{"id":96408,"date":"2019-01-17T18:10:00","date_gmt":"2019-01-18T02:10:00","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=96408"},"modified":"2019-01-18T09:25:21","modified_gmt":"2019-01-18T17:25:21","slug":"%ef%bb%bffederal-prosecutors-may-find-it-difficult-to-use-wire-act-to-shut-down-online-gambling-experts-weigh-in","status":"publish","type":"post","link":"https:\/\/www.casino.org\/news\/%ef%bb%bffederal-prosecutors-may-find-it-difficult-to-use-wire-act-to-shut-down-online-gambling-experts-weigh-in\/","title":{"rendered":"Federal Prosecutors May Find It Difficult to Use Wire Act to Shut Down Online Gambling: Experts Weigh In"},"content":{"rendered":"\n

A new opinion from the Justice Department (DOJ) — which largely reverts to its original status the interpretation of the Wire Act<\/a> — faces many obstacles before federal prosecutors can push to shut down online gambling websites or interstate lotteries.<\/p>\n\n\n\n

\"\"
The uncertain impact that the Nov. 2, 2018 revised Wire Act opinion may have on online gambling is open to interpretation, based on several experts Casino.org spoke to this week. (Image: Open Sense Labs)<\/figcaption><\/figure><\/div>\n\n\n\n

For starters, the DOJ will have to update its prosecution manual to include the newly revised opinion<\/a> that was handed down on Nov. 2, 2018, but just released earlier this week. <\/p>\n\n\n\n

Revised guidance can certainly be provided within 90 days,<\/strong>\u201d Laurel Loomis Rimon — an attorney at O’Melveny & Myers, who formerly was a supervisor in the DOJ\u2019s Criminal Division — told Casino.org<\/em> on Thursday.<\/p><\/blockquote>\n\n\n\n

Prosecutors know that the 90-day grace period announced this week could be extended further, delaying any legal action.<\/p>\n\n\n\n

Also, the Organized Crime and Gang Section (OCGS) could \u201csimply hold prosecutors from bringing the charges for a longer period if there is a feeling that 90 days is really not enough time to allow reasonable efforts to come into compliance with the law in any particular case,\u201d  Rimon said.<\/p>\n\n\n\n

The OCGS within the DOJ’s Criminal Division was established in late 2010 as a merger of the (former) Organized Crime and Racketeering Section (OCRS), Gang Unit, and the National Gang Targeting Enforcement & Coordination Center (GangTECC). The new, combined OCGS pursues a multi-faceted approach to combating all forms of organized crime targets, although no industry experts who deal with legal online gambling would ever confuse the two factions.<\/p>\n\n\n\n

Federal Judges May Reject DOJ Opinion<\/h2>\n\n\n\n

But\neven if the DOJ initiates an enforcement action based on the new opinion, \u201cit\nis not binding on the federal courts,\u201d Rimon said. <\/p>\n\n\n\n

That means a federal judge could throw the case out of court simply because he or she disagreed with the new opinion.<\/p>\n\n\n\n

Some federal appeals courts already have held the Wire Act doesn\u2019t apply to non-sports gambling. In fact, Anthony Cabot, a veteran gaming law attorney who now teaches at UNLV’s law school, points out that, \u201cThe only circuit court cases (1st and 5th circuit) on this topic side with the 2011 [previously revised Wire Act] opinion.<\/p>\n\n\n\n

\u201cSo, as a matter of law, I am not sure anything will necessarily happen without further litigation, which I believe will ultimately be decided along the reasoning of the 2011 opinion and the circuit court decisions,\u201d Cabot said in a statement released by the university.<\/p>\n\n\n\n

Similarly, Daniel Wallach, co-founding director of the University of New Hampshire School of Law Sports Wagering & Integrity Program, told Casino.org<\/em> that a federal judge typically \u201clooks to precedent to interpret the law\u201d and would more likely follow the interpretation of an appeals court judge than an advisory opinion from a federal agency or department — such as the DOJ — \u201cwhich may be infected by the political process.\u201d<\/strong><\/p>\n\n\n\n

Preemptive\nAction Could Be Filed Soon<\/strong><\/h2>\n\n\n\n

Wallach also predicts that impacted parties — such as Delaware, New Jersey, or Nevada — along with online poker sites, could bring a preemptive action in federal court soon, well before any prosecution even has a chance to take place.<\/p>\n\n\n\n

These \u201cmost likely plaintiffs\u201d could argue they face \u201cimminent harm\u201d from the new advisory opinion and seek a preliminary injunction, temporary restraining order and\/or file a lawsuit, Wallach said.<\/strong><\/p>\n\n\n\n

He also points out that a current \u201csafe harbor\u201d\nmeans that any online activity between the 2011 opinion on the Wire Act and 90\ndays after the latest opinion, \u201cwon\u2019t form the basis of [a] prosecution.\u201d<\/p>\n\n\n\n

Moreover, Rimon points out that the DOJ often resolves legal issues \u201cshort of enforcement actions through negotiated settlements.\u201d Also, gambling operators have the option to \u201cvoluntarily change or close operations that could be subject to enforcement action,\u201d she adds.<\/p>\n\n\n\n

Just to get an idea of whether gambling or online crime is a priority of the Justice Department, Rimon noted that gambling is not mentioned in the DOJ\u2019s 2018-2022 Strategic Plan. Nor is online crime a specific focus, she adds.<\/strong><\/p>\n\n\n\n

But\nthat does not mean gambling sites should ignore the advisory opinion.<\/p>\n\n\n\n

\u201cGambling operators who have developed interstate operations will need to review their platforms and business models to determine what aspects of the operations are impacted by the position that [the] DOJ is now taking and determine whether they will continue operating as they are, while weighing the risk of DOJ enforcement action, their willingness to challenge the DOJ\u2019s interpretation, or the benefits of curtailing their operations to remain solely intrastate,\u201d Rimon said. <\/p>\n\n\n\n

She points out too that, typically, prosecutors often select cases \u201cwith a substantial volume of fraud or consumer harm.\u201d An online gaming entity that is \u201clegal\u201d under the Wire Act could still be prosecuted if it was separately facilitating fraud, money laundering, or other illegal activity, according to Rimon.<\/p>\n\n\n\n

Wire Act Opinion vs. DOJ Enforcement: What’s the Difference?<\/strong><\/p>\n\n\n\n

When Assistant Attorney General Steven Engel released an updated interpretation of the Wire Act this week — leading to the DOJ potential prohibition on online gambling — he did it through an \u201copinion.\u201d But there are differences between the broader opinion, and a specific enforcement action from the DOJ\u2019s Office of Legal Counsel (OLC).<\/em><\/p>\n\n\n\n

\u201cAn OLC opinion is a legal interpretation that guides [the] DOJ in determining whether to consider certain activity as illegal or not,\u201d explains Laurel Loomis Rimon, an attorney at O’Melveny & Myers, who formerly was a supervisor in the DOJ\u2019s Criminal Division. \u201cThe opinion itself does not result in action against any particular individual or entity.<\/em><\/p>\n\n\n\n

\u201cAn enforcement action, which may refer to a criminal investigation or indictment, or a civil lawsuit brought by main DOJ prosecutors or a US Attorney\u2019s Office, requires specific proof of a violation of law by specific individuals or entities, and the bringing of charging documents or a civil complaint in a federal district court,\u201d she adds.<\/em><\/p>\n\n\n\n

On the other hand, an advisory opinion is just that — \u201can advisory opinion to provide guidance to prosecutors,\u201d says Daniel Wallach, co-founding director of the University of New Hampshire School of Law Sports Wagering & Integrity Program.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

A new opinion from the Justice Department (DOJ) — which largely reverts to its original status the interpretation of the Wire Act — faces many obstacles before federal prosecutors can push to shut down online gambling websites or interstate lotteries. For starters, the DOJ will have to update its prosecution manual to include the newly […]<\/p>\n","protected":false},"author":44,"featured_media":96432,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[19,60,13699,61,1074],"tags":[],"acf":[],"yoast_head":"\nFeds May Find It Difficult to Use Wire Act to Shut Down Online Gambling: Experts Talk<\/title>\n<meta name=\"description\" content=\"Casino.org spoke with several highly informed legal experts about the possible implications of the newly released Wire Act reversal and how it could - or could not - be implemented.\" \/>\n<meta name=\"robots\" content=\"noindex, follow\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Feds May Find It Difficult to Use Wire Act to Shut Down Online Gambling: Experts Talk\" \/>\n<meta property=\"og:description\" content=\"Casino.org spoke with several highly informed legal experts about the possible implications of the newly released Wire Act reversal and how it could - 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