Argentina blocks purchase of casino chips and online sites with credit cards

In Uruguayan casinos as well as in other faraway destinations, Argentinian tourists managed to obtain foreign currency through a simple method. Buying chips with credit card at the official exchange rate up to June last year and with a 15% charge on account of capital gains tax since last July, and then redeeming them at the cash desk without gambling, obtained cash currency at an unbeatable exchange rate, without asking for the requested authorization of the Internal Revenue Service (AFIP) in Argentina.

Sources of the Central Bank explained that the aim of the measure is to “hinder disguised exchange transactions and comply with FIU norms regarding money laundering prevention.”

As these operations cannot be banned legally, what the Central Bank will demand now is that financial entities and issuers of local cards request an authorization to the entity before initiating these transactions, a request that will probably be denied.

According to sources of the Central Bank to official news agency Télam, “it is not reasonable that, through the use of local cards, residents have the chance to evade the norms on exchange regulation”. And, to explain the measure, they appealed in part to reports from the  Financial Action Task Force on Money (FATF)– intergovernmental entity to combat money laundering–, which warned about the fraudulent use that is usually made of this type of operations.

The new restriction, which was written in the report A 5405 of the Central Bank, took the market by surprise, which was really expecting some type of measure related to the acquisition of tourist packages and air tickets abroad.