Hi tssbish:
Every state has different rules with regards to what legally
constitutes "gambling". However, most follow the basic tenet of:
"The classic legal definition of gambling is any activity that
involves three things: consideration (i.e., a cash bet), chance, and a
prize."
From: http://www.chron.com/cgi-bin/auth/story/content/chronicle/ae/books/9899/11/15/badbetch1.html
From what you've mentioned of your idea, you definitely have the first
(bets) and third (a prize) elements. Is there *any* element of chance
in your online game? If so, I'm afraid that you fall under the
definition of gambling and will likely have to operate offshore.
The whole idea of trying to avoid the last element (a prize) by
issuing "credits" has been tried before and most states have closed
that loophole quite effectively. For more information on this see:
Video Gambling Devices
URL: http://www2.tltc.ttu.edu/Cochran/Gaming%20Law/rychlakvideo.htm
Quote: "In one early attempt to avoid the reach of gambling statutes,
machines were modified so as to dispense tokens, rather than cash to a
successful player.24 The tokens could then be exchanged for cash. Such
machines, however, were soon outlawed in most states. Another early
tactic was to dispense a small mint candy or piece of chewing gum each
time the gambling machine was played. Use of the candy, it was argued,
effectively converted a slot machine into a legitimate vending machine
because the player received some consideration for each coin.26 Other
variations included machines that paid off in cigars, golf balls, and,
during World War II, ration tokens."
The following website gives some very good information about the legal
implications of online gambling in the U.S. in general:
Internet/Online Gambling Questions
URL: http://www.wsgc.wa.gov/FAQ/InternetGamblingFAQ.htm
Quotes:
"Is online gambling legal in Washington State? No. State law
prohibits the transmission or receipt of any wager or gambling
information intended to be used for bookmaking or other unauthorized
gambling activity. It is also illegal under federal law, including
the Federal Wire Wager Act (18 U.S.C. § 1084 (1994), to operate a
betting or wagering business using telephone lines or other 'wire
communication facility.' Federal prosecutors have successfully
prosecuted United States citizens with businesses based offshore under
the Wire Wager Act."
"If online gambling is illegal in the United States and Washington
State, then why do I see them all over the Internet? It is not illegal
to operate an online or Internet gambling website in countries which
permit it and when the people placing those bets are in those
countries; it is illegal, however, to solicit bettors from the United
States, under the federal Wire Wager Act. Also, people in
Washington State who place bets on the Internet can be charged with
Professional Gambling in the Third Degree, which is a gross
misdemeanor."
"Has anyone ever been prosecuted for online gambling? Yes. Jay Cohen
was convicted in February 2000 for violating the Wire Wager Act in
connection with his operation of World Sports Exchange (WSE). Mr.
Cohen was sentenced to 21 months in prison and fined $5,000."
I hope this information has been of help to you.
If you need any clarification of the information I have provided,
please ask using the Clarification feature and provide me with
additional details as to what you are looking for. As well, please
allow me to provide you with clarification(s) *before* you rate this
answer.
Thank you.
websearcher-ga
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