Despite UIGEA Exemptions, Banks Likely Won’t Work with States on Online Gaming

By Colby Adams

As some states inch toward legalizing online gambling, they are unlikely to get much cooperation from financial institutions concerned that they'll be held liable for processing even legal bets, say analysts. While federal law doesn't explicitly prohibit online gaming, the 2006 Unlawful Internet Gambling Enforcement Act (UIGEA) requires banks to block bets and payouts outlawed by states. The measure, coupled with the 1961 Wire Act, has pushed most banks into eschewing even legal transactions tied to Internet gaming. Lawmakers in at least 10 states are considering bucking the de facto ban, lobbying for bills that would explicitly legalize online gambling....