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Nov
17th

Gambling Transactions Declined in Nevada and Delaware

Although internet gambling has been legalized in three states some banks and payment processors are unwilling to process any transactions related to online gambling. In the near future this could become an issue for internet bingo players in the US. Major American banks like Wells Fargo, American Express, PayPal, and Bank of America will not handle any internet gambling transactions. Online payment processor PayPal is also refusing to process gambling transactions. Bankers point to liability concerns that could arise if underage gamblers use a credit card to play.

Steve Kenneally, the vice president of regulatory compliance for the American Banking Association, told reporters “There are still things that can go wrong even with controls in place. Does the revenue I get offset the potential downside? “There’s still the uncertainty over Internet gambling and the liability that could fall on a bank.” So far only two states, Delaware and Nevada, have launched real money gaming sites. New Jersey will launch their sites on November 26th. Players trying to make deposits have reported that their transactions have been declined.

 

Nevada gaming officials say they are talking to banks to try and clear up issues faced by players. The rejections are threatening a new industry that could produce as much as $7.4 billion annually in four years. In Delaware player’s Visa and MasterCard have been declined. Players in Nevada have had trouble opeining accounts. Visa and MasterCard allow gambling transactions in states where it’s legal but leaves the decision making to the card issuers. Visa spokeswoman Rosetta Jones, stated “Visa has updated its procedures to code newly legalized Internet gambling transactions so that financial institutions can identify and process them in states where they are allowed.”

 

A spokesman for Caesar’s Entertainment told reporters “This is all bank-dependent. here is an education that is ongoing regarding gaming transactions due to the new laws.” Bank of America does not allow gambling transactions although the company’s policies may change in the future. American Express bars all gambling transactions of any sort. PayPal cited internal policies but said the policies are subject to change. Banks programmed their card payment systems to ban gambling transactions after congress passed Unlawful Internet Gambling Enforcement Act in 2006. In Delaware most rejections were Visa transactions. Some banks offering MasterCard have updated their systems to reflect changes in the law. Banks and credit card companies stand to lose millions if they do not update their systems soon.