When the UIGEA was passed in 2006 as an attachment to the Safe Port bill, I wrote an article expressing disgust that the government would sink so low as to attach a gambling bill to one designed to protect the country from terrorism. I received an email response from a politician (Democrat by the way); claiming that my article wasn’t well thought out because gambling and terrorism indeed were related. The politician stated that terrorists can use online gamblingsites to launder money so the connection was reasonable.
That same logic was laid out in 2002 by Assistant Attorney General John Malcolm at a conference in England as well. These were his comments:
“A major concern that the Department of Justice has about online gambling is that Internet gambling businesses provide criminals with an easy and excellent vehicle for money laundering, due in large part to the volume, speed, and international reach of Internet transaction and the offshore locations of most Internet gambling sites, as well as the fact that the industry itself is already cash-intensive.
It is a fact that money launderers have to go to financial institutions either to conceal their illegal funds or recycle those funds back into the economy for their use. Because criminals are aware that banks have been subjected to greater scrutiny and regulation, not surprisingly, they have turned to other non-bank financial institutions, such as casinos, to launder their money. On-line casinos are a particularly inviting target because, in addition to using the gambling that casinos offer as a way to hide or transfer money, casinos offer a broad array of financial services to their customers, such as providing credit accounts, fund transmittal services, check cashing services, and currency exchange services.
Detailed report link: click here