The US Department of Treasury and Federal Reserve announced a joint rule this week to implement and enforce the Unlawful Internet Gambling Enforcement Act. The rule relies on financial institutions performing due diligence on corporate customers to ensure they’re not processing online gambling transactions. American financial institutions have been given until December 1, 2009 to comply with the regulations designed to block online gambling transactions…

Washington (Reuters) – The U.S. Treasury Department and the Federal Reserve issued a final rule on Wednesday aimed at stopping illegal Internet gambling, two days after a leading Democratic lawmaker called for a delay because of the problems he said it would cause for banks. The regulation pleased Republican lawmakers, who still controlled the Congress in 2006 when it passed the Unlawful Internet Gambling Enforcement Act.

Rep. Barney Frank (D-Mass.) has asked Treasury Secretary Henry Paulson to postpone issuing regulations opposed by banks and other financial groups that would implement a ban on Internet gambling. The “midnight rulemaking” would “tie the hands of the new administration, burden the financial services industry at a time of economic crisis and contradict the stated intent of the Financial Services Committee,” Frank wrote in a letter to Paulson and Ben Bernanke, the chairman of the Federal Reserve.

The Treasury Department and the Federal Reserve continue to finalize a new rule that would put the onus on banks to help crack down on online gambling by US citizens, a Treasury official said Wednesday. In prepared remarks, Deputy Assistant Secretary Valerie Abend said banking regulators are focusing their efforts on banks that do business with gambling companies, as well as the interaction between US banks and foreign banks that may be tied to online gambling.