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New Jersey Challenges Wire Act Ruling

Paper Pusher

Senior officials in the state of New Jersey are challenging a recent ruling by the Trump Administration that threatens the thriving online casino gambling industry in the state.

Since the federal government authorised online casino gambling in New Jersey eight years ago, the industry has become a $350 million business, providing employment for thousands of people in the state, as well generating considerable tax revenue for state coffers.

But last month, the US Department of Justice (DoJ) issued a new opinion, effectively outlawing online casino gambling and reversing an earlier position taken by the DoJ under the Obama administration. In 2011, the DoJ had ruled that the Wire Act, which effectively bans online sports betting did not apply to online casino gambling, opening the door for New Jersey online casino operators.

The reversal of that opinion by the DoJ in January was criticised by many gambling industry groups and others, and now New Jersey state officials have challenged it. In a joint letter to the Acting US Attorney General Matthew Whitaker, the New Jersey Attorney General Gurbir Grebal and the Pennsylvania Attorney General Josh Shapiro have set out their concerns, and asked the DoJ to offer guarantees that the existing online casino gambling industry would not be affected:

We ask that DOJ withdraw its opinion altogether or assure us that DOJ will not bring any enforcement actions against companies and individuals engaged in online gaming in our states — where it is appropriate under state law.”

Grewal has also made an official Freedom of Information Act request, as part of an attempt to find out who officials at the Justice Department spoke to in reaching the decision. The DoJ has yet to respond to the comments, although new Senate Judiciary Committee Chairman Lindsey Graham has praised the new ruling, saying that it reversed what he described as a ‘failed Obama policy’.

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