News agencies in the USA report that the Independent Community Bankers
of America (ICBA) has again called on Congress to re-examine provisions
in the Internet Gambling Prohibition and Enforcement Act (H.R. 4411)
recently passed by the House of Representatives that require banks
and other financial institutions to assist in halting the flow of
gambling deposits to online gambling venues.
ICBA spokesmen said that the measure could greatly over-burden the
nation's payment system....and monitoring the payments made to gambling
interests may be impossible.
"ICBA recognizes the concerns that some of your colleagues
have raised about Internet gambling," ICBA wrote in a
letter to Senate Banking Committee Chairman Richard Shelby and Senate
Judiciary Chairman Arlen Specter. "We urge Congress to
recognize that the nation's banks have already taken on major responsibilities
to help detect and prevent terrorist financing and illegal money laundering.
Attempting to monitor and block gambling transactions, particularly
given the limits of the current payment technology, could detract
from those efforts."
The letter, which is available to the public at www.icba.org, goes
on to protest that the proposed law creates an impossible compliance
burden for "uncoded" transactions. Unlike credit card transactions,
which include a code that identifies the type of business receiving
payment, uncoded transactions (electronic payments and personal checks)
don't provide this information. While it's possible to monitor and
block certain types of credit card transactions, a bank cannot do
so with uncoded transactions.
ICBA is also concerned that the law appears to threaten to subject
banks and electronic processors to potential criminal liability for
routine processing of financial transactions - their core business
operation, and that it could subject banks to inconsistent state and
national standards.
Through the USA Patriot Act and Bank Secrecy Act ICBA has cooperated
in confirming the identity of bank customers while documenting and
reporting suspicious transactions, and the banks prefer to continue
to focus resources where risks to national safety and financial soundness
are greatest.
The communication concludes by pointing out that the burden of regulation
and compliance created by H.R. 4411 is substantial, and if enacted,
would require banks to identify and block transactions between bank
customers and Internet gaming companies on a system not designed for
this purpose.