WASHINGTON — The Treasury Department and the Federal Reserve are giving U.S. financial institutions an additional six months to comply with regulations designed to ban Internet gambling.
The two agencies said Friday that the new rules, which were to take effect Dec. 1, would be delayed until June 1.
House Financial Services Committee Chairman Barney Frank, D-Mass., a key opponent of the ban on online gambling, praised the action and said it would give Congress time to overturn a law passed in 2006 when Republicans controlled Congress.
The delayed rules would curb online gambling by prohibiting financial institutions from accepting payments from credit cards, checks or electronic fund transfers to settle online wagers.
The financial industry complained that the new rules would be difficult to enforce because they did not offer a clear definition of what constitutes Internet gambling. They had sought a 12-month delay in implementing provisions of the Unlawful Internet Gambling Enforcement Act that Congress passed in 2006.
The Bush administration issued regulations to enforce the law in November 2008 and had set Dec. 1, 2009, as the date financial institutions would have to begin complying.
However, in a joint notice Friday, Treasury and the Fed said that several members of Congress had sought a delay, arguing that there was considerable support for new legislation to clarify the current laws.
The two agencies said groups seeking a delay had provided sufficient reasons to justify a limited six-month postponement of the rules. Financial organizations supported gambling industry associations seeking a delay.
U.S. bettors have been estimated to supply at least half the revenue of the $16 billion Internet gambling industry, which is largely hosted overseas.
