Legal New Jersey Poker
Online poker is legal in New Jersey and it is the second largest state for poker in the United States.
New Jersey gambling started in the early 1800s when lotteries were common and other forms of gambling took place throughout the territory. In 1844, the New Jersey government banned the lottery, leaving only horse racing as legal and prevalent. The oldest racetrack in the United States – Freehold Raceway – is located there and began to race back in the 1830s. But in 1894, pari-mutuel gambling was banned, and three years later, all types of gambling were prohibited by law.
Gambling took place from that point forward but in back rooms and away from the eyes of law enforcement. Pari-mutuel gambling was reauthorized by New Jersey in 1939, and voters approved charitable gambling in 1953 in the form of bingo and raffles. Two years later, amusement games were allowed, and the lottery was made legal in 1969.
The first vote to legalize casinos found the voters against the 1974 referendum, as they opposed casinos throughout the state. But in 1976, a different referendum that proposed casinos in Atlantic City only passed. Resorts Atlantic City was the first casino to open two years later, and many followed after. Casinos then expanded in 1993 to add poker and simulcast races, with keno introduced in 1994.
Online poker and internet casino games were legalized by the state legislature in 2013.
Latest Developments Regarding Online Poker in New Jersey
In the handful of years that the online gaming industry has been growing in New Jersey, the operators and casino partners have changed quite a bit since it began. In 2013, when the initial launch took place, the casinos and sites were as follows:
- Borgata: Online poker and casino via PartyPoker
- Caesars: Online poker and casino via WSOP and 888poker
- Harrahs: Online poker and casino via WSOP and 888poker
- Tropicana:Online casino only
- Trump Plaza – then Golden Nugget: Online poker and casino with Betfair
- Trump Taj Mahal – Online poker and casino with Ultimate Poker, now defunct
PokerStars then underwent significant scrutiny before being granted a license to enter the New Jersey market with Resorts Casino, which finally happened in March 2016. A little more than one year later, Pala launched online poker in New Jersey with Borgata, and MGM joined in the summer of 2017 with Scores, a strip club.
The industry has grown tremendously from its inception as well, having recently surpassed the total of $246 million internet gaming revenue in 2017 alone and achieving more than $772 million lifetime revenue by the end of 2017. Revenue from 2016 to 2017 climbed nearly 25%, with sizeable increases – especially for online casino games – each month for several years.
On October 13, 2017, New Jersey finally entered into an agreement with Nevada and Delaware to share online gaming liquidity. Governor Chris Christie gathered with Nevada Governor Brian Sandoval and Delaware Governor John Carney to sign the compact that would result in online poker sites sharing. This came three and a half years after Nevada and Delaware signed an initial agreement to share online poker player pools. The new tri-state agreement will likely still consist of only the WSOP/888 poker sites, as that is the only partnership available in all three states, and it will likely launch in 2018.
State Senator Raymond Lesniak has championed more than statewide online poker and casino games, as he also introduced legislation in 2017 to allow New Jersey to share liquidity with other markets around the world. While the New Jersey Division of Gaming Enforcement tried to sign an agreement with the UK Gambling Commission previously, Lesniak’s SB.3536 would remove some of the obstacles that prevented that contract from being signed. The primary obstacle is the required location of internet gaming servers, and the new bill would allow it be situated outside of Atlantic City – in the UK, for example – so international partnerships may be possible.
Lesniak is retiring from his legislative seat, however, and it is unclear if any other lawmakers in the state will take up the task of pursuing international online poker liquidity after his departure.
Finally, New Jersey is trying to expand the world of sports betting. The state has been in a long battle with American sports leagues over the right to offer sports betting out of Atlantic City, but the federal Professional and Amateur Sports Protection Act of 1992 (PASPA) has been regulating the industry for years. A handful of states, Nevada being the most prominent, are allowed to offer sports betting under the nationwide law.
New Jersey took its case through the court system and argued before the United States Supreme Court in the fall of 2017. A final ruling is expected in early 2018, and many legal experts are optimistic that New Jersey will win its case, which will give all states the right to legalize and regulate sports betting. It could set a national precedent and open the world of betting, in addition to encouraging other states to consider further gambling expansion that could include more online poker and gaming.
New Jersey Laws Pertinent to Online Poker
The first bill introduced to the New Jersey legislature to legalize online poker came in January 2010, and lawmakers in both houses passed the bill at the beginning of 2011. However, the governor vetoed the bill because of legal concerns. State Senator Raymond Lesniak then produced a revised bill, which went to the floor for votes and passed again in 2012. That time, Governor Chris Christie vetoed again but that time on a conditional basis.
The state legislature then amended the bill to raise the tax rate, allocate more funds for problem gambling initiatives, and a number of other changes requested in the lengthy conditional veto. After passing votes in the Assembly and Senate, Christie signed that version of the bill on February 26, 2013. It became the third state in America – behind Nevada and Delaware – to legalize online poker.
The New Jersey Division of Gaming Enforcement immediately went to work to develop a regulatory framework for the new industry, and licenses were subsequently issued. On November 21, 2013, six casinos and their online gaming partners participated in a synchronized launch of online gaming.
Internet gaming was put into Title 5 (Amusements, Public Exhibitions, and Meetings) of the New Jersey Statutes. A 1976 amendment to the New Jersey Constitution and the Casino Control Act both authorized gaming to help rehabilitate Atlantic City, and a 2010 report commissioned by the governor showed that gaming in New Jersey was at a crossroads. Those were part of the impetus for legalizing online gaming, as well as the public’s “vital interest” in the industry’s success and the need to protect consumers from unregulated gaming sites.
The statute also listed several mandates inherent in the new law:
- Effective regulatory and licensing system will increase public trust and confidence in legalized gambling and ensure internet games are fair
- Will end practice of sending jobs and tax revenue overseas to illegal operators
- Will ensure only those of “good character and fitness” participate in operations
- Regulators will restrict and stop the illegal internet gambling market
- Industry will assist and enhance the rehabilitation and redevelopment of Atlantic City
- Regulations remain consistent with original intent of Casino Control Act
- Games to take place entirely on servers and computer equipment located in Atlantic City
- Equipment will be under the complete control of the casino licensee or affiliate
Other details in the statutes include a tax on internet gaming gross revenues of 15% for the Casino Revenue Fund, and a 5% investment alternative tax will be added. Permits to conduct internet gaming will be valid for one-year periods, after which the regulator must issue a finding about compliance with all necessary requirements.
The Division of Gaming Enforcement is required to issue a report to the governor each year regarding the impact of internet gaming on problem gamblers in order to consistently address responsible gaming and any changes which could improve the effectiveness of current regulations.
Charges for those who offer internet gaming without regulatory approval in New Jersey will be guilty of a fourth-degree crime and subject to a $25,000 to $100,000 fine. Even more sever is the penalty for tampering with software, computers, or other equipment involved in internet gaming to alter the odds or payouts, and those fines can range from $50,000 to $200,000. If a casino employee is convicted of said crimes, they will lose their employment license. Casino licensees found guilty will be subject to “further penalty as the division deems appropriate.”
Disclaimer: This is not written by an attorney and is not or should not be construed as legal advice. Please consult an attorney for help interpreting these laws as they pertain to any given situation.
Frequently Asked Questions
Question: Why are there recommended sites for New Jersey that are not regulated in the state?
Answer: Most online poker players in New Jersey compete on the sites that are licensed in the state and regulated there as well. Some players, however, seek larger player pools and other site options. Those players do have a few sites from which to choose that are licensed in other countries. The legality of those sites is unclear, but sites like BetOnline have been open to New Jersey players for many more years than the state-regulated sites.
Question: Can players be penalized for playing on non-New Jersey poker sites?
Answer: It is unlikely that the state regulator would pursue players who make different choices for online poker. If the regulation enforcement agents decide to pursue charges against offshore poker sites that remain open in New Jersey, players would likely be exempt from any prosecution in that case as well.
Question: How is PokerStars legal in New Jersey but not Nevada?
Answer: When Nevada legalized online poker, its law included a clause to prevent sites like PokerStars, to whom they refer as “bad actors,” from operating in their state because PokerStars remained in the United States after the passage of the Unlawful Internet Gaming Enforcement Act (UIGEA) of 2006. While PokerStars did pay a legal price and settled with the US government as a result, Nevada keeps PokerStars on its excluded list. Meanwhile, New Jersey felt it a good choice to give PokerStars a chance. The regulator completed an extensive investigation into the company to ensure it is now in full compliance with all US laws, and the site passed all tests. Therefore, New Jersey decided to issue an online poker license to PokerStars. Other states like Pennsylvania may decide to do the same.
Gaming Resources in New Jersey