Re: Can it get any worse offshore?
I'm disgusted by all of this, but if anyone is unfamiliar with the basic time line of events for the last year and a half or so:
September 30-31, 2006 the Unlawful Internet Gambling Enforcement Act (UIGEA) was passed by the Senate.
Within days respected gambling-law lawyers (e.g.,
I. Nelson Rose ) and others rebuffed it. An example of a common analysis from that time (from Hilary Stewart-Jones, of Berwin Leighton Paisner):
"We are reeling at the amount of misinformation that has been circulating in the past few days ... It's just a runt of a Bill which, contrary to reports, does not make it a criminal offence for the banks to handle these transactions. There are clear lacunae in the proposed legislation, which means that internet gambling may still be legal. The impact of the Bill is psychological more than anything else."
Less than two weeks later offshore sportsbooks, poker sites and casinos began to sell their US-facing businesses and leave the US market altogether.
Also at that time Partygaming issued at statement declaring their intent to cut-off US players in real money games:
After taking extensive legal advice, the Board of PartyGaming Plc has concluded that the new legislation, if signed into law, will make it practically impossible to provide US residents with access to its real money poker and other real money gaming sites. As a result of this development, the Board of PartyGaming has determined that if the President signs the Act into law, the Company will suspend all real money gaming business with US residents, and such suspension will continue indefinitely, subject to clarification of the interpretation and enforcement of US law and the impact on financial institutions of this and other related legislation.
Two weeks later, October 13, 2006, President Bush signed the UIGEA to make it law.
The "teeth" of the law had yet to be defined though, a task that was up to the US Department of the Treasury and the Board of Governors of the Federal Reserve System -- a task many said would be an unwieldy process, if not outright impossible.
In the next two months several more internet gambling sites denied US customers.
Throughout the entire affair (even before the bill was introduced to the House of Representatives) chatter in online gambling forums ran the range from outright defiance to fear and loathing.
January 11, 2007 Pinnacle, a highly respected book, abruptly announced it too would no longer accept action from US customers.
Pinnacle's rejection stunned most US customers.
Four days later, January 15, 2007, NETELLER's top two former Directors of the company, Stephen Lawrence and Mr John Lefebvre, were detained by US authorities and later charged with "laundering billions of dollars in gambling proceeds". The FBI issued as statement describing NETELLER as "colossal criminal enterprise masquerading as legitimate business"
.
NETELLER's fate, via a Deferred Prosecution Agreement:
NETeller, admitted criminal wrong doing and agreed to forfeit $136,000,000 for its part in a conspiracy to promote Internet gambling businesses and to operate an unlicensed money transmitting business. The company also agreed to return $94 million held in the accounts of U.S. customers since January 2007. The two founders of NETeller, Stephen Lawrence and John Lefebvre pled guilty to conspiring to promote illegal Internet gambling businesses and agreed to forfeit $100 million.
Near this time, June 2007, Partygaming accounced it was in talks with US law enforcement agencies to determine "what action, if any, they intend to take regarding industry players that had accepted bets from US citizens, prior to the signing of the Unlawful Internet Gambling Enforcement Act of 2006."
And all of this happened
before the bill was given it's official "teeth" by the US Department of the Treasury and the Board of Governors of the Federal Reserve System; that is, before specific rules were actually established to strangle to flow of money to offshore gambling sites.
In October 2007, the US Department of the Treasury and the Board of Governors of the Federal Reserve System finally got around to defining the required rules of the UIGEA. The way the did it was to identify methods of money transfer and then put it on the banks, money transfer services, and other financial institutions to "establish policies and procedures reasonably designed to identify and block or otherwise prevent or prohibit such transactions".
It seems the specific procedures and policies to block money are up to each individual financial institution and money transfer company.
Money transfer services that want to do business in this area may elect to design a more "liberal" system? I'm not naming names, but it should be clear.
Source:
The War Against Online Gambling retrieved from
The War against online gambling - How the US sought to stamp out internet gambling March, 25, 2007.
