Highlights:
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UIGEA was enacted to prohibit institutions from accepting payments from any person engaged in the business of betting or wagering with a business in unlawful Internet gambling.
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Provisions of UIGEA prohibit the acceptance of payments relating to bets or wagers involving use of the Internet if those activities are unlawful under applicable law.
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UIGEA defines a "participant" as "an operator of a designated payment system, a financial transaction provider that is a member of or, has contracted for financial transaction services with, or is otherwise participating in, a designated payment system, or a third-party processor." The term "participant" does not include a participant's customer unless the customer is also a financial transaction provider participating on its own behalf in the designated payment system.
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A joint rule issued by the U.S. Department of the Treasury (31CFR 132) and the Federal Reserve Board (12 CFR Part 233 – Regulation GG) states that the following five payment systems are covered by UIGEA: automated clearing house systems, card systems, check collection systems, money-transmitting businesses, and wire transfer systems.
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Financial institutions should develop and implement policies and procedures, as appropriate, to ensure that transactions of this nature are not accepted.
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Attached are an overview of UIGEA, a chart identifying the designated payment systems and requirements of participants, and examination procedures related to this rule.
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Compliance with the rule was required as of June 1, 2010.
Distribution:
FDIC-Supervised Banks (Commercial and Savings)
Suggested Routing:
Chief Executive Officer
BSA Compliance Office
Related Topics:
Bank Secrecy Act/Anti-Money Laundering (BSA/AML) Programs
Attachment:
Unlawful Internet Gambling Enforcement Act Overview and Examination Procedures - PDF (PDF Help)
Contact:
Anti-Money Laundering Specialist Marie Edwards at
SASFIL@FDIC.gov or (202) 898-3673
Printable Format:
FIL-35-2010 - PDF (PDF Help)
Note:
FDIC Financial Institution Letters (FILs) may be accessed from the FDIC's Web site at http://www.fdic.gov/news/news/financial/2010/index.html
To receive FILs electronically, please visit http://www.fdic.gov/about/subscriptions/fil.html.
Paper copies of FDIC FILs may be obtained through the FDIC's Public Information Center,
3501 N. Fairfax Drive, Room E 1002, Arlington, VA 22226 (1-877-275-3342 or 703-562-2200).
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