UIGEA Rules Finalised
By Staff
The US Department of the Treasury and the Federal Reserve Board have released their final rules for the implementation of the Unlawful Internet Gambling Enforcement Act (UIGEA) of 2006 despite protests from politicians and the American financial sector.

President George W Bush has only 68 days left in office but will sign the new rules into law on January 19, one day before Barack Obama is sworn in as the 44th President of the United States.

Banks and other financial institutions will then have until December 1 of next year to comply with the new UIGEA regulations even though these remain ambiguous regarding definitions of illegal and legal gambling, instead referring to existing state and Federal statutes.

“Creating such a list (of what is legal and what is not) would require the agencies to formally interpret those laws that are written and enforced by other entities,” read the 66-page final ruling.

“The agencies believe that appropriate due diligence conducted by participants opening accounts would be the most effective method for preventing unlawful internet gambling businesses from gaining access to the payment system.”

The new rules define a ‘bet’ as ‘the staking or risking by any person of something of value upon the outcome of a contest of others, a sporting event or a game subject to chance’ while also controversially exempting fantasy sports subject to certain restrictions including rosters not being composed of all players from a team and up-front prize declarations.

'While we have not had an opportunity to review the full 66-page document in detail, the agencies have stated in their explanation to the final regulation that the Federal Government will not establish a list of businesses known to be involved in unlawful Internet gambling,' said Kathy Thompson, Senior Vice-President of Compliance for the Credit Union National Association.

'Without an 'OFAC-type' list where the government and not private businesses ascertains who is engaging in unlawful activities, I do not see how credit unions and other financial institutions can reasonably be expected to develop a cost-effective compliance programme.”
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