Securing a high risk merchant account can be difficult enough, but even more so for online casino businesses. Although it is legal to operate an online gambling website, finding a bank that will approve credit card processing for online casino card games can be a challenge.
The online gambling industry including casino style games, online poker, and even the sale of lottery tickets is no longer regulated by The Federal Wire Act, but banks are still hesitant to provide merchant services to these types of businesses.
The Transaction Group (TTG) specializes in providing high risk merchant account solutions. If you are in need of a merchant account for your online gambling or gaming website, contact us below.
A Brief History of Online Gambling and The Federal Wire Act:
With its introduction in 1961, The Federal Wire Act prohibited certain businesses from operating in the U.S. This law made it illegal for anyone to transmit sports bets or wagers via wire communication and imposed a sentence of up to two years in prison for convicted violators.
As the Internet became mainstream in households throughout the U.S. and the world, online casinos started popping offering gambling on their websites. These websites utilized offshore banks for handling credit card processing for online casino card games.
For years, the Department of Justice’s criminal division sought to shut down these operations, arguing that the Wire Act’s reach also included all online gambling businesses in which U.S. players receive money for online poker winnings.
In 2008, the co-founder of the gambling website PartyGaming plead guilty to violating the Wire Act for operating his online poker site from 1997-2006. He was sentenced to 1 year probation and agreed to pay $300 million in fines.
It became clear in 2011 that the Federal Government was steering away from the interpretation that online poker violated the Wire Act. Also in 2011 the U.S. Attorney for Manhattan filed a $3 billion civil lawsuit against huge players, FullTilt and PokerStars, claiming not that these companies violated the Wire Act, but rather, the Unlawful Gambling Enforcement Act.
In December 2011 the Federal Government released a statement on their new position; that the Wire Act now only applies to sports wagering. The new position may be a huge boost to individual states that allow gambling. States may see increased revenue through the online sale of lottery tickets and through state-run online casinos.
If your business is in need of credit card processing for online casino card games, The Transaction Group (TTG) can help. At TTG, we provide solutions to all types of gambling and gaming websites, including merchant accounts for online lottery tickets.