Eliot Sptizer, New York Attorney GeneralCitibank, one of the largest credit card companies in the U.S., in June joined the growing list of banks blocking online gambling transactions, following an investigation by the New York State Attorney General’s office. The Attorney General (AG) sent out a press release regarding Citibank’s decision, but it didn’t do much to explain why it came about or the problems it will cause.
To understand how things got where they are now, you have to go back a few years. Eliot Spitzer became New York Attorney General on January 1, 1999 and since then the Harvard Law School graduate has worked diligently to enforce the state’s anti-gambling laws. (All forms of gambling except a state lottery and pari-mutuel horse wagering are illegal in New York.) In that time, Spitzer successfully prosecuted online gambling cases against Jay Cohen and World Interactive Gaming Corp.
The New York Supreme Court also ruled in 1999 that New York’s anti-gambling laws could be applied to offshore Internet wagering sites, which meant that Spitzer could do what he saw fit to prevent online wagering, or eliminate any way of facilitating online wagering – such as credit cards – in New York. Which brings us back to Citibank.
Christine Pritchard, spokesperson for the Attorney General’s office, says that the AG launched an investigation into Citibank’s online gaming transaction policy rather than chasing overseas casino companies that might be difficult to prosecute, and “brought to [Citibank’s] attention that not only are there civil implications but that there are criminal implications in New York state for ‘knowingly advancing or profiting from unlawful gambling activity.'” That investigation was directly responsible for an agreement between the parties and Citibank’s decision to block these transactions.
Maria Mendler of Citibank believes the bank had two compelling reasons for …