Why is US poker legal in casinos but not online?

I've read a lot of conflicting arguments online in regards to US players. Some people have said it's illegal to play, others say it's only illegal to deposit money, and other says that if you do successfully deposit then you're illegally laundering money. I'd really just like to get to the bottom of it.

In regards to the money laundering, and furthermore, taxation of it, wouldn't it just make sense for a company to launch an American online site for only American players, give the government a cut of the rake and solve the problem. I mean, most state casinos, like the one near where I live are a huge contributor to government projects and they pay huge taxes - so it would seem like it's a no brainer. I can go to the local casino and deposit money using my debit card, what's the difference in doing that same thing online?

I can risk money "gambling" in the stock market and that's legal, but I can't "gamble" on a set of cards that also has preferable odds of being financially beneficial. Lastly, if it's the fact that the government simply doesn't want us to deposit money online, couldn't online casinos simply charge for a product not related to gambling, like purchasing a smiley or an article, something that doesn't actually have to be shipped, but then fund the players account?

It's not Money laundering unless you're doing something like this. It is stolen money or from drug sales, ie you have not paid any tax on it. http://en.wikipedia.org/wiki/Money_laundering

Bulk cash smuggling: Physically smuggling cash to another jurisdiction, where it will be deposited in a financial institution, such as an offshore bank, with greater bank secrecy or less rigorous money laundering enforcement.

Round-tripping: Money is deposited in a controlled foreign corporation offshore, preferably in a Tax haven where minimal records are kept, and then shipped back as a Foreign Direct Investment, exempt from taxation.

Casinos: An individual will walk in to a casino with cash and buy chips, play for a while and then cash in his or her chips, for which he or she will be issued a check. The money launderer will then be able to deposit the check into his or her bank account, and claim it as gambling winnings.

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Any big cash or check deposited into your checking/savings account will put up a Red flag, you're bank will report you to the FBI or IRS.

???

So if you get a check from Let's say Bovada, your going to get reported to the FBI? Why couldnt you just claim it on your taxes as gambling winnings?

ibsiegel said:

So if you get a check from Let's say Bovada, your going to get reported to the FBI? Why couldnt you just claim it on your taxes as gambling winnings?

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We'er talking 10K to 20K deposits in one go. As long as you claim taxes on it and are not hiding the money as something else, it's not Money laundering.
I cashed out from PS, it showed up in my account coming from PS.

I think the money laundering argument is a crock. It's just an excuse for them to seize /take money from sites and payment processors. It's a lot easier to launder money from a porn website overseas. Nobody bothers with them. On a poker site your pay rake an unnecessary expense just to launder ill gotten gains.

kltpzyxMrM said:

I think the money laundering argument is a crock. It's just an excuse for them to seize /take money from sites and payment processors. It's a lot easier to launder money from a porn website overseas. Nobody bothers with them. On a poker site your pay rake an unnecessary expense just to launder ill gotten gains.

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Yea it may be easier to launder money for the OWNERS of a porn site but not for customers... any person can launder money using a poker site.. having that said theres a million different ways to launder money.. A regular casino is just as easy to do it.. I think it would be alot easier for them to detect if they had it regulated and done through bank accounts as they would have records of ALL money transactions.. its just all dumb

I read something that the reason for not legalizing online gambling is that they are trying to protect those with no will power to resist the urge to try and hit it big. They figure that anyone at anytime can deposit there life savings in the hopes to win the big game or whatever. I personally think that they just want control. It is a power thing with the government and they want to be able to tell us what we can and can't do. This is why I question that we are a free country because in my lifetime I haven't had much success getting anything for free.

All very confusing.. I hope they get this all regulated soon, then maybe we can go back to huge games for pocket change like poker stars had many moons ago. Bet when they finally do though it might not be worth playing because they will tax it like lotto. Great world we live in, when you work for the government.

I just don't understand why there couldn't be a legitimate U.S. online casino, even one that was only open to players with U.S. bank accounts or IP addresses. For the people that really want to get money onto sites, there isn't anything truly stopping them right now - there's loop holes everywhere. So rather than force players into loop holes and trying to get around the government, it just seems much more beneficial that there be a site that works with the government.

I'm not saying that they should be able to just access whatever information they want, whenever they want - people should have a right to privacy - but at the very least, you'd be ensuring the government is getting their taxes, money is staying within the U.S., and that there is a U.S. entity behind the scenes willing to work with the U.S. government for a win-win-win.

In regards to the money laundering, and furthermore, taxation of it, wouldn't it just make sense for a company to launch an American online site for only American players, give the government a cut of the rake and solve the problem. I mean, most state casinos, like the one near where I live are a huge contributor to government projects and they pay huge taxes - so it would seem like it's a no brainer. I can go to the local casino and deposit money using my debit card, what's the difference in doing that same thing online?

All Oklahoma casinos are Indian owned, nobody else is allowed to run one. I think the gubment made a deal with them under the table, 'you can run casinos, just don't sue us for the land we stole'.

luckyhearts said:

All Oklahoma casinos are Indian owned, nobody else is allowed to run one. I think the gubment made a deal with them under the table, 'you can run casinos, just don't sue us for the land we stole'.

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This is because most indian tribes have reservations that are federally protected.. This gives them the freedom to run casinos and other things without worrying about state gambling laws

casino lobbyists

Probably brick and mortar casino lobbyists dont want the competition.

It is not illegal to play online, it is just illegal to use US banks to put money on or take it off sites. (under that money laundering crap law)

The IRS does not care how or where you get your money as long as you pay taxes on that said money. I reported all the winnings from my PS days and never had a problem. Hiding money and not paying taxes is laundering money.

Online sites in US

What's the difference in legal casinos and legal online sites? I don't see a problem if it is legally sited.

ibsiegel said:

So if you get a check from Let's say Bovada, your going to get reported to the FBI? Why couldnt you just claim it on your taxes as gambling winnings?

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The FBI or I R S isn't going to do anything as long as you pay your taxes.