WASHINGTON (1/2/08)—Sixteen House Republicans wrote to the Treasury Department and Federal Reserve Board recently warning that their joint proposal to implement a 2006 ban against most forms of Internet gambling could have major unintended consequences for financial institutions and credit card companies. Led by Rep. Pete Session (R-Tex.), the House members wrote that the proposal was overly broad and does not give clear and consistent guidance to the regulated entities charged with blocking Internet gambling transaction. (CongressDaily Dec. 20). The Unlawful Internet Gambling Enforcement Act, signed into law Oct. 13, 2006, prohibits financial institutions and credit card companies from processing payments associated with online gambling. Under the law, banks and credit card companies are prohibited from processing payments for online bets. Businesses that accept credit cards, wire transfers or any other bank instrument to process those payments could be prosecuted. The Credit Union National Association (CUNA), as reported earlier, also has expressed reservations about the joint agency proposal, warning it threatens to impose an "unforeseen regulatory burdens" on credit unions and other financial institutions. CUNA President/CEO Dan Mica recently wrote House Financial Services Chairman Barney Frank (D-Mass.) asking for a moratorium on the law's implementation until "a more reasonable approach can be considered by Congress and the regulators."
WASHINGTON (1/2/08)—The Treasury Dept. has kicked off its sixth round of competition for Its New Market Tax Credits (NMTC) program, making $3.5 billion of equity investments available to qualified credit unions and other applicants. The NMTC program is administered by Treasury Department's Community Development Financial Institutions (CDFI) Fund. The program attracts private-sector capital investment into the nation's urban and rural low-income areas to help finance community development projects, stimulate economic growth and create jobs. The NMTC allows individual and corporate taxpayers to receive a credit against federal income taxes for making qualified equity investments in investment vehicles known as Community Development Entities (CDEs). The CDFI reports that the program to date has made 294 awards equaling a total $16 billion in allocation authority. According to a Federal Register document submitted by the Treasury, parties interested in applying under the NMTC program that are not yet CDE designated must apply for certification by Feb. 6. While credit unions are eligible for CDE designation, to date many have found a costly application process and other factors have kept them out of the competition for the credits. Applications for tax-credit allocations must be submitted electronically by March 8. Use the resource link below for more NMTC information.