In the wake of a legal settlement between a California resident and MasterCard International regarding the enforceability of Internet gambling debts, MasterCard has announced that its planning to implement a new set of rules governing Internet casino transactions.
The rules will provide all parties to a gambling-related Internet transaction with notice to consider any legal issues that may arise as a result of the transaction. Included is a requirement for Internet casino merchants to post a notice on their web site indicating that gambling may not be lawful in some jurisdictions and advising people to seek clarification, as well as requiring merchants to ask prospective gamblers where they are located (both in the US and abroad) and to record responses. The rules also specify that card issuers are to be notified about gambling transactions and such transactions will be coded.
The new rules are as follows:
- A requirement that Internet casino merchants, as a condition to having a MasterCard merchant account, post a notice on their web site. The notice must state it has been asserted that Internet gambling may not be lawful in some jurisdictions, including California, and that the consumer should ascertain whether Internet gambling is legal under applicable law.
- A requirement that Internet casino merchants ask prospective gamblers to identify the state or foreign country where they are located, and maintain a record of such responses.
- A provision for card issuers to receive notice of Internet gambling transactions, as new operational rules will require these transactions to be coded to indicate the nature of the transaction.