August 29th, 2008
excerpt:
On October 13, 2006, President Bush signed into law the SAFE Port Act. Buried within this legislation dealing with port security issues was a section entitled the Unlawful Internet Gambling Enforcement Act (UIGEA). The UIGEA, which had literally been added at the eleventh hour, has been the source of a great deal of confusion and debate regarding its applicability to internet gambling. The UIGEA did not actually outlaw internet gambling. Rather, it prohibited the transfer of funds from United States financial institutions to internet gambling sites that were not defined in the Act as “legal’ sites (i.e. sites devoted to fantasy sports, online lotteries, and horse/harness racing). The effect of this act has been to move most internet gambling sites off shore and to create confusion for financial institutions whose clients seek to use such sites.
The UIGEA - which itself was not a model of clarity - was supposed to be augmented within nine months of its enactment by regulations promulgated by the Department of Treasury and the head of the Federal Reserve System. In March, 2008, more than sixteen months after the UIGEA was passed, proposed regulations were finally published. Instead of clarifying the issues, however, the proposed regulations merely shifted the responsibility of interpreting and enforcing the UIGEA to the banks and financial institutions. The proposed regulations have been criticized by Senators John Sununu and Pete Dominici who noted in a joint letter that while the regulations provide “certain guidance for the regulated community,” they leave “ambiguity as to what sort of transactions are to be blocked.” In a similar vein, the American Banking Association objects to the lack of guidance in the proposed regulations, stating in a comment letter that “the definition of what constitutes ‘unlawful internet gambling’ is inadequate [and] must be rectified.”
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Poker Pages: UIGEA and Congress - Where we are, what’s next by Shari Geller
Author Contact Info: Shari Geller, PokerPages.com
Tags: UIGEA
