts for their winnings.

By 2010, states were pushing harder to have PASPA and the Wire Act repealed as unconstitutional. After several battles with the professional sports leagues – who wanted to preserve the betting prohibitions – and the NCAA, the State of New Jersey eventually got the case to the US Supreme Court. On the second try, justices agreed that PASPA was unconstitutional and opened the door for states to set up their own sports betting industries.

States can opt in or opt out. Where is sports betting legal in your state? Where can you bet? What is the legal betting age and can you wager online or via a mobile betting app? Read up on every state’s progress in the sports betting legalization continuum.