The War on Online Poker has officially begun. The United States Department of Justice on Friday unsealed an indictment against 11 defendants, including the founders and owners of Full Tilt Poker, PokerStars, and Absolute Poker. In addition, five web domains were seized.
The indictment named the following people as defendants in the case:
- PokerStars founder and owner Isai Scheinberg
- Full Tilt Poker founder and owner Raymond Bitar
- Absolute Poker and UltimateBet co-founders Scott Tom and Brent Beckley
- Part owner of SunFirst Bank, John Campos
- Former head of payment processing for PokerStars, Paul Tate
- Former payment processing executive for both PokerStars and Full Tilt, Nelson Burtnick
- Others involved in payment processing scams were Bradley Franzen, Ira Rubin, Ryan Land, and Chad Elie
The DOJ brought the 11 defendants up on five charges covering nine counts. The charges are as follows:
- Conspiracy to Violate the Unlawful Internet Gambling Enforcement Act (UIGEA)
- Violation of the UIGEA (This charge was split into three counts to cover all three major sites)
- Operation of Illegal Gambling Business (This was also split into three counts to cover all three major sites)
- Conspiracy to Commit Bank and Wire Fraud (Scott Tom and John Campos are not named in this charge)
- Money Laundering Conspiracy
The defendants face a total 65 years in prison with the exception of Scott Tom and John Campos. They face up to 35 years in prison. In coordination with this indictment, the U.S. filed a civil suit against the 11 defendants. They are seeking a total of $3 Billion from the sites. They want $1.5 Billion from PokerStars, $1 Billion from Full Tilt, and $500 Million from AP/UB. They also require the rights and proceeds from any and all businesses tied to the sites as well as the domain names for the sites. There are also 77 different bank accounts in both the United States and other countries that the government seeks the rights and assets of.
Here is the list of sites and businesses that the US wants to confiscate:
- Pokerstars.com domain
- FullTiltPoker.com domain
- AbsolutePoker.com domain
- UB.com domain
- Ultimatebet.com domain
- Full Tilt Poker
- Absolute Poker
- Blanca Games, Inc of Antigua
- Tiltware LLC
- Pocket Kings Ltd.
- Pocket Kings Consulting Ltd.
- Full Tilt Poker Ltd.
- Absolute Entertainment, S.A.
- Oldford Group Ltd.
- Pyr Software Ltd.
- Ranston Ltd.
- Filco Ltd.
- Rational Entertainment Enterprises Ltd.
- Stelekram Ltd.
- Sphene International Ltd.
- Vantage Ltd.
- Kolyma Corporation A.V.V.
- Mail Media Ltd.
- SGS Systems Inc.
- Fiducia Exchange Ltd.
- Trust Systems Ltd.
- Blue Water Services Ltd.
To quickly summarize the allegations, the US government contends that the sites and defendants blatantly tried to violate the UIGEA while at the same time committing bank fraud and laundering money. They say that the sites achieved this through various processes including fraudulent credit card processing, fraudulent processing of e-checks, and transparent processing where the sites paid off certain banks to illegally process online poker payments. John Campos’ bank was the major bank connected to transparent processing. They processed over $200 Million in online poker payments and received Millions in fees from the online sites.
As a result of the allegations, both PokerStars and Full Tilt have pulled out of the United States and players at present are unable to withdraw funds from the site. The sites at present claim that all funds are perfectly safe while they determine how best to proceed. All five domains listed in the indictment have been seized and display a DOJ seizure notification.
Chad Elie, John Campos, and Bradley Franzen have all been arrested in connection to the indictment and are scheduled to appear in Federal Court in New York this coming week. Raymond Bitar has issued a statement through Full Tilt Poker saying that he is saddened by the charges and is confident he will be exonerated. None of the other defendants have yet to speak on the matter.
UB and Absolute Poker have yet to release a statement and reports are that some players are still able to access. All other sites that service the US are still operational and running business as normal. This includes DoylesRoom, Lock Poker, Cake Poker, and Bodog. Some sites are even offering new signup and deposit bonuses as a result of Friday’s crackdown.
The ultimate outcome from the indictment and civil suit is unknown at present, but it is safe to say that the face of online poker has been changed forever. This may lead to an eventual pulling out of all US sites, but none of the sites have made any gestures in that direction. This has been viewed as many at the “Online Poker Apocalypse” for the United States. Whether this is the beginning of the end for online poker is uncertain, but it will definitely be a hot topic and a hotly contested one for the foreseeable future.