While the Unlawful Internet Gambling Enforcement Act of 2006 has wiped out $7 billion in market value of online gambling companies, industry experts believe the ban will not be effective in stopping US punters from gambling online, but that it will just turn them on to overseas payment services out of the US Government\’s reach.
Professor Nelson Rose said the new regulations are clearly going to prevent US banks from doing electronic fund transfers to gambling sites, but that is no big deal and it won\’t by any means wipe out internet gambling.
Punters will simply move their gambling funds to non-US payment processors, such as the widely used NETeller, then transfer the money to the internet gambling sites.
While NETeller announced it will comply with the Act and its related regulations as if it were subject to the Act’s jurisdiction, it also said that until the regulations are implemented, US customers will be able to use the service as normal.
Gaming law specialist Anthony Cabot thinks language used in the Act provides a loophole for the payment processors and the US banks to continue to do business together.
The ban is also expected to drive bettors toward smaller companies that pose more risks to players\’ funds.
“There are privately owned operators that will continue to take play as long as they have payment processors that will work with them,” said Sue Schneider, President of River City Group.
Gambling consultant Sebastian Sinclair says internet gambling will face a serious setback but it will eventually recover.
“There will be a big hit to the industry. But it\’s not going to be long term, it\’s transitory until somebody finds a solution to whatever roadblocks are put in their way. There\’s too much money for it to go away,” he said.
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