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Checks as Casino Payment Option

By: Fabian Rictor, Friday May 14th 2010
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The process of making and receiving payments by checks would be familiar to everyone. But today even in the brick and mortar world this option is getting less popular. Hence it has even less worth in the virtual world of online casinos. However it is listed as one of the payment options and therefore merits discussion.

Most online casinos do not accept deposits through checks. Checks have to accounted for manually, have to be physically deposited at banks and watch has to be maintained to ascertain when they have cleared. With the cost of labor and time being what it is this process has become uneconomical. Even if some online casinos accept payments by checks, players at those casinos are not inclined to make deposits using checks. The charges levied by online casinos are steep and it can take up to 10 days for the payment to reach the casino and the player cannot wager meanwhile. Hence making deposits at online casinos using checks would be very rarely, if ever, used.

Players still receive their payouts using checks. There is a reason for this despite the same problems of time delays and manual effort. Many credit cards do not allow players to take withdrawals into their card accounts. Therefore if players have deposited funds using those credit cards then withdrawals have to be made using checks. Also players who have used prepaid cards or vouchers to deposit funds at online casinos are constrained to accept withdrawals through checks. Only those players who have deposited funds using electronic wallets can withdraw funds to the same electronic wallets and need not accept payments through checks.

Online casinos rarely process the check payments in house. This function is outsourced either to a fully owned subsidiary or to an independent processor. The online casino transfers the total amount to be remitted to the account of the payment processor and provides the details of what amounts are to be paid to whom. The checks are then issued by the payments processor.

This system works well where online gambling is legal such as in some European countries and the United Kingdom. Everyone, including the involved banks, knows that the processor is receiving the funds from online casinos and remitting amounts to players. However in countries where online gambling is illegal this system is running into difficulties. For example in the United States the onus has been put on banks for preventing transactions from and to online casinos. Therefore the processor cannot declare to the banks that the funds are remittances from online casinos to their players. The processor has to give a wrong declaration like he is processing payroll payments. This raises the risk level. Also the online casino remits the funds to the processor outside the United States and the processor transfers the funds to his account in the United States and makes payments to players from that account. This further raises the risk level. In the last one year several processors have been caught by the federal law enforcement agencies.

Checks is as it is not an attractive option and will become less attractive in countries where online gambling is illegal because it is more likely to come under the scanner.

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Comment by: Scott Peters On: June 03, 2010
Yeah not really sure exactly myself either but I do beleive that there can still be some liability on the part of the banks with regards to checks that are clearing that are known to be going to online casinos. I beleive that the bigger issue is that many online casinos are no longer able to accept withdrawal requests from players via check as a payment method then being able to take money in from players via check.
Comment by: Rufus Boyd On: June 02, 2010
It is my understanding that banks in the U.S. cannot act as policemen in determining the source of checks that are being deposited their only goal is to insure that the check is valid, and that the account on which the check is drawn has sufficient funds to cover the check. The law that just took effect(UIGEA) requires banks to monitor and prevent electronic withdrawals from U.S. bank accounts to online casinos via the bank's debit card. It does not require banks to monitor check deposits. Could I be mistaken?
Comment by: chowderman On: May 21, 2010
I disagree and think that checks are still a very viable option to make payments to players at online casinos. Sure they're not the fastest but for larger withdrawals it makes sense either that or by wire transfer.
Comment by: Darren Arbchild On: May 17, 2010
Check IMO is a good online banking option to avoid as much as possible if you can!
Comment by: singlemom On: May 16, 2010
Check withdrawals aren't super reliable the electronic methods are more reliable and ensure that when the funds are received that they are cleared and that they are in your account. Also eWallet type solutions work quite well too.

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