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PokerStars, Full Tilt, Absolute indicted by FBI for bank fraud, money laundering and illegal gambling
Friday 15th April, 2011 will be remembered as Black Friday II and a grave day for online poker in the US with the biggest 3 US facing poker sites indicted by the FBI and DOJ for bank fraud, money laundering and illegal gambling.
I DO think US players WILL get their money back from the affected sites, eventually.
At this point Fulltilt Poker, PokerStars, Absolute Poker & UB cannot be accessed by US players and realistically they will now be out of the US Poker market for a long time.
It looks like things are moving fast and not in a good way afaiks for US players. We will try to keep players updated as things develop.
Fulltilt & PokerStars are now definately down for US players
UB and Absolute will certainly follow if they are not down already
for non US players pokerstars.eu is now the url to use and Full Tilt using fulltiltpoker.co.uk as their main url for non US players who should remain unaffected by all the drama in the USA.
Basically the FBI / DOJ have shut down and siezed the domains of fulltiltpoker / pokerstars / ub & absolute poker for trying to get round the banking regs laided down in the UIGEA.
It also it looks like they have cited the wire act as well (which is somewhat tenuous) but in terms of bank fraud it looks like they have alot of strong evidence for the basis of the indictment.
Something similar happened to Bodog several years ago … if you remember the whole bodoglife change of url etc when they lost control of the url etc.
The most important concern is obviously the safety of player money – at the moment somewhere north of $3 billion has been siezed of poker rooms funds which will in effect include player funds.
While it is likely that players will get their money back, at the moment no-one is sure how this is going to pan out but my best assessment is that although the money is currently seized players will get their money back.
Ultimately the UIGEA is specifically set up ONLY to penalise the businesses ie. banks / processors / poker rooms that have contravened the UIGEA – NOT players.
The UIGEA cannot penalise players or prosecute players – therefore afaiks the player funds should ultimately (and hopefully will) be released at some point …
Although its not for me to say for sure this is just my assessment that there are clearly laid down sentences and fines for the named business owners so I think once things get resolved most likely with several large out of court settlements the player funds would be likely to get released solely to be returned to players – but that isn’t going to happen anytime soon.
Similar situations with Neteller getting closed to US gaming transactions meant funds (that were effectly players funds) were held in limbo for some time, eventually to be returned to players but that was on the governments timescale.
The whole thing with the UIGEA is IMHO rediculous given the current climate in the US seemed to be pointing towards regulation, taxation and clearer legalised framework.
However the FBI clearly feel they have a case as US facing poker rooms have clearly had to cut some corners and shoot the angles in order to keep deposits and withdrawals getting through the US system – this and this alone seems to be the reason for a solid case …
So basically an international industry that PRE UIGEA was managing to run perfectly well, ends up almost forced into laundering money by the very (stupid) bill that “sought” to make online poker safe by pushing the banking out of the normal channels – stupidity in the extreme
Lets look at that again, poker rooms previous to the UIGEA and currently regulated by other countries to a decent degree with reliable and legal means of paying customers their money, handling deposits in a secure and trustworthy manner overnight end up having to change and therefore are committing a crime that previous to the bill wasnt being committed – and would never have been committed if the UIGEA hadnt been enacted …
In effect the UIGEA has created “crime” and “criminality” out of something that wasnt even occuring before and created a problem for players workdwide, the US government should be ashamed of itself.
Last weeks announcements of partnerships between PokerStars with Wynn Resorts and Full Tilt Poker with Station Casino owners suggested a definate move towards regulation of an inter state (probably US only) solution and a repeal of the UIGEA.
Those partnerships and agreements will now be totally shot and worthless.
It is believed that the action of the FBI may have come about directly as a result of the arrest and later release without strings of a banking genius previously employed by the big sites to advise on how best to get round the difficulties the UIGEA presented.
Rumour is that he is believed to have “told all” to the Feds in order to get off the hook himself. Ironically the Feds knew he was in the US due to a tip off from one of the big poker rooms after he alledgedly stiffed them for some cash …
It looks like this revenge attack has bit them back royally on the a**, with him revealing how to reverse engineer all the complex banking procedures, processors and methods employed to keep the UIGEA at bay.
Ultimately the issue of online poker legality in the US again has proved something of an irrelevance as the grounds for those indictments ie. bank fraud and money laundering in themselves seem likely to be easy to prove.
However its the principle that without the stupidity of the UIGEA bill getting through on the back of the Safe Ports Act non of the smoke and mirrors would have been necessary in the first place.
In a sense this is yet another twist and turn in the lunacy that is the US Governments approach to online poker and online gambling environment generally where international trade law means nothing and minor technicalities in a tagged on bill mean everything.
How many or how long other US friendly sites and networks will remain open to the US remains to be seen. It’s unlikely the FBI have as much detailed and provable evidence of how and what other rooms do to get US player deposits and withdrawals sorted but its likely some will want to take advantage of the gap in the market and others may consider the longer game.
Inevitably poker at least will become regulated and legal in the US however I fear as predicted before the US land based casinos would ideally like this whole field to themselves … and it looks like they may very well have got it.
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