Visa Pulls the Plug on '7995' Cheaters

On May 22, Visa instituted a new policy that will block some Internet gambling transactions that were being miscoded by site operators.

Banks in Visa's U.S. region were informed of the change via a letter from Visa, said Casey Watson, a spokeswoman for the credit card company. In the Visa network, individual banks decide whether to accept Internet gambling transactions.

"... It was obvious to us that the Internet gambling merchants were trying to bypass our requirement to properly code the transactions."

- Casey Watson
Visa

Visa defines online gambling transactions as transactions that start on the Internet and are approved on the Internet. Online gambling merchants are required to code such purchases with the "7995" merchant category code.

With the 7995 code, the merchant must use a point-of-sale condition code. Before May 22, online gambling Web site operators could use the POS code 59, which represents e-commerce, or either 01 or 08, which represent a mail order/telephone order transaction.

As of the May deadline, the 01 or 08 POS code can no longer be used with 7995. Watson said some online gambling merchants were using the mail order/telephone order codes to cheat the system.

"In the letter, it said that Internet gambling merchants were incorrectly coding a transaction with the 08 or 01 telephone mail order code," she said. "And as a result, those transactions were getting approved because the bank thought it was a mail order/telephone order, but in fact it was Internet gambling. So the mail order/telephone order code is no longer recognized in the Visa system, effective May 22."

Watson said the letter sent to U.S. region banks could not be given to Interactive Gaming News because the information is proprietary and would be used by the banks to communicate with their merchants.

Online gambling transactions that are correctly coded with 7995 and 59 will still be allowed to pass through at banks that allow Internet gambling, Watson said.

"We are recognizing 7995 with the 59 e-commerce code," she said. "We are not recognizing 7995 with a mail order/telephone order code."

Watson said Visa monitors transactions on a monthly basis and will be able to tell in a few weeks whether the change has any impact in the number of online gambling transactions that are attempted.

"Typically we don't see transactions on a day-to-day basis, we have to go month to month to take a look at all the activity," she said. "We'll see in a month where it's happening, but clearly we did see Internet gambling transactions being identified as mail order/telephone order, and they are being approved, and that was brought to our attention because they were being coded incorrectly and it was obvious to us that the Internet gambling merchants were trying to bypass our requirement to properly code the transactions."