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US appears to soften ban on online betting

December 23, 2011
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WASHINGTON—The Obama administration appears to have softened a U.S. ban on Internet gambling.

In a legal opinion posted Friday, the Justice Department said online betting unrelated to sporting events falls outside the reach of federal law.

The U.S. government has long considered such gambling illegal when it crosses state lines.

The gambling industry is worth billions worldwide but many operators are based overseas. Washington has cracked down on some of them, and a 2006 law forbade financial institutions from processing funds for most online wagering.

Because of the difficulty in enforcing age and other requirements, the issue has divided lawmakers and the industry. But several states have been studying plans for web betting within states.

The opinion letter was first reported by the Wall Street Journal.

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