Indiana Prohibits Internet Gambling

With the signing of Senate Act No. 92 by Gov. Mitch Daniels last week, Indiana became the latest U.S. state to enact a law prohibiting gambling over the Internet. If the government enforces the law, Internet service providers will have to begin blocking access to specific gambling Web sites when ordered by the state's attorney general to do so.

Authored by Sen. David Ford, R-Hartford City, the law makes it a Class D felony for anyone to operate a gambling Web site or service in Indiana or to promote such a site or service from within the state. The law provides a schedule for how an Internet gambling operator in Indiana is to be treated. The process entails written notice given by a prosecuting attorney ordering that the service be shut down within 30 days, but in reality, there are no known I-gaming operators in Indiana.

The law also takes into consideration online gambling sites that operate from outside the state but offer services to residents of the state. The law states: "A person outside Indiana who transmits information on a computer network. . . and who knows or should know that the information is broadcast in Indiana submits to the jurisdiction of Indiana courts for prosecution under this section." But it is not likely that the state will actually seek legal action against an online gambling company operating overseas. The more likely event is that the state will begin using other powers provided in the statute to block Indiana citizens from accessing the sites.

Internet service providers can begin blocking access to gambling sites when the law becomes effective on July 1. Those that do not take the initiative to block gambling sites could eventually be required by the attorney general to do so. Ford said the attorney general will begin compiling a list of sites that all Internet service providers will be required to block.

"The major way for the attorney general to update the list is from notices that he may receive from local prosecuting attorneys," Ford said. "The prosecuting attorneys will report sites that they become aware of from law enforcement agencies or from citizen complaints."

Ford added that Internet gambling is a huge problem in Indiana.

"Of course no one knows the whole economic impact, but a report from the General Accounting Office a few years back estimated the activity to account for more than $6 billion," he said. "I would have to think that it would be three or four times that volume by now. The practice is already illegal in Indiana; this bill just tries to find ways to enforce the law.

"Internet gambling is completely unregulated. There is no way to keep minors off of the programs or to insure that the sites are honest either in pay-outs or in control of the data furnished to them."

Ford also said the state's Internet service providers support the law.

"We've been working with all the legitimate companies to see if there are ways to make sure that people who are doing what that are legally entitled to do still can, and the same time take care of those people who are obviously not legal," he said. "So far we've got pretty good cooperation."

It remains to be seen whether any Internet service providers will take the initiative to begin blocking sites, or how studiously the state's prosecutors and attorney general will approach the process of blacklisting sites.

Meanwhile, the new law has received little coverage in the newspapers and broadcast media across the state, meaning that hundreds of thousands of online gamblers in the state may be quite surprised to find themselves suddenly blocked from accessing their favorite sites.

Ford has been introducing slightly different version of his online gambling bill to the Senate for several years. He told IGN four months ago, "Every time the bill has come before the Senate it has passed unanimously for procedural reasons, although last year there was a kind of bloody political fight over all the bills, so a lot of them died. It hasn't really had a final vote in the House yet."

Another Indiana lawmaker, Rep. Jerry Denbo, D-French Lick, had been persistent in authoring I-gaming legislation for several years in the other house of legislature.

Click here to view Indiana Senate Enrolled Act No. 92.