Just in the nick of time, word has escaped from highly-placed sources in the financial community that the US Treasury will postpone enactment of the UIGEA rules concerning online gambling payment processing.

With only days left before the implementation of the UIGEA rules, sources within the financial services industry are saying that the December 1st compliance date for blocking online gambling payments will be delayed another six months. According to a report by PocketFives, a site for online poker players, a formal announcement of the decision to suspend implementation will be forthcoming from the Treasury.

The UIGEA rules were crammed onto the executive calendar as a set of midnight rules, being placed on the itinerary exactly one day before the incoming administration of Barack Obama would have had say-so over the online casino block. Companies were given a year to construct mechanisms to comply with the law, which makes processing payments for illegal Internet gambling against the law.

But the UIGEA did not define what constituted illegal gambling, and federal law leaves much open to opinion as to what is proscribed. The result has been blocking of online gaming transactions clearly intended to be allowed via written exemptions in the UIGEA, such as state lotteries and horse racing, while financial companies reject all gambling as potentially dangerous legally.

Nineteen Congressmen, led by online casino hero Barney Frank, implored the Treasury and Federal Reserve to give Congress more time to address the flawed legislation, sending a written letter to Secretary Tim Geithner and Chairman Ben Bernanke. Anti-gambling factions responded with a letter from Senator Jon Kyl and Representative Spencer Bachus, demanding the schedule be followed.

But this week, the entire Kentucky delegation to the House of Representatives, a bipartisan group of four Republicans and two Democrats, asked again for a delay, citing unwanted blocking of online gambling on horse racing.

Formal proclamation of the suspension of UIGEA implementation is expected Friday or Monday, averting the Tuesday deadline with hours to spare.

Published on November 25, 2009 by JoshuaMcCarthy

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