PokerStars Survives Black Friday
Nine months after the US Government aimed to shut down the big 3 poker sites and the dust is finally settling, PokerStars is the only real survivor. Of course PokerStars had to shut off service to their US players, but at least all US players were paid back their account balances.
The founders of PokerStars, Full Tilt Poker, and Absolute Poker/UB have gotten into a very sticky situation. On Black Friday, an indictment was put against the founders of online poker’s “big three” on charges of money laundering, bank fraud, and illegal gambling. Restraining orders were also placed against five of their internet domains and 75 bank accounts used by the poker companies and their payment processors.
The charges placed on the poker founders are based on two acts the illegal Gambling Business Act of 1955 and the Unlawful Internet Gambling Enforcement Act of 2006 the same charges that had previously been brought against payment processors resulting in their shut downs. This has become a very complicated global legal battle between the U.S. Department of Justice and founders of the US poker sites who argue that their operations within the U.S. do not violate the law.
The press release on the indictment released by the U.S. Department of Justice, named the 11 defendants: Isai Scheinberg, Scott Tom, Brent Beckly, Raymond Bitar, Nelson Burtnick, Paul Tate, Bradley Franzen, Ira Rubin, Chad Elie, and John Compos. Scheinberg and Tate are indentified as representing the site PokerStars, Tom and Beckley of representing Absolute Poker, and Burtnick and Bitar of reprisenting the site Full Tilt Poker, while Franzen, Elie, and Rubin are the ones who allegedly ran their payment processors.
The main allegations brought upon the poker companies are the alleged fraudulent methods they use, and at least $3 billion from the defendants is being sought for money-laundering penalties.
“As charged, these defendants concocted an elaborate criminal fraud scheme, alternately tricking some U.S. banks and effectively bribing others to assure the continued flow of billions in illegal gambling profits. Moreover, as we allege, in their zeal to circumvent the gambling laws, the defendants also engaged in massive money laundering and bank fraud. Foreign firms that choose to operate in the United States are not free to flout the laws they don’t like simply because they can’t bear to be parted from their profits,” said by Manhattan U.S. Attorney Preet Bharara.