What Constitutes Federal Illegal Gambling?

Not every gambling case is prosecuted in federal court. Federal authorities usually step in when the operation is large in scale, crosses state lines, or involves online activity. In these situations, prosecutors rely on a set of federal statutes that specifically target gambling enterprises:

Illegal Gambling Business Act (IGBA) – 18 U.S.C. § 1955

The IGBA is one of the most commonly used statutes in federal gambling cases. A gambling business may be prosecuted under this law if:

• It involves five or more people (including operators, employees, or associates),

• Operates for more than 30 days in a row, or

• Generates $2,000 or more in revenue in a single day.

The Wire Act – 18 U.S.C. § 1084

Originally enacted to target organized crime, the Wire Act makes it illegal to use wire communications — such as telephones, servers, or the internet — to transmit bets or gambling-related information across state or national borders. While its scope has been debated in court, federal prosecutors continue to use it to pursue sports betting and online wagering cases.

Unlawful Internet Gambling Enforcement Act (UIGEA)

This statute focuses on the financial side of online gambling. It prohibits banks, payment processors, and other financial institutions from knowingly handling transactions connected to unlawful internet gambling. Even if the gambling itself is not clearly criminalized under state law, the processing of payments can trigger UIGEA charges.

Additional Federal Charges Often Added

Federal gambling prosecutions rarely stop at a single statute. Because the government often frames these cases as part of larger criminal enterprises, defendants may also face:

• Conspiracy (agreement to further the illegal gambling business),

• Racketeering (RICO) (alleging the gambling operation was part of an ongoing criminal enterprise),

• Money Laundering (moving or disguising gambling proceeds), and

• Wire Fraud or Mail Fraud (if interstate communications or transactions are involved).

Penalties for Federal Illegal Gambling Convictions

A conviction in federal court for illegal gambling can have consequences that extend far beyond fines or short jail terms. Federal prosecutors treat these cases seriously, and judges have broad authority to impose harsh sentences. The specific penalties depend on the statutes involved, the scale of the operation, and whether additional charges such as conspiracy or money laundering are included.

Potential Sentences and Fines

• Prison Time: A conviction under the Illegal Gambling Business Act (18 U.S.C. § 1955) carries a sentence of up to five years in federal prison. If prosecutors add charges under the Racketeer Influenced and Corrupt Organizations Act (RICO) or money laundering statutes, penalties can increase dramatically — in some cases to 20 years or more.

• Financial Penalties: Federal fines are often calculated based on the scale of the operation. Defendants may be ordered to pay fines up to twice the financial gains of the gambling business, which can reach hundreds of thousands or even millions of dollars.

Asset Forfeiture

Seizures can happen before a conviction, and recovering property requires immediate legal action. Federal authorities have wide power to seize assets connected to suspected gambling activity. This can include:

• Bank accounts

• Business property

• Vehicles

• Computers and servers

• Real estate allegedly linked to gambling proceeds

Collateral Consequences

• Professional impact: Damage to your career, inability to hold certain licenses, and difficulty finding future employment.

• Immigration consequences: Non-citizens may face deportation or denial of naturalization.

• Reputation and family stability: A federal conviction creates a permanent criminal record that can disrupt family life, finances, and standing in the community.

How Federal Gambling Investigations Unfold

Federal gambling cases do not usually begin with an arrest. Instead, agencies such as the FBI, IRS, and Department of Justice spend significant time gathering evidence before moving forward. These investigations can last months or even years, and by the time charges are filed, prosecutors often believe they have already built a strong case.

Common Federal Investigative Tactics

• Surveillance and monitoring: Tracking phone calls, online activity, and financial transactions connected to suspected gambling operations.

• Subpoenas for records: Demands for bank statements, business documents, emails, and other communications.

• Wiretaps and informants: Secretly recording calls or using cooperating witnesses to collect incriminating statements.

• Search warrants: Seizing computers, cell phones, servers, and business property to obtain digital and financial evidence.

• Grand jury proceedings: Presenting evidence to a panel of jurors to secure an indictment before trial.

Why Timing Matters

Because these investigations are so thorough, defendants are often at a disadvantage once charges are announced. By that point, the government has already gathered evidence and coordinated with multiple agencies.

Retaining a criminal defense attorney as soon as you become aware of an investigation can make a critical difference. Early legal intervention allows your attorney to:

• Protect you from unintentionally helping the government’s case,

• Challenge improper searches or surveillance,

• Address subpoenas before damaging information is turned over, and

• Begin building a defense strategy before indictment.

How The Law Offices of Arash Hashemi Defends Federal Gambling Cases

Every federal gambling case is different. Some involve allegations of online sports betting, while others target card rooms, payment processors, or even employees accused of helping manage transactions. Because of these differences, a “one-size-fits-all” defense is never effective. At the Law Offices of Arash Hashemi, we build defense strategies tailored to the unique facts of each case and the goals of each client.

Common Defense Strategies in Federal Gambling Cases

• Challenging Searches and Seizures
  Federal investigations often rely on digital evidence, financial records, and surveillance. If evidence was obtained through an unconstitutional search, a defective warrant, or overly broad digital seizure, we file motions to suppress that evidence. In many cases, this can weaken or even collapse the prosecution’s case.

• Disputing IGBA Thresholds
  To convict under the Illegal Gambling Business Act (IGBA), prosecutors must prove the operation involved at least five people, lasted 30 consecutive days, or earned $2,000 in a single day. Demonstrating that these thresholds were not met can undermine federal jurisdiction and result in reduced charges.

• Questioning Intent and Knowledge
  Prosecutors must prove that a defendant knowingly participated in an illegal gambling business. We highlight evidence showing a lack of intent or good-faith reliance on vendors, platforms, or others who presented the activity as lawful.

• Exposing Weak Financial Evidence
  Gambling prosecutions often turn on money flow. We scrutinize financial records to separate legitimate revenue from alleged gambling proceeds and challenge the government’s interpretations of payment activity.

• Challenging Conspiracy and RICO Allegations
  Federal cases frequently include conspiracy or racketeering (RICO) charges to increase potential penalties. We push back against these claims by demonstrating that a client’s role was limited, incidental, or unrelated to the alleged enterprise.

• Protecting Assets
  Asset forfeiture can devastate clients before a conviction even occurs. We challenge unjustified seizures of bank accounts, property, or business income and fight to have assets released so clients can maintain financial stability while their case proceeds.

Why Early Legal Intervention Matters

By the time federal charges are announced, prosecutors and investigators have already spent months gathering evidence, interviewing witnesses, and analyzing financial records. In many cases, they have also seized assets, frozen bank accounts, or served subpoenas. Once the indictment is filed, the government already believes it has built a strong case — which means defendants start at a disadvantage.

Speaking to federal agents without representation almost always harms your position. Even seemingly harmless statements can be misinterpreted or used to strengthen the government’s case. Having an experienced Beverly Hills criminal defense attorney involved early ensures that your rights are protected from the beginning.

How Early Representation Can Help

• Prevent charges from being filed: In some situations, effective pre-indictment advocacy can convince prosecutors not to move forward.

• Protect your rights during searches or interrogations: A lawyer ensures that federal agents follow proper procedures and do not overstep their authority.

• Engage with prosecutors before indictment: Early negotiations may reduce the severity of charges or limit the scope of the case.

• Prepare a defense strategy immediately: Beginning work before indictment allows your attorney to challenge evidence and build the strongest possible defense.

Frequently Asked Questions About Federal Gambling Charges

Can I be charged for simply placing bets with an illegal gambling site or operation?
Federal prosecutors usually target organizers, operators, and financial backers of gambling operations, not casual bettors. However, if someone is placing very large wagers, betting frequently, or helping fund the business, they may be drawn into a broader investigation.

How do federal agencies investigate gambling operations?
Agencies like the FBI and IRS rely on surveillance, financial monitoring, wiretaps, subpoenas, and even cooperating witnesses to build their cases. These investigations often last months or years before charges are filed, which is why many people are surprised when they suddenly face indictment.

Can the government seize my bank accounts or property before trial?
Yes. Under federal forfeiture laws, assets that the government claims are connected to illegal gambling can be seized even before conviction. You have the right to challenge these seizures in court, and early legal intervention is often critical to protecting your property.

What kind of penalties could I face if convicted of federal gambling charges?
Penalties depend on the charges and statutes involved. A basic IGBA conviction can carry up to five years in prison. If conspiracy, money laundering, or RICO charges are added, sentences can reach twenty years or more, along with significant fines and asset forfeiture.

What should I do if federal agents contact me about gambling charges?
Do not answer questions or provide statements without a lawyer present. Politely decline to speak and immediately contact a federal criminal defense attorney. Anything you say can be used against you, even if you think you are only a witness.

Contact a Beverly Hills Federal Gambling Defense Attorney

When you are facing federal gambling charges, your immediate first step should be to retain an experienced defense lawyer. Federal prosecutors have extensive resources, and once charges are filed, they will work tirelessly to secure a conviction. Early intervention by an experienced Beverly Hills federal defense attorney can make a decisive difference in the outcome of your case.

At The Law Offices of Arash Hashemi, we are dedicated to protecting the rights of individuals accused of serious state and federal crimes. For more than 20 years, Attorney Arash Hashemi has represented clients in Beverly Hills, West Los Angeles, Culver City, Santa Monica  and throughout Southern California. We provide aggressive, confidential, and effective legal defense at every stage of the federal process — from investigation to trial and appeal. Call us today for an immediate consultation.

The Law Offices of Arash Hashemi
11845 W Olympic Blvd #520
Los Angeles, CA 90064
📍 Get Directions

📞 Phone: (310) 448-1529
📧 Email: Contact@hashemilaw.com
🌐 Schedule a Free Consultation

🕒 Office Hours: Monday–Friday, 8:30 AM – 5:00 PM
Evening & weekend appointments available by request.