Unlawful Internet Gambling Enforcement Compliance Delayed

Lora Bentley

The Federal Reserve and the U.S. Treasury Department have delayed compliance deadlines that would have required financial institutions to implement policies "reasonably designed" to prevent payments to illegal gambling Web sites by Tuesday, Dec. 1. Bloomberg reports required compliance will pushed back to June 1.


The rules, which were adopted in November 2008 under the Unlawful Internet Gambling Enforcement Act, were intended to "limit the use of payment systems" for online gambling. Apparently, however, they do not differentiate enough between illegal online gambling and legal online gambling, such as the purchase of lottery tickets, or in some states, betting on horse races or dog races.


As such, industry groups such as the National Thoroughbred Racing Association and the Poker Players Alliance, among others, have been pushing for a compliance delay, and House Financial Services Committee Chair Barney Frank agrees. In a statement last week, he praised the agencies for suspending the regulations, which he said would "pose unrealistic burdens on the entire financial community."


According to an American Bankers' Association compliance overview, because the act does not specifically define unlawful gambling, banks are required to do their part by "preventing unlawful Internet gambling businesses from benefitting from the payment system by denying them the opportunity to open bank accounts from which to receive payments." To that end, banks are required to screen commercial customers before opening a new account, and must inform commercial customers of the act's prohibitions.

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Dec 4, 2009 7:17 AM stefan k stefan k  says:

Great stuff! This Bush-led law was ridiculous from the outset, its only a shame that it has been repealed due to the influence of the banks.

Hopefully we will now see a domino effect, and other countries with extremely strict gaming laws - such as Greece, Holland & Portugal (see www.right2bet.net )  will decide to liberalise their industries.

Dec 15, 2009 9:53 AM Max Mitchell Max Mitchell  says:

The thing that I don't understand with this bill is that the government seemed to be blind with the advantages of legalizing online gambling in the US. We're talking about millions of dollars as revenues. Casinos outside the US like Gamblux online gambling and other online casino sites generates profits big time which means big amount of tax as well.

Dec 17, 2009 6:31 AM Kevin Kevin  says: in response to Max Mitchell

This absurd law was a gift from Bush to the radical right-winged Christian fundamentalist base that put him in Office (along with a few Supreme Court Justices). Gambling (the second oldest profession) is apparently an 'evil' you see...and must be eradicated from the land. Thus, the UIGEA. So much for all of that 'freedom of choice, free market, govt. hands off' rhetoric that the Right was spewing at the time. This apparently only applied to big businesses and other wealthy contributors to conservative coffers but not when it came to you and I exercising the ancient right to place a bet amongst ourselves.


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