USA May Enact New Regulations Tracking Electronic Funds Transfers

New proposals to track international electronic funds transfers have American poker players worried about the impact on online poker and gambling.

The new Treasury Department proposal would require banks to make weekly reports on any electronic money transfers that moved into or out of the United States. Previously, the only reporting requirements were on transactions of $10,000 or more. The new regulations would make it easier for the United States to track transfers tied to money laundering or terrorist activities, but they would also likely cause a larger crackdown on Internet gambling transactions.

“By establishing a centralized database, this regulatory plan will greatly assist law enforcement in detecting and ferreting out transnational organized crime, multinational drug cartels, terrorist financing and international tax evasion,” said Director James Freis Jr. of the Financial Crimes Enforcement Network, a subdivision of the Treasury Department.

According to estimates, these new rules would cost about $33 million dollars to put into place.

Due to UIGEA regulations, banks and other financial institutions are responsible for preventing transactions between online gambling sites and players from the United States. However, most banks have said it would be either impossible or impractical for them to monitor all of these transactions. Since many of these transactions are rather small, it would require a large amount of effort to figure out which transactions were legal and which were not. In addition, there are specific exceptions to the law for forms of gambling such as horse racing that make practical applications of the law difficult.

It should be noted that current US regulations – as well as this proposed change – do not make online poker illegal in the United States. The new regulations would, however, make transferring money to and from online gaming accounts more difficult than they already are, since enforcement would be simplified due to the centralized database.