Will Legal US Online Gambling Payments Be Blocked By VISA?
21st May 2013
How has credit card company VISA reacted to handling online betting payments in the three US states to have legalised Internet gambling so far?
Despite the recent legalisation of Internet gambling in Nevada, New Jersey and now Delaware, the federal law restricting online payments by financial institutions including credit card companies is still in force. Yet credit card deposit remains the most popular method of balance transfers to Internet casino and poker room accounts for players.
UIGEA Still In Force
Since the unpopular and controversial bill to make online gambling unlawful in the United States, the Unlawful Internet Gambling Enforcement Act (UIGEA) was passed into law in 2006, financial firms have been required to block all payments associated with Internet poker room and casino accounts. This has made credit cards one of the least favoured methods of deposit payment into those accounts where the card is registered to a US based card issuing bank.
However, this doesn't seem to have stopped the practice, since many big name operators that accept US players are still able to process transactions made with US credit cards. But now the game has changed with the recent changes in the gambling laws of Nevada, New Jersey and Delaware, what is being done by the major credit cards to differentiate between legal and illegal payments?
Proving Legal Status
VISA has its own system of blocking gambling payments from online operators which can distinguish between payments that are legal and those that are illegal. It works by integrating with VISA's own Merchant Verification Value Registration Program (MVV) which requires Internet based casinos to submit proof they are operating legally if they wish to provide players with the option of making deposit payments using VISA cards.
Those proofs include:
1. A legal certificate demonstrating compliance with all applicable federal laws in addition to those imposed by the respective state
2. Independent third-party certification proving the online casino has in place adequate systems and controls to ensure online gambling operations will keep within the lawful limits
In addition to providing the above proofs of legal gaming, the operator also has to pay up the registration fee of $5,000.
If the gaming operator has fulfilled its requirements and proofs of legal activity, then VISA will process payments for Internet casinos run by that operator. This is a significant step forward for the industry in the US and a milestone for other states considering the legalisation of gambling via the Internet.
