Do I Break the Law When Placing Bets on Offshore Gambling Websites or Use an Overseas Account?
The bad news: No, you cannot legally bet or gamble on offshore or overseas websites or sports books. If you feel inclined to “roll the dice," you are opening yourself up to legal liability while having few, if any, enforceable legal rights.
The longer version: You cannot legally place bets on any website (or use an out-of-state or overseas account) if you are physically placing the bet online in a state which bars online gambling. This applies to both international and interstate online betting. For example, Delaware has legal online gambling; neighboring Maryland does not. Ignoring for the moment the technological safeguards which are supposed to make it impossible to bet online from a state other than one whose website you are betting on, if you did manage to place an online bet on a DE website from MD, you'd be violating the law. The reason is, the website (or account you're using to place the bet) may be out of state, BUT you are not—and hence, you are subject to your state's jurisdiction (legal power) and laws. Legal betting requires that it be legal in both the place where the bettor or gambler are and the place where the casino or sports book is located.
If you are breaking the law by placing a bet from MD on a DE website, when those are both U.S. states, then you'd also be breaking the law to place a bet from, say, MD, on a UK sports book or a Maltese online casino. While the Internet may have tied the world together to a degree not even imaginable by prior generations, physical presence is still paramount for certain things, and one of them is determining whose laws you are subject to. Long story short, you are subject to the laws of the place you are located.
The operator or website must also be authorized where you are gambling
Most things are either legal or they are not legal. Take whether or not your state allows "common law" marriages (marriages made by living together and telling people you are married, without having a marriage license or ceremony). If your state allows them, it allows them for all state residents. You don't need a special license or authorization for it. Or highway speed limits: if it's legal to drive 65 on a stretch of highway, it's legal for everyone--again, you don't need a special 65-mph license. But gambling is not like that: not only must the type of gambling be legal in your state, but the gambling or operator must be specifically licensed by the state, too. If it's not, then gambling with them is illegal--and it's not just illegal for them to offer it to you, it's illegal for you place the bet.
At present, very few states authorize online gambling or sports betting. That means in most states, placing a bet online will be illegal, or placing a bet with an overseas sports book (like Ladbrokes) will be illegal. And even if you are in a state which allows online gambling, the site you want to gamble with must be authorized for it to be legal to bet with them--and states allowing sports betting are not going to allow overseas sports books not licensed by them.
There is simply no way around it: no matter whether the gambling you want to do is legal where the provider (the sports books or online casino) is located, if it's not legal and authorized where you are, it's illegal for you.
Legal consequences for the individual bettor
As a practical matter, bettors or gamblers will rarely get into serious trouble or be prosecuted for illegal gambling. BUT “rarely” does not mean "never," and there have been prosecutions of people who place illegal bets overseas. Fortunately, even when prison time is possible, it's typically only days, weeks, or a few months--no state makes placing illegal bets a felony. Instead, since placing an illegal bet is a disorderly person offense or misdemeanor at most, the "worst" you might get is up to a year (and usually more like two or three months) in jail--which is still bad for just trying to place a bet.
Furthermore, you can't enforce an illegal contract, and a debt, including a gambling debt, is a contract. (Read our article on enforcing gambling debts.) If your overseas sports book or online casino takes your money or doesn't pay your winnings--or worse, disappears or closes--you have no legal recourse. You can't sue for your hard-earned cash in U.S. courts. (Even if you could, U.S. courts can't enforce their judgments directly in foreign nations, and some nations--like many gambling havens--will not enforce a U.S. court judgment against their citizens and businesses, leaving you no way to collect).
U.S. and state relationships with foreign governments
Overseas betting sites or sports book are not bound by U.S. or state laws. Neither the states nor the federal government have any say over what other countries allow or legalize. Equally, the United Kingdom, or the Philippines, or Malta, or Antigua (or any other gambling Mecca), can't control our gambling laws or policy. They are free to legalize whatever types of gambling they want and regulate the business of gambling within their borders, but they can't let U.S. citizens gamble on their gambling sites from the United States. While they can make it legal for their licensed gambling operators or providers to accept bets from outside their territory--i.e., from overseas--so that the provider does not get in trouble for accepting your bet, you can still get in trouble here for placing it.
To sum it up
It would be legal to bet using an offshore account or sports book, only IF you physically place the bet in a state where it is legal (most states do not allow it) and with a website or sports book licensed by the state in which you are located (see our article on searching for reputable online gambling sites). The odds, however, of it actually being legal to place an overseas bet, including using an overseas account, are very slight. It is unlikely that the type of gambling (e.g., sports wagers), the ability to bet online, and the specific overseas provider are all authorized by your state.
And remember: above and beyond the possibility of facing penalties for illegal gambling for overseas betting, in the event of a dispute, you most likely will not be able to sue or have any recourse. Be smart, be safe: restrict yourself to the gambling legalized by your state and providers licensed by it (if any), or else take a gambling junket to Las Vegas or Atlantic City or Macau (in China) --they'll be thrilled to see you and your money.