U. S. Department of Justice Seizes Poker Rooms

<img src="http://www.liquidpoker.net/staff/Raidern/justice.jpg" align="right", style="margin:5px; border:1px solid black;">The U. S. Attorney for the Southern District of New York, Preet Bharara, and the FBI are charging PokerStars, Full Tilt Poker, UltimateBet and Absolute Poker with bank fraud, illegal gambling offenses and money laundering. The Attorney and the FBI unsealed an indictment where they charge eleven defendants, including the founders of the aforementioned sites.

When trying to access the website of one of these poker rooms, many poker players are surprised by a message informing that domain name has been seized by the FBI. In addition, restraining orders were issued against more than 75 bank accounts utilized by the poker rooms and their payment processors. Such a measure is likely to affect thousands of players, who may be prevented from cashing out money from these sites. As a precaution measure, Liquid Poker has decided to cease trading tournament dollars until the situation unfolds and we have positive news on the matter.

U. S. Attorney Preet Bharara said: "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."

According to the unsealed Indictment, a PokerStars document from May 2009 confirms that they received money from U. S. customers through fake company names that disguise the real real nature of the transaction, to avoid the rules imposed by the Unlawful InternetGambling Enforcement Act - UIGEA. The document explains that the poker companies "...] arranged for the money received from U.S. gamblers to be disguised as payments to hundreds of non-existent online merchants purporting to sell merchandise such as jewelry and golf balls."

Although the charges contained in the Indictment are merely accusations, the U. S. Government measures have already taken place, which is terrible news for every poker player and it is definitely a setback in the current state of the discussion on the regulamentation of online poker in the USA. Everything is still unclear and hopefully the upcoming days might be enlightening on the matter.

Read the press release from the Department of Justice.

Wow

oh wtf this shit is real :o

i dont think i'm overreacting when i say this might be the end of online poker as we know it.

This is some big news. Everyone run to the cashout button and create an online poker market crash.

lolol @ ptr graph, graph should be even higher though. the poekr sites are worth significantly more than 1.4b!!!

agree with schimmel, this is definitely the end of an era for online poker in the US

cant be arsed. im european!

On April 15 2011 15:59 Shenny wrote: This is some big news. Everyone run to the cashout button and create an online poker market crash.

lol -_-

Does this mean its a good time to cash out at least half your roll so you don't feel as terrible if the poker rooms just randomly close when you're playing and you cant get your money out?

Or, is a poker crash what the government may be wanting? Maybe they're trying to scare people into cashing out all at once since they haven't been able to stop the poker sites yet.

Oh, USA, how I love thee. But, fuck... We can be retarded assholes sometimes ~_~;;. Time to focus on SC2.

WTF I cant cash out

jesus

Out of where Gororok? Stars or FT? Check or Bank?

So, I am still not exactly sure what pokerstars did. Can someone explain to me what it is they did in detail?

On April 15 2011 17:48 asdf2000 wrote: So, I am still not exactly sure what pokerstars did. Can someone explain to me what it is they did in detail?

read the press realase

For example, defendants ISAI SCHEINBERG and PAUL TATE of PokerStars, RAYMOND BITAR and NELSON BURTNICK of Full Tilt Poker, and SCOTT TOM and BRENT BECKLEY of Absolute Poker, arranged for the money received from U.S. gamblers to be disguised as payments to hundreds of non-existent online merchants purporting to sell merchandise such as jewelry and golf balls. Of the billions of dollars in payment transactions that the Poker Companies tricked U.S. banks into processing, approximately one-third or more of the funds went directly to the Poker Companies as revenue through the "rake"

how???
I thought U.S. citizens couldn't deposit on pokerstars. So who and how?

On April 15 2011 17:48 asdf2000 wrote: So, I am still not exactly sure what pokerstars did. Can someone explain to me what it is they did in detail?

Basically in the Bush era there was a law passed that made it illegal to play online poker in the USA. Believe it or not there are thousands of laws in the USA that are blatantly ignored because it costs more to enforce them than it costs society to allow the "misdeed" to carry on. However in this case the law was basically circumvented by the major poker sites headquartering in Isle of Man and allowing US citizens to do business with them through "shady processing".

"Shady processing" is what the DOJ is going to try and prosecute, and is basically the big Poker Companies and Big Banks setting up these "bot companies" that looked like real companies that were not for gambling. People deposited money into these companies through the banks (like an investment) and when they cashed out, the Poker companies paid the player through the "bot company" like a dividend.

Of course most players don't know the difference because:
a) the law is so poorly enforced that aside from a one week stock hit back in 2006 when the law was announced no one has seemed to care up until 4 hours ago
b) when depositing or cashing out no one but the banks or the poker companies see the behind the scenes dealings

*I do not know why DOJ chose to act on this now, however I am inclined to believe that the did this to flex muscle as legal online poker legislation was beginning to garner more of a following

I also disagree with the DOJ's actions and believe that the law will be overturned (hopefully without income tax implications) but until then, the sites will be shut down in the US throughout the process, unless there is a big enough uproar for the Supreme Court to step in right away.

Can't sit at real money tables ...son of a bitch!

cya LP. it was fun while it lasted.

QQ