US Online Poker
Atte updated this on Feb 8th, 2014.
Playing US online poker is legal on a federal level. Why? Because there's nothing on a federal level prohibits you from playing at US online poker sites. Some state laws, though, may prohibit you from doing so. (Read state law summaries to learn about your local laws, although contacting a local gaming lawyer is the best thing to do.)
See payment options for US players if you're confused with the lack of banking options. By clicking that link, you'll find all the available ways to deposit money to US poker sites, such as credit cards, Moneygram and Western Union. The rest of this page is dedicated to explaining why the US online poker situation is what it is.
Why US Online Poker Legality Is Confusing
“The DOJ has been waging a war of intimidation against Internet gambling for years, successfully scaring players, operators, payment processors and affiliates into abandoning the American market...” I. Nelson Rose, Gamblingandthelaw.com
Until 2011, many believed that the Wire Act of 1961 made real-money USA online poker illegal, mainly because the Department of Justice claimed that it did, even though the US Fifth Court of Appeals had already ruled otherwise in 2002.
But in November of 2011, the DOJ put that misconception to rest by indirectly changing its stance and admitting that the Wire Act only targets online sports betting.
The "new" stance gave states green light to start legalizing internet poker in the USA within their boundaries and perhaps form compacts with other states. (The DOJ's previous stance had held states back and the DOJ even prevented North Dakota's lawmakers from legalizing online poker back in 2005 by telling them that online poker ”may be” illegal.)
On a side note, Party Gaming's (the parent company of Party Poker) founder pleaded guilty to violating the Wire Act in 2008 and agreed to pay $300 million to settle the case when the DOJ hadn't changed its stance yet - I wonder how he feels about that now. (Then again, Party Poker has since returned to US successfully so maybe it was for the best not take a chance and possibly create more trouble.)
But What About the UIGEA?
The second big misconception is that the Unlawful Internet Gaming Enforcement Act (UIGEA) makes online USA poker illegal.
First of all, the UIGEA never made playing online poker illegal; it made processing "unlawful" online gambling transactions illegal. Secondly, the UIGEA is an enforcement act so you have to break some other federal, state or tribal law to make what you're doing illegal, and since there's no federal law that makes online poker illegal, it's debatable whether online poker payments are even "unlawful."
When PokerStars left the US market and later settled with the DOJ, they forfeited over $700 million in the deal but never admitted any wrongdoing. Even though the DOJ seems to think otherwise, the people at PokerStars (among many others) still believe that online poker transactions are not considered "unlawful" on a federal level, although they may be unlawful in states that have prohibited internet poker.
On a side note, again, Party Gaming left the United States online poker market weeks before the UIGEA was even signed into law, losing tens of millions of dollars in the process. Since they were making 2-3 million dollars a day, they could have just as well kept their games running until UIGEA was signed into law - which usually takes a few weeks at the minimum - before pulling the virtual plug on real-money USA poker.
The UIGEA had a huge effect on the online poker industry, mostly complicating online poker payments. Players still had great rooms to play at with PokerStars and Full Tilt Poker taking the top positions (by traffic) but US players also had significantly less banking options, perhaps the biggest loss being Neteller's US exit.
But What Happened on "Black Friday"?
Three of the biggest US online poker sites were shut down April 15th, 2011 (referred to as Black Friday in the poker community). Those who know little about the facts believe it happened because USA poker online is illegal; in reality, those companies where charged with fraud and money-laundering for violating the UIGEA and the Illegal Gambling Business Act (IGBA).
PokerStars – one of the sites that were shut down – actually settled the case for $731 without admitting any wrongdoing (and acquired the assets of Full Tilt Poker in the process). As explained, claiming that online US poker transactions are "unlawful" on a federal level is plain weird as there seems to be no law that would make internet poker an illegal form of gambling - or even "gambling" at all - based on a federal law.
What's important to note here is that none of these situations have happened because it would be illegal to play USA online poker -- they've all been about operating a gambling business, or rather processing gambling payments.
Will More Sites Get Shut Down?
Bovada Poker is now the biggest USA poker site. Will the DOJ do the same to Bovada as they've done to PokerStars, Full Tilt Poker and Absolute Poker/Ultimate Bet (companies that once had 95% of US internet poker market)?
Anything is possible and Bovada, while operating an internet poker room for which processing payments shouldn't be illegal but it never stopped the DOJ before, is also operating online casino and sportsbook games for US citizens. Now there's no question that casino games are gambling (while poker, as primarily a game of skill, could be categorized as such) and that the Wire Act applies to sports betting (it does not apply to poker). So Bovada is dealing with more in that sense.
Bovada, though, is already operating on a .lv domain (which the US government, to my knowledge, can't seize) and seems to have no interest in becoming one of the sites to offer regulated online poker in the states that have legalized it, which was one of the reasons why PokerStars was willing to settle with the US government.
But Bovada has had their share of problems, like in 2008 when Maryland DOJ and IRS seized $30 million from Bovada's (then Bodog) accounts. That only caused delays in cashouts, but in reality it could happen again and the DOJ may be able to seize much more at that time. (Bovada has since stopped accepting players from Maryland, New York and Washington, obviously seeing them as riskier jurisdictions than others.)
A Word of Caution
Anything can happen. Never leave too much money on your US poker account, because even if a site is shut down and allows you to withdraw your money afterwards, it may take a long time before they'll be able to process the money and send it to you -- could be years, even. So never put so much money on your poker account that you won't survive if you lose it or if you have to wait for it for a long time (Full Tilt's US customers are expected to get their money back on March 31st, 2014, almost three years after they were restricted from playing on the site).
It may be legal for you to play but if the site you're playing at gets into legal trouble, you may lose your money, no matter how unfair it sounds.
The safest US poker sites to play at are the ones that have been licensed to operate in states with legal and regulated online poker. So far, Delaware, Nevada and New Jersey belong to that group, but hopefully we'll see others like California and Pennsylvania join that group soon. With that said, the playing experience so far has been subpar at those sites with all the geolocation and deposit problems.
Bovada.lv is the best choice outside of licensed US sites simply because of its experience of 15+ years in the online gambling business, highest player traffic and fastest cashouts out of of all US poker sites, which is a definite sign of reliability.
Note: I'm not a lawyer, have never studied law and write only for entertainment purposes. I take no responsibility for the accuracy of information on this site - I've done research, but I may be wrong. I recommend contacting a local gaming lawyer to find out if online poker is legal where you live.