Pretend Gambling Meets a Pretend Gambling Ban

The FBI reportedly is investigating gambling in the online virtual world Second Life, which includes casinos where players can place bets using virtual dollars. To me it seems pretty clear that such gambling does not violate federal law, which bans interstate sports betting via a "wire communication facility" but does not prohibit online games of chance. (Contrary to the impression left by a lot of the news coverage, last year's Unlawful Internet Gambling Enforcement Act did not change that fact.) But if we accept the Justice Department's implausible reading of the Wire Act, according to which the phrase "bets or wagers on any sporting event or contest" covers games such as poker, blackjack, and roulette, why wouldn't gambling houses in Second Life, where betting is done with "Linden dollars" that are purchased with and can be converted back into real dollars, be just as illegal as any other online casino?