Online Casino History

The History of Online Casinos can be traced back to the mid 1990's when an Isle of Man company called Microgaming developed the first form of internet gambling software. Microgaming partnered with CryptoLogic to ensure that all financial transactions were secure and the age of internet gambling was born.

In 1994 Antigua and Barbuda introduced the Free Trade & Processing Act, allowing gaming licences to be supplied to organisations applying to open online casinos. The cost of these licenses was approximately 100,000 US dollars per year.

In 1996, Boss Media was founded in Vaxjo, Sweden with the initial corporate aim to operate Gold Club Casino, which it launched in 1997. Soon after the online casino was launched, Bossmedia launched as a casino news portal and the company started receiving requests from investors and companies interested in purchasing Boss Media's casino software as a white label. Boss Media's main focus thereby transferred to the creation of complete white label Internet casino solution for clients and began to sell licenses at around 300,000 US dollars plus a revenue share.

Boss Media was a dominant player in the global online casino software market alongside Microgaming, CryptoLogic and later Playtech amongst others.

During the boom in US online gambling prior to its US ban in 2004, Boss Media was supporting some 32 or more licensees with its software.

In 1996 the Kahnawake Gaming Commission, which regulated online gaming activity from the Mohawk Territory of Kahnawake expanded its business activities and started offering gaming licences to new online casinos.

Whilst still an industry in its infacy with only 15 casino websites online in 1996, by 1997 the amount of casino websites had grown to more than 200 and by 1998 online casino revenues had grown to more than $800 million anually.

2000 saw the first Australian Federal Government pass the Interactive Gambling Moratorium Act (IGA), making it illegal for any online casino not licensed and operating before May 2000 to operate. This new legislation meant that Lasseter's Online which was established in 1999 and operated 3 casino brands including Lasseters Online, AusVegas and Lasseters Euro, became the only online casino able to legally operate in Australia.

However due to the new Interactive Gambling Moratorium Act, Lasseter's cannot take bets from Australian citizens. After making loses of more than $15 million in 2007, Lasseters Online effectively went bust and was closed down by its parent company, Lasseters International.

The United States Court of Appeals for the Fifth Circuit ruled in November 2002 that the Federal Wire Act prohibits electronic transmission of information for sports betting across telecommunications lines but affirmed a lower court ruling that the Wire Act "in plain language does not prohibit Internet gambling on a game of chance."

While some states have specific laws prohibiting online gambling, many do not. Additionally, in order for an online gaming company to start, a license from the state is required. The only state to ever issue a license was Nevada, in March 2013.

In September 2006, just before adjourning for the midterm elections, both the House of Representatives and Senate passed the Unlawful Internet Gambling Enforcement Act (UIGEA) of 2006 (as a section of the unrelated SAFE Port Act) to make transactions from banks or similar institutions to online gambling sites illegal in the USA. The passed bill only addressed banking issues and the Act was signed into law on October 13, 2006, by President George W. Bush.

At the UIGEA bill-signing ceremony, Bush did not mention the Internet gambling measure, which was supported by the National Football League but opposed by banking groups. The regulation in the UIGEA was issued in November 2008.

In May 2009, Congressman Barney Frank introduced a bill to overturn the gambling aspects of the Act, "The Internet Gambling Regulation, Consumer Protection, and Enforcement Act", which seeks to repeal the major online gaming obstacles of the UIGEA and go further in protecting Americans from fraud, while safeguarding against underage and problem gamblers

It was commonly assumed that the Federal Wire Act prohibited all forms of online gambling in the USA.

In December 2011, the United States Department of Justice released a statement clarifying that the Wire Act applied only to sports betting sites and not to online casinos, poker, or lottery sites, leaving the definition of legality up to individual states. Certain states such as Nevada, Delaware, and New Jersey have started the process of legalising and regulating online gambling and it is expected that regulation will continue on a state by state basis.