New York Attorney General Eliot Spitzer announced today that ten national and regional banks have promised his office they will no longer accept Internet gambling transactions from New Yorkers.
Spitzer said in a press release today that his office is commending all ten banks for their assistance in ending an activity that has "enabled gamblers to wreak sudden financial devastation on themselves and their families."
"This is a turning point in the credit card industry," he said. "The vast majority of credit card issuers -- and all issuers doing significant business with New York consumers -- have now recognized their legal, ethical and business obligation to block credit card transactions identified as online gambling."
Today's announcement follows the settlement that Spitzer's office reached with Citibank last June. The agreement requires Citibank to block all of its cardholders from making online gambling transactions. The company also said it would make a $400,000 donation to charities that support people who suffer from gambling addiction.
The ten banks included in today's announcement are:
- Cayuga Bank, based in Auburn, N.Y. (now First Niagara Bank)
- Chemung Canal Trust Co., based in Elmira, N.Y.
- First Consumers National Bank, based in Beaverton, Ore.
- First Premier Bank, based in Sioux Falls, S.D.
- Merrick Bank, based in South Jordan, Utah
- Peoples Bank, based in Bridgeport, Conn.
- Trustco Bank, based in Schenectady, N.Y.
- USAA Federal Savings Bank, based in San Antonio, Texas
- US Bank NA, based in Fargo, N.D.
- Wells Fargo Financial Bank, based in Des Moines, Iowa
A spokesman for the Attorney General said Chemung Canal Trust Co., Cayuga Bank and Trustco Bank are all regional, New York banks and that the others on the list are national banks.
In addition to promising to block online gambling transactions, the ten banks also agreed to pay a collective total of $335,000 to the state of New York. According to the press release issued by the Attorney General's office, the banks will only be required to block online gaming purchases made by people in the state of New York. However, Spitzer said he expects that the banks will carry over that practice to their operations in other states.
Spitzer's spokesman told Interactive Gaming News that the Attorney General hopes all other credit card companies with cardholders in New York will also agree to block Internet gaming transactions.
"I'm not anticipating anything tomorrow, but it's always a possibility," the spokesman said.
Wells Fargo Financial Bank is a subsidiary of Wells Fargo Financial, which is in turn a subsidiary of Wells Fargo Bank.
Judy Corcoran, the director of communications for Wells Fargo Financial, told Interactive Gaming News that her group serves only a small, "niche" population of people and is separate from Wells Fargo and Co. and that group's primary credit card operation.
"We only have 16,000 (credit card) customers in the whole state of New York," Cocoran said. "We had just minimal, infinitesimal usage of the card program for Internet gambling. If we're not the smallest, I think we're the second smallest (company) in the settlement."
Wells Fargo Financial Bank has 500,000 credit card users in the country and has blocked online gambling transactions since September, Corcoran said.