Cardroom and online poker are both hugely popular in California, with the number of Californians playing poker online outstripping any other state in the US. Will we soon see online casinos in California go live?
Here’s our rundown of the legal situation and what legislation could mean for online gambling in the state.Jump to
Is Online Gambling Legal in California?
With a couple of exceptions, online gambling is not yet legal in the state of California. Parimutuel bettors can place online wagers on horse races using advance-deposit betting providers. Also, a small legal loophole enables poker players to effectively play for real money. California allows sweepstakes-based poker sites to operate.
These sites use virtual currencies that theoretically has no value. However, this virtual currency is available in packages that contain tickets into sweepstakes ring games and tournaments. Players may also redeem them for real money.
You will notice the use of terms like “not yet legal” and “hasn’t been legalized” as opposed to “illegal” and “prohibited” when referring to online gambling in California. In reality, Californians who play at online casinos aren’t doing anything illegal and they aren’t charged with an offense if they are caught. Online gambling in the Golden State is not a crime. It’s just that Californians who gamble online don’t have any real player protection.
In short, many Californians partake in online gambling without compunction or fear of reprisal from authorities. Keep in mind that just because an offshore internet casino isn’t regulated in California or the United States doesn’t mean it isn’t regulated at all. Any remotely reputable site is regulated and licensed somewhere.
As an aside, failing to declare any online casino winnings is one thing that will land Californians in hot water with authorities.
Online Gambling in the USA
American sports bettors absorbed a harsh blow with the passing of the Professional and Amateur Sports Protection Act, or PASPA, in 1992. The act essentially banned sports betting across the country with just a few exceptions. Montana, Delaware, and Oregon retained the right to conduct sports lotteries, and it allowed Nevada to continue operating licensed sportsbooks.
In 2010, New Jersey governor Chris Christie spearheaded a campaign aimed at having the act overturned. After eight years of legal wrangling and against all odds, the Supreme Court struck down PASPA in May 2018. This means individual states have the power to decide whether or not to allow legal sports betting.
One year later the Garden State was quick to legalize sports betting. Many other states soon followed. Illinois, Indiana, Iowa, Montana, New York, Tennessee, and Washington have all recently enacted legislation and will offer sports betting by the end of 2019. Physical sportsbooks and casinos operate in Delaware, Rhode Island, and on Tribal land in New Mexico.
Mississippi, Nevada, New Jersey, Pennsylvania, and West Virginia all have land-based sportsbooks as well as legalized online and mobile betting. Moreover, New Jersey also has legal online casinos as well as Pennsylvania.
It’s almost a foregone conclusion that New Hampshire, Oregon, Arkansas, and Maine will also have legalized sports betting in the very near future. Several other states including Massachusetts, Michigan, and Ohio appear to be heading in the same direction.
California Casino Laws
Californians have a few options for legal gambling. Once again, parimutuel horse betting and sweepstakes poker sites are two of them. Poker players can also legally play at one of the dozens of licensed land-based card rooms that operate throughout the state.
The California State Lottery offers draws and scratchcards along with access to multi-state lotteries like Mega Millions and Powerball. The state even permits charitable and non-profit organizations to run bingo games and raffles.
At this point, it would be easy to believe the state doesn’t have any casinos in it. Well, it does. As of June 2019, there was a total of 63 casinos in California. 61 Native American tribes own and operate these casinos on their own land. The Pechanga Resort and Casino, which is located in Temecula, houses the largest gaming floor in California.
Totaling 188,000 square feet in size, Pechanga boasts over 4,000 slots. As well as more than 150 table games, a poker room, and a bingo hall that seats 700 people. It offers several restaurants, a 1,085-room hotel, a variety of top-notch entertainment, and loads of other amenities. This casino rivals many Las Vegas casino resorts and other world-class gambling establishments.
So, why do California casino laws only allow casinos to operate on tribal lands? In layman’s terms, these tribes are more or less sovereign and have exclusive rights to casino gambling within California and a few other states through the Indian Gaming Regulatory Act of 1988.
There are over 450 Native American gambling establishments scattered throughout the United States. With enormous sums of money at stake, it’s easy to see why tribes aren’t too keen on the idea of renegotiating their deals and sharing such a lucrative market. The California Nations Indian Gaming Association vehemently opposes expanding gambling in the state.
A reputation for poker
California has a world-famous reputation for poker, arguably even more so than its neighbor Nevada, so it’s surprising that the game hasn’t been legalized there for online play already.
The state plays host to several major tournaments every year, including the California State Poker Championship, and many of the game’s biggest stars are residents. The most historic moment in the state’s poker history so far was Antonio Esfandiari’s record-breaking win of $18,346,673 at the 2012 Big One for One Drop.
As the US’ home of poker, it’s only a matter of time until the law on online gambling in California catches up with the state of play.
Regulating the industry could in fact bring a possible $200m of tax to the state given that online poker is popular regardless of the law.
Several bills have been introduced in favor of legalizing online poker in California so far. But as such a lucrative industry, who should be in control of its regulation?
The AB 167 California Online Poker Bill says that:
- Card clubs, Indian tribes, and racetracks could offer online poker sites;
- Taxes of 8.5% would be taken from licensing fees;
- Operators would pay a $10,000,000 one-time licensing fee.
The AB 9 Internet Poker Consumer Protection Bill proposes:
- Card clubs and tribes could offer online poker
- First deposits would have to be made in person and thereafter electronically;
- An Internet Poker Fund would be established to collect taxes and fees from offshore sites.
The AB 431 Bill also followed, but the details of the proposal are as yet unknown.
The main problem that divides votes is the criteria for eligibility as a licensed poker operator.
California Gambling Control Commission
The California Gambling Control Commission is the official regulator of all online and offline gambling in the state.
The commission remains very involved with the regulation of tribal casinos in the state as well as overseeing the licensing of all card clubs and casinos in the state. The commission’s website provides thorough information on the laws and regulations of online gambling for residents seeking advice.
Are There Online Casinos in California?
Like several other American states, California allows Native American tribes to operate casinos. However, this does not extend to online or mobile casinos. Aside from parimutuel betting and sweepstakes poker sites, there are no online casinos operating within the state’s boundaries. Of course, that doesn’t include any illegal sites. Yes, “illegal”.
It might not be a crime for Californians to gamble online. Yet anyone operating an online casino inside the state is definitely breaking the law and subject to prosecution.
Until California overcomes the obstacles in their way, online gambling will remain unregulated and online gambling licenses can’t be issued. Naturally, this means no online casinos will be able to legally operate in California for some time.
What to Expect Once Online Casinos are Legal in California
There is a reason for guarded optimism among the Golden State’s sports betting community and fans of online casinos. In recent years, California has taken a few baby steps towards regulating the industry. Several bills have made their way into California’s State Assembly. Unfortunately, they have been met with fierce resistance and failed to succeed.
Proponents can anticipate sustained opposition from anti-gambling groups and Native American tribes among others. This is nothing new. States in which legalized online gambling exists or is close to coming into effect have faced and overcome strong opposition.
When, not if online gambling becomes a reality in California, it’s reasonable to expect it will be done right. Thanks to the diligent legwork done by lawmakers and regulators in other states, California has a number of models to draw from. They can also copy other respected international gambling jurisdictions like the United Kingdom, Malta, and the Kahnawake Gaming Commission to the north.
Several years ago, California made several gambling games illegal. Those included Roulette, Monte, and Twenty-One along with any percentage or banking games involving dice or cards. Californians can look forward to seeing that law scrapped in order to accommodate online and possibly non-Native casinos. Californians can expect American entertainment and gambling giants like Caesars and MGM play a pivotal role in getting the industry off the ground. International players like 888, Bet365, and William Hill to be right beside them.
It’s reasonable to assume the state will follow other states like New Jersey by limiting the number of remote gambling licenses. There’s a fine line between healthy competition and over-saturation. However, we can expect California to take a careful approach to legalize and regulate online casinos and sports betting.
Not only that, it isn’t a stretch to include regulated online poker in the mix. It’s hard to say whether eSports betting will be embraced by legislators but there is a good chance they will. In the past couple of years, eSports has been the fastest-growing segment in the gambling industry.
Possible Bookmakers in CA
Taking a look at some states that now have legalized online gambling and sports betting, it’s a near certainty that Californians will see many of those very same operators.
Names like Golden Nugget, Caesars, SugarHouse, and Tropicana will lead the way in online casinos while international operators like 888, William Hill, and Unibet will be at the forefront of the sports betting scene. Of course, DraftKings and FanDuel will be right up there too. Throw in poker luminaries like Party Poker and Stars Casino by PokerStars, and California will have a formidable and immensely profitable online gambling industry.
Casino Apps in CA
Mobile betting is an integral component of any modern online gambling operation be it online casino gaming, poker, or sports betting. In fact, if it wasn’t for mobile betting, sportsbooks wouldn’t be experiencing such rapid growth in live betting. From a technological standpoint, it should be rather easy for California to adopt mobile betting and betting apps.
By the time the Golden State finally adopts online betting, several operators will have betting apps up and running in other states making things much simpler for California to follow suit. Like online gambling and sports betting, it seems to be a matter of when and not if mobile betting apps come to California.
Our Prediction on the future of Casinos in California
Unlike legalizing sports betting and California online casinos, it’s hard to see any changes in the status quo as far as land-based casinos off of tribal lands is concerned. At least for the foreseeable future. It is an entirely different beast and one that will take much longer to slay. Also, unlike online casinos and sports betting, there isn’t nearly as much interest or support in building more brick and mortar casinos as there is in the online gambling issue.
While launching online gambling platforms in California will be a relatively quick process, conducting a referendum, drafting, and then passing new legislation won’t be. Especially when the state doesn’t appear to be in any rush to do it. It would be nothing short of a miracle if Californians were legally betting on sports and playing at online casinos within the next two years. Nevertheless, online gambling’s future in California looks many shades brighter than it did prior to PASPA being overturned. Be patient. It’s coming.