30-second summary:
- New Wire Act opinion by Trump Administration places New Hampshire Lottery profits at risk
- Officials ready to file lawsuit if necessary to protect the $5m a year they earn via the lottery
- New opinion deems purchasing lottery tickets online in New Hampshire illegal, harming the profitable business the state offers
- Could create huge revenue losses, as much as $8m annually
Lottery officials across the nation are worried about a decision by the United States Department of Justice involving the 1961 Wire Act. In New Hampshire, lottery officials are not happy with the changes and are ready to take action.
The new opinion of the Wire Act now expands the federal government’s view involving interstate online wagering. The lottery and interstate online poker gaming are now at risk.
Interstate iGaming banned
The guidance by the DOJ involving the Wire Act has expanded to place all interstate online gambling in violation of the law. In the past, the Wire Act only included interstate sports betting. This allowed several states to set up online lottery gaming. Online poker offerings are also in the mix when it comes to interstate play.
In New Hampshire, at least $5m a year in lottery profits is at risk, based on the new ruling. Officials in the state are ready to file a lawsuit if needed to protect the lottery revenues. The money generated from the lottery goes to fund local schools. The state stands to lose a great deal based on the new ruling.
Lottery executive director Charles McIntyre said: “Certainly at the very narrowest interpretation we are looking at $4m to $6m this year and $6m to $8m next year, as this represents what we are selling now through the internet channel.”
Strong opposition
New Hampshire began selling online lottery products in September 2018. It became the sixth state to offer online lottery gaming and has seen great success. Profitability is now at over $300,000 a month.
Because of this success, the recent opinion by the DOJ involving the Wire Act came as a shock. The decision overturns the 2011 guidance during the Obama Administration, which included only interstate sports betting as a violation.
The state has other allies in its opposition of the ruling. The North American Association of State and Provincial Lotteries has come out against the decision as well. The group stated the opinion is bad for the industry. The group not only includes lotteries in the US, but also in Canada.
Others are rallying against the new opinion as well. According to VSO News, the attorneys general of Pennsylvania and New Jersey sent a letter to the US Attorney General regarding the new opinion. Both New Jersey AG Gurbir Grewal and Pennsylvania AG Josh Shapiro are in opposition.
Grewal has even filed a Freedom of Information request to learn more about how the change came to pass. He has requested to have access to information regarding communications that involved Sheldon Adelson, a strong opponent of online gambling, as well as other lobbyists and the DOJ. It is believed that lobbying efforts by Adelson and others helped push the DOJ to make the Wire Act change.
Possible legal action
New Hampshire’s lottery executive McIntyre has been preparing for legal action involving the Wire Act decision. He has spoken to Governor Chris Sununu as well as Attorney General Gordon J. MacDonald.
According to McIntyre, the threat is serious enough to a major source of revenue for the state, that he wanted other officials to be aware. Discussions can then be had as to what the options are to take action.
