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Federal Gambling Crimes And Related Offenses

Gambling has been part of our nation’s history for generations. As time goes on, new efforts are underway across the U.S. by local legislatures to legalize sports gambling. Nevertheless, the federal criminal law still has several statutes on the books aimed at preventing illegal gambling.

If you have been charged with gambling, it is imperative that you do not incriminate yourself. Get a free consultation with me, attorney Peter Katz, to better understand what the charges mean and what you can do to best defend yourself. Call the Law Offices of Peter Katz at 609-900-2648 to set up a meeting with me.

Transmission Of Wagering Information And Penalties

In 1961, Congress passed the Interstate Wire Act to prohibit certain betting businesses and organized crime in the United States. Title 18 U.S.C. Section 1084 makes it a crime for anyone involved in gambling to knowingly use interstate wires to receive money or credit from bets or wagers. The statute also punishes those who receive information to assist them in placing bets or wagers. Violators of this offense could face imprisonment for up to two years, a fine or both.

The Interstate Wire Act and sports betting remain a divisive issue in the legal community. Just recently, the United States Court of Appeals for the 1st Circuit held in New Hampshire Lottery Commission v. Rosen that the Wire Act’s reach extends only to bets and wagers in the context of a sporting event or contest – nothing more. Charges for gambling may also involve other charges, including mail fraud or, in certain cases, wire fraud.

Interstate And Foreign Travel Or Transportation In Aid Of Racketeering Enterprises

An additional tool in federal prosecutors’ toolboxes is Title 18 U.S.C. Section 1952, also known as the Travel Act, which prohibits using U.S. mail or interstate or foreign travel to commit certain criminal acts. In short, the Travel Act bars the distribution of proceeds of any unlawful activity or the promotion, management, establishment, carrying on or facilitation of any unlawful activity. But, of course, this begs the question: What is an “unlawful activity?” Essentially, an “unlawful activity” is any business enterprise involving gambling. This definition includes owners/operators of a gambling business and bettors. Violators of the Travel Act could face up to five years in prison and a $250,000 fine.

Conducting An Illegal Gambling Business

This provision makes it a crime for anyone to conduct, finance, manage, supervise, direct or own all or part of an illegal gambling business. An “illegal gambling business” violates the law of the state in which it occurs, involves more than five persons, remains in continuous operation for over 30 days and generates $2,000 in gross revenue in any single day. Further, “gambling” includes things like pool-selling; bookmaking; slot machine maintenance; roulette wheels or dice tables; lottery games such as policy and bolita; or the selling of chances. Be mindful that this offense only applies to “offshore” Internet gambling enterprises if the bettor or operation has some connection with a state that prohibits such acts. Offenders of Title 18 U.S.C. Section 1955 can face up to five years in prison and a $250,000 fine. In some cases, prosecutors may also seek to convict on conspiracy charges, even if no crime was committed.

What Is Needed To Convict On RICO Charges?

The Racketeer Influenced and Corrupt Organizations (RICO) Act passed in 1970 to eradicate organized crime in the U.S. Interestingly, RICO includes criminal and civil penalties for racketeering offenses that are part of a criminal enterprise, including money laundering, counterfeiting and embezzlement. In addition, gambling crimes qualify as offenses under the RICO statutes.

To support a conviction, the government must show that:

  • An enterprise that affected interstate or foreign commerce existed.
  • The defendant participated in and was a member of the said enterprise.
  • The defendant committed at least two instances of racketeering activity.

Violations of the RICO statute come with a possible 20-year prison sentence and a $250,000 fine.

Prohibition On Acceptance Of Any Financial Instrument For Unlawful Internet Gambling

In 2006, congress sought to impose strict measures aimed at internet gambling by passing the Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA). Under UIGEA, it is a crime for any gambling business to knowingly accept payment from a person for a bet or wager placed on the internet. In addition, internet payment forms are restricted to credit cards and include electronic funds transfers, checks and other forms of payment.

UIGEA offenders can face up to five years in federal prison.

Money Laundering In Connection To Gambling

Money laundering occurs when someone makes large amounts of money (also known as “dirty money”) from criminal activity and then attempts to hide or conceal the funds’ source, amount or destination. The point of concealing the true origins of the money is to make it appear to authorities that the money came from lawful sources. For example, in the context of gambling, money laundering perpetrators would look to conceal their gambling proceeds to avoid the attention of authorities.

One facing a money laundering charge risks a lengthy federal prison sentence and the need to pay significant amounts of money in restitution. A conviction under Title 18 U.S.C Section 1856 comes with a possible prison term of 20 years and/or a fine of up to $500,000 or twice the value of the money that was laundered, whichever is greater. A conviction under Title 18 U.S.C. Section 1957 carries a sentence of up to 10 years in federal prison.

Importance Of Qualified Legal Counsel

If you or someone you know is facing a federal gambling offense as well as the possibility of prison time and financial penalties, hiring legal counsel is essential.

As a former federal and state prosecutor, I have a profound understanding of the ins and outs of criminal defense. If you engage with defense counsel during the early stages of the investigation, you will have more leverage in preparing your defense.

Seek Counsel For Gambling Charges As Soon As Possible

When I take you on as a client, yours becomes the most important case I have. I understand what is at stake and what must be done to provide an effective defense and a favorable outcome. Call the Law Offices of Peter Katz at 609-900-2648 or contact my firm online to begin preparing your defense today. I serve clients in New York and New Jersey.