Senators say Proposed UIGEA Regs Require Further Guidance

Earlier this month Republican Senators John Sununu of New Hampshire and Pete Domenici of New Mexico co-signed a letter to the heads of the U.S. Treasury and Federal Reserve urging that proposed banking regulations for the Unlawful Internet Gambling Enforcement Act (UIGEA) be supplemented with further guidance.

"The October Notice of Proposed Rulemaking . . . leaves sufficient ambiguity as to what sort of transactions are to be blocked," the Senators wrote. "In failing to provide more detail, the proposed rules would inordinately burden every bank, credit union, credit card company, money transmitting business and payment system in the country."

A total of 126 organizations responded when the Fed and Treasury opened the regulations up for public comment between October 1 to December 15, including the U.S. Chamber of Commerce, The Electronic Check Clearing House Organization, The State Department Federal Credit Union and The North American Association of State & Provincial Lotteries.

The Senators suggest that the "extensive" number and breadth of public comments indicate that "institutions will simply choose to block every transaction that may be interpreted or could resemble gambling, whether legal or not."

The letter concludes: "We urge that any final rules contain a list of restricted transactions and instances that are covered by the law and the corresponding rules.

"As an alternative, we suggest you consider separating the rules into those forms of activities for which there is settled federal law (i.e., defined by the Professional and Amateur Sports Protection Act (PAPSA) and those that are not."

Click here to view a copy of the letter.