DOJ says Wire Act only applies to sportsbetting

WASHINGTON, D.C. -- The U.S. Department of Justice on Friday revealed that it has changed its long-held position and found that the federal Wire Act of 1961 only applies to sports betting.

The new opinion on the Wire Act represents a dramatic shift in policy for the Justice Department, which had long argued that the law illegalized all forms of Internet gambling, especially poker.

The federal law enforcement agency was asked in 2009 to analyze the scope of the Wire Act by New York's lottery division and the Illinois governor's office regarding their plans to use the Internet and out-of-state processors to sell lottery tickets.

In a 13-page legal opinion written by Assistant Attorney General Virginia Seitz dated Sept. 20, the department noted that nothing in the materials supplied by the criminal division suggests that the New York or Illinois lottery plans involve sports wagers but were just lotteries. The opinion was posted Friday.

"Accordingly, we conclude that the proposed lotteries are not within the prohibitions of the Wire Act."

Supporters of online poker applauded the Justice Department's opinion.

"This is a much needed clarification of an antiquated and often confusing law," said John Pappas, executive director of the Pokers Players Alliance. "For years, legal scholars and even the courts have debated whether the Wire Act applies to nonsporting activity. Today's announcement validates the fact that Internet pokers does not violate this law."

Pappas said the opinion makes it even more important that Congress act to clarify the law.

"The Department of Justice's interpretation regarding the scope of the federal Wire Act validates the urgent need for federal legislation to curb what will now be a proliferation of domestic and foreign, unlicensed and unregulated gaming websites without consistent regulatory standards and safeguards against fraud, underage gambling and money launderings, the American Gaming Association said in a statement.