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IoM Confirms Online Gambling Safeguards

by Jason Gorringe, Tax-News.com, London

12 May 2011


The Isle of Man's Economic Development Minister Allan Bell has welcomed confirmation of the special safeguards in place to protect the money of customers of online gambling operators licensed in the Isle of Man.

In a statement issued on May 8 the island’s Gambling Supervision Commission said all its current licence holders were complying with the mandatory licensing requirement to keep players’ deposits and winnings separate from the funds used by the operator to conduct its business. This means that any player could withdraw from their gambling account at any time, subject to the normal regulatory checks.

The confirmation is as a direct result of US authorities' ongoing criminal proceedings against Pokerstars - along with two other, non Isle of Man-based companies - after allegedly creating sham payment-processing frameworks to unlawfully provide Internet gambling services to the United States.

Under the terms of the Unlawful Internet Gambling Enforcement Act (UIGEA) of 2006, offshore operators are effectively blocked from access to the lucrative US internet gambling market. Specifically, the Act prohibits gambling businesses from knowingly accepting payments in connection with unlawful internet gambling, including payments made through credit cards, electronic funds transfers, and cheques.

The Manx Gambling Supervision Commission on May 9 stated:

"All Isle of Man licensees must separate their players’ deposits and winnings from the funds that the operator uses for conducting its business. This is a mandatory licensing requirement for Isle of Man online gambling operators."

"The Commission can confirm that all of its current licence holders are complying with these requirements and any players who wish to withdraw money from their gambling accounts should be able to do so at any time subject to the checks required to comply with anti-money laundering, anti-terrorist financing and know-your-customer laws."

"Concerning PokerStars, the Commission can confirm that:

  • PokerStars continues to demonstrate compliance with the above licence condition; and
  • PokerStars is currently offering withdrawals to any players who wish to withdraw their funds, including players in the USA to whom PokerStars does not currently offer real-money gaming."

Minister Bell commented:

"At a time when the world of online gambling is in the spotlight the Isle of Man can provide reassurance that its operators are regulated to the highest standards."

"The Isle of Man government policy is to provide a well-regulated jurisdiction for online gambling businesses and the Isle of Man is recognized as a first class jurisdiction for remote gambling. In pursuit of this policy the Isle of Man offers the strongest possible consumer protection to players, whether they live in the Island, in the UK, or further afield, by requiring that player monies be held separately from a company’s assets in separate bank accounts protected by law – unlike in other jurisdictions - through trust arrangements or bank guarantees."

TAGS: Isle of Man | compliance | business | commerce | law | offshore e-commerce | international financial centres (IFC) | offshore | internet | e-commerce | gambling | licensing | offshore e-gaming | standards

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