Banks Sued Over Net Bet Debt

19 May 2000
MasterCard International Inc., American Express Co., and banks such as Chase Manhattan Corp. and MBNA America Bank, have engaged in illegal bookmaking operations by allowing customers to amass credit card debts at illegal on-line casinos, a series of lawsuits allege.

Gamblers who used credit cards to wager $60 to more than $10,000 at offshore casinos claim in 10 lawsuits filed in federal court that MasterCard, American Express and 10 other financial institutions are aiding illegal offshore betting parlors and should be barred from collecting the gambling debts.

The plaintiffs seek class-action status. Their complaints, filed this week in New York, are the latest in a series of similar lawsuits against MasterCard, Visa International Inc., and dozens of banks, all of which are pending in federal court in New Orleans.

The newest suits, which will be transferred to New Orleans, are the first to name American Express and the 10 banks. "MasterCard's association with Internet casino gambling enterprises is integral to the functioning of Internet gambling in the United States [and] would be difficult, if not impossible, to accomplish," without the cooperation of credit card companies, the suit said.

The suits contend the casinos are violating U.S. telephone and wire laws against unregulated gambling and that the credit card companies are aiding the casinos. The plaintiffs have asked the court to declare their gambling debts void. The other banks named in the complaints are Fleet Bank NA Rhode Island, Central Carolina Bank & Trust Co., People's Bank Corp., Bank of America NA, Citibank NA, Citigroup Inc., and First USA Bank.