UIGEA Effecting Offshore Banks

The effects of the Unlawful Internet Gambling Enforcement Act (UIGEA) of 2006 are already being felt by financial institutions and online gaming operators alike, even though the guidelines for the law, now two weeks past-due, have not been established. According to reports in The Antigua Sun, many online gaming companies on the Caribbean island nation of Antigua and Barbuda have been notified that their accounts will be terminated.

In an interview with the local paper, Ron Maginely, former gaming director for Antigua and Barbuda, said, ""I was informed by a couple of gaming companies that some jurisdictions have already started to close gaming accounts." The Isle of Man recently notified gaming companies that all gaming-related accounts will be closed.

"Under the law here, gaming companies are required to put 'gaming' in their names and in relation to getting accounts, certainly the local banks here are showing reluctance to offer new accounts, even to companies registered here." Maginely reported. "That is made even worse internationally where a number of banks are simply refusing to either continue providing or to provide new accounts to gaming companies.

"Because the US legislation makes US banks criminally liable for facilitating gaming companies, you can have a situation where even domestic banks, because thy are concerned about the loss of corresponding accounts, are forced to close local gaming accounts."

For obvious reasons, a gaming company cannot function properly without the ability to facilitate monetary transaction through a bank.

Antigua and Barbuda's current director of gaming, Kay McDonald, was contacted on the matter, but expressed that she was unaware of any hesitancy on the part of local banks to open or continue service to online gaming operators.