UIGEA Online Casino Ban Brings Legal Questions
The implementation of the UIGEA is scheduled to begin in December, and legal experts are pondering the questions the law raises. Because the intent is to prevent activity in the US by foreign online casino operators outside US jurisdiction, the effectiveness of the measure will depend on interpretations that will have lasting consequences for all online industries.
An article at ECommerce Times speculates on how successfully a law like the UIGEA can be applied to non-citizens operating in foreign jurisdictions. Part of the discussion centers on Douglas Rennick, the Canadian indicted for opening the bank accounts seized by the government which contained online poker payments.
While the article notes the language of the UIGEA does not address extraterritoriality, the principle of applying a nation's laws outside its borders, the authors feel that "Congress did have that intention, based on the fact that the primary targets under the UIGEA at the time of enactment were foreign entities."
Now comes the tricky part for online casinos, determining jurisdiction over activity that, through the Internet, involves several countries. The Zippo test is a precedent proclaiming that personal jurisdiction increases for online operators with the degree of interactivity, meaning that online casinos accepting bets from a state could be seen as acting within that state's jurisdiction.
The legal opinion of the authors is that the US has the right to arrest violators found within the US, even if activities occurred elsewhere, and the right to ask for extradition on Internet gambling site operators breaking US law. Whether those extradition requests would be honored becomes as much a political question as legal.
