Financial Services attacking US gambling rules | IXGAMES

Banking lobbyists are warning the US Treasury that regulations proposed in the wake of last years sweeping anti-gambling law will be impossible to comply with unless the Bush administration clarifies its conflicting views on online betting. The criticism raises new questions about whether regulators will be able to enforce a law that, in effect, requires banks and other institutions to know the purpose and legality of payments in an industry – online gambling – in which federal and state rules often conflict. The proposed rules would require US financial companies with designated payments systems to have policies and procedures that are reasonably designed to prevent payments being made to illegal gambling businesses. According to the US Treasury, illegal gambling consists of any bet or wager involving the internet that is illegal in the state in which the bet is made. The proposed rules were drafted after the passage last year of the Unlawful Internet Gambling Enforcement Act, a bill that wiped billions of dollars in value from non-US gambling websites. At the centre of concerns raised by the Roundtable is the fact that it is far from clear whether banks would also have to block payments from US-based gambling sites, including websites that take bets on horses. The horse-betting industry maintains that state laws allowing wagers on horses trump federal laws. Legislators left the issue alone last year by including language in the anti-gambling legislation that said it did not apply to wagers on horses.