News
Relaxation of Online Gambling Restrictions Will Complicate Compliance, Say Attorneys
By Brian Monroe
printA U.S. Justice Department memorandum clearing the way for online gaming may exacerbate compliance woes for banks operating under a 2006 anti-gambling law, say attorneys and industry groups. The department said Friday that it had interpreted the 1961 Wire Act to bar only certain interstate sports betting, a prohibition that does not affect online poker sites or lotteries. The clarification comes as at least half a dozen states are mulling whether to allow online and brick-and-mortar gambling operations as a means to increase revenue. But while the Justice Department has made it clear that it's up to state lawmakers to...
TO READ THE FULL STORY
Subscribe
Learn More
Related News
The introduction of new merchant codes to identify legal online wagers has spurred a handful of U.S. banks to reconsider the compliance risks of processing payments for the online gaming industry, according to sources.
Leaders of a senate panel Wednesday called for stronger oversight of online gaming to reverse the effects of a 2011 U.S. Justice Department memorandum that loosened restrictions on the industry.
An agreement between a global online gaming company and an Atlantic City casino to offer Internet wagering in New Jersey faces an uphill battle to gain the necessary approval from state regulators, say analysts.
Fueled by the need to fill budgetary coffers, the expansion of casinos in the United States will likely foster another sort of growth-more state anti-money laundering laws.
In the wake of a Florida crackdown on cashless gambling operations, some large banks have begun reviewing their relationships with Internet sweepstakes parlors, say compliance officers.
Since the 2011 indictment by the U.S. Justice Department of some of the most prominent online gambling sites in the world, the financial risks posed by Internet betting have changed, believes Christine Duhaime, barrister and solicitor at Vancouver-based Duhaime Law.
As some states inch toward legalizing online gambling, they are unlikely to get much cooperation from financial institutions concerned that they'll be held liable for processing even legal bets, say analysts.
The U.S. Justice Department is seeking $3 billion in forfeitures and fines from three of the largest online gambling businesses and the financial institutions and individuals that helped to process bets.
The U.S. House Financial Services Committee approved a measure Wednesday that would legalize some Internet gambling and diminish the compliance duties of financial institutions monitoring for online bets and payouts.
U.S. banks are still fine tuning policies on when to report suspicious activity and reject transactions tied to online gambling after the passing of a June 1 enforcement deadline.
An online gambling ban that requires banks to monitor for illegal transactions is unlikely to be overturned before a June 1 enforcement deadline, despite congressional efforts to repeal the law.
U.S. Justice Department cases tied to a controversial ban on online gambling will likely complicate congressional efforts to overturn the law before a June enforcement deadline, say government officials and consultants.
Partisan bickering and a backlog of legislation are stymieing congressional attempts to overturn a controversial ban on online gambling before a June enforcement deadline, according to analysts.
The federal ban on processing transactions tied to Internet gambling will likely be overturned at some point, but lawmakers have yet to address how to best mitigate related money laundering risks, according to a former IRS agent who recently testified before U.S. lawmakers.
A bill that would legalize Internet gambling within the United States through licenses issued by the Treasury Department will likely be approved by the House of Representatives, say analysts.
U.S. financial regulators Friday granted financial institutions a six-month delay in enforcing a controversial Internet gambling ban that will require banks to freeze transactions tied to the illegal organizations.
A call by over a dozen lawmakers to delay a Dec. 1 deadline requiring banks to block transactions tied to Internet gambling won't likely sway the White House, say analysts.
A Canadian national laundered nearly $380 million and illegally processed payouts from online gambling companies to their U.S.-based customers, according to a federal indictment released Thursday. The indictment seeks more than half-billion dollars in forfeitures.
Odds that banks won't have to implement programs to detect online gambling have markedly improved this year after past efforts to halt the regulation fell flat, according to gaming experts.
The United States has ordered four banks to freeze $33 million tied to companies that dole out winnings to online poker players, according to an Internet gambling advocacy group.