Credit Cards & Online Gambling– Little Change
Even with legislation, online gambling continues to thrive…
In 2006, a federal law caused the $12 billion online gambling industry to “gasp” when the use of credit cards, checks and electronic fund transfers were banned for Internet gaming. The law gave authorities authorization to work with internet service providers and banking institutions to limit and prevent access to online gambling. At the same time, it carved out exceptions for state lotteries and horse racing. But have the laws had any effect?
The ban was originally suggested since most internet gambling sites were run outside the U.S. - putting their owners out of reach of law enforcement and other government agencies. The other concern was the addictive nature of online gambling, causing huge financial losses and attracting underage teens unable to handle the responsibility of online betting.
The new legislation required banks to block transactions with online gambling sites, making them responsible for enforcement of the law. Rep. Bobby Scott, D-Va., argued it would be completely ineffective because banks and credit card companies would find it impossible to detect gambling sites that concealed their identities. In other words, “It cannot possibly be enforced,” said Scott. The cost of enforcement would then be passed on to bank customers who may not want to support the “War on Gambling.”
According to Rep. Shelley Berkley of D-Nevada, it’s unfair to continue to allow lotteries and horse race betting, and at the same time prevent other gambling games such as poker, Blackjack or slots. The prohibition law forced the gambling industry to go underground, which was the concern of those who were objected to the legislation. According to Rep. Barney Frank, “Prohibition didn’t work for alcohol. It won’t work for gambling.”
As many critics have suggested all along, online gambling continues to thrive. Although the industry has undoubtedly taken a hit, people looking to gamble on the Internet will find a vast array of choices, from online casinos to sports books. Surprisingly, most of these sites proudly display their “Deposit Methods” for potential customers– most of which include credit cards and wire transfer options. It doesn’t appear legislation has affected these sites at all. And it’s obvious the operators will continue to find ways around the law…
