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Compliance Internet gambling rules take effect June 1
WASHINGTON (5/5/10)--The Credit Union National Association has confirmed with Federal Reserve Board staff that the Unlawful Internet Gambling Enforcement Act (UIGEA) regulations are on track for mandatory compliance on June 1. The Fed and the U.S. Treasury pushed back the compliance date from Dec. 1, 2009 to June 1, 2010 just days before credit unions were originally scheduled to comply with the new requirements. However, no additional delays are on the horizon. The rules require credit unions and other financial institutions to establish and implement policies and procedures to identify and block restricted internet gambling transactions, or rely on those procedures established by the payments system. “Generally speaking, credit unions must have policies and procedures in place that demonstrate that they are exercising enhanced due diligence when opening business accounts to prevent illegal Internet gambling operations from setting up accounts at the credit union,” says CUNA director of compliance information Valerie Moss. “Credit unions must also have policies and procedures to prevent credit/debit card transactions from being made to unlawful Internet gambling operations – this applies to all accounts, not just business account owners,“ she added. The regulations designate payment systems that could be used in connection with a restricted Internet gambling transaction: automated clearing house (ACH) systems, card systems, check collection systems, money transmitting businesses, and wire transfer systems. Participants in card systems and money transfer business operators are covered by the rule. Many participants in ACH systems, check collection and wire transfer systems are exempt from the rule. However, the exemptions are complicated and contain a number of exceptions. Therefore, most credit unions are impacted by the rules to some extent, said Moss. For CUNA’s e-Guide to the internet gambling rules, use the resource link.


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