NTRA: Wire Act opinion will be reviewed, developments monitored

By: Tom LaMarra

Posted: Jan. 15, 2019

The National Thoroughbred Racing Association Jan. 15 said a revised United States Department of Justice opinion on the scope of the federal Wire Act doesn’t impact interstate online wagering on horse races.

The opinion, dated Nov. 2, 2018 but made public Jan. 14, states that “the prohibitions of (the Wire Act) are not uniformly limited to gambling on sporting events or contests.” The Department of Justice in 2011 issued an opinion that Wire Act prohibitions are limited to sports gambling.

Since 2011, multiple states have authorized online casino-style gambling as well as online components for state lotteries. How it all plays out in light of the revised opinion remains to be seen.

“As expected, yesterday the Department of Justice issued a lengthy opinion reversing its 2011 opinion by stating that the Wire Act applies to all forms of online wagering, not just sports wagering,” NTRA President and Chief Executive Officer Alex Waldrop said. “This opinion does not affect our longstanding right to conduct interstate online wagering on horse racing as long as it is conducted in compliance with the Interstate Horseracing Act. We will continue to review the opinion and update the industry as this situation develops.”

The IHA, which passed in 1978, requires consent from various parties to accept interstate wagers. The IHA was amended in 2000 to include bets made via telephone or “electronic means” such as the Internet. For roughly a decade, horse racing had a monopoly on online betting.

The DOJ opinion, written by Steven Engel, an assistant attorney general in the Office of Legal Counsel, also concludes that the Unlawful Internet Gambling Enforcement Act of 2006, which focuses on the payment systems for illegal Internet gambling, doesn’t modify a section of the Wire Act.

“This Office concluded in 2011 that the prohibitions of the Wire Act in 18 U.S.C. § 1084(a) are limited to sports gambling,” the opinion states. “Having been asked to reconsider, we now conclude that the statutory prohibitions are not uniformly limited to gambling on sporting events or contests. Only the second prohibition of the first clause of section 1084(a), which criminalizes transmitting ‘information assisting in the placing of bets or wagers on any sporting event or contest,’ is so limited. The other prohibitions apply to non-sports-related betting or wagering that satisfy the other elements of section 1084(a).”