Credit Card Headaches for US Regulated Online Gambling
Regulated online gambling in the US may be in full flow in three states now, however it's not all quite going as planned in one of the major areas, that of credit card processing. For any online gambling company, getting money on and off the site is of course one of the key areas and players need to both deposit and withdraw their winnings. It seems however that many US banks and financial institutions are simply not playing ball and problems with depositing by credit cards are being reported in New Jersey, Nevada and Delaware.
Major US credit card issuers Wells Fargo, American Express and J.P Morgan Chase will not allow their cards to be used when attempting to deposit into an online casino or poker room that is regulated in the US. Sanette Chao of American Express stated that the company, "prohibits the use of the card for gambling services," and Steve O'Halloran of Chase Morgan similarly said that, "We don't allow credit card transactions for this activity." Natalie Brown at Wells Fargo does however explain a little more in saying that, "In compliance with regulation GG (Unlawful Internet Gambling Enforcement Act of 2006), we prohibit the use of consumer credit cards for Internet gambling." So in essence all financial institutes that have allowed players to deposit by credit card into an online gaming company are in breach of a federal law, that of UIEGA? It does open a can of worms in that the badly worded law has made little sense from day 1, and now makes even less sense.
Regulated gaming companies are stating that there are other ways to deposit, for example to play real money poker at Ultimate Poker in Nevada you may deposit in cash at any Station Casino, however that does somewhat defeat the object of playing in an online casino or poker room. WSOP.com operating in both Nevada and New Jersey are facing the same issue and Seth Palansky has said that, "You wish everything went smoothly, it's not the reality, it's a new business."
The declines in credit card transactions are prohibiting the growth of the fledgling industry and the harm done by rejected deposits is often irreversible. Many players will simply not try again, simply believing that, oh well, my card doesn't work with them, never mind. Joe Pappano the GM of Vantiv Gaming Solutions believes that there will be a turn around by the banks and that they will begin accepting credit card transactions, and says that banks have to be educated, stating, "You have to remember that it's only been legal for about 7 months." He also said that banks must be told that using a credit card to deposit into online gaming companies is just like any other form of online shopping, however banks, politicians and companies involved must get together and find a way to make it happen.