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DoJ to hold off on Wire Act enforcement until 2020

by: ROBIN-HARRISON-MILLAN for igbnorthamerica.com - posted on: 13-Jun-2019

This article is a reprint from IGBNorthAmerica.com. Read the original here.

A memo from the US Deputy Attorney General has informed law enforcement staff working under the Department of Justice (DoJ) that there will be no attempt to enforce the revised interpretation of the Wire Act until 2020.

The letter, from new Deputy Attorney General Jeffrey Rosen, extends the forbearance period for the revised opinion to December 31, 2019, or 60 days after the final judgement in New Hampshire’s legal challenge against the new opinion, whichever is later.

The DoJ originally stated that it would enforce the law, based on the stance that the Wire Act applies to all forms of gambling, 90 days after the revised opinion was published in January, from April 15. In March this was pushed back to June 14.

With that deadline falling tomorrow, the Department has now effectively stated that it will not prosecute companies for failing to comply with its interpretation of the Wire Act this year. Rosen has also informed law enforcement officials that the moratorium on prosecuting state lotteries for non-compliance, issued in April, remains in place.

However, Rosen also suggested that the delay in enforcing the Department’s new stance did preclude it from prosecuting companies that it considered to be in breach of its Wire Act interpretation.

"Providing this extension of the forbearance period is an internal exercise of prosecutorial discretion and does not create a safe harbor for violations of the Wire Act," he wrote.

The memo has been sent to all US Attorneys General and their deputies, and to the director of the Federal Bureau of Investigation (FBI).

The DoJ is yet to confirm that it will challenge the ruling handed down by the New Hampshire District Court earlier this month. Rosen’s memo notes that the Department is "evaluating its options" on the matter.

This ruling set aside the DoJ’s revised stance in favour of a 2011 interpretation that rules the 1961 legislation only applies to sports betting. The judge that heard the case, Paul Barbadoro, said the New Hampshire Lottery faced a "a direct and immediate impact on [its] operations" from the new Wire Act opinion, adding that the Department’s new stance "made little sense".

Should the DoJ lodge an appeal, the case would move to the First Circuit Court of Appeals.