Three largest online poker sites indicted and shut down by FBI

[Frankie Lee]

http://latimesblogs.latimes.com/mone...wn-by-fbi.html

The founders of the three largest online poker sites were indicted by the FBI on Friday in what could serve as a death blow to the thriving industry.

Eleven executives at PokerStars, Full Tilt Poker, Absolute Poker and a number of their affiliates were charged with bank fraud and money laundering in an indictment unsealed in a Manhattan court. Two of the defendants were arrested on Friday morning in Utah and Nevada. Federal agents are searching for the others.

The money laundering caught my attention. However, the US laws for online gambling are a mess so it should be interesting to see where this goes. It may just be a mad American clamp down on gambling.


This thread might be more suited to US politics if it needs to be moved.

[Frankie Lee]

Are any of these companies based in the IFSC I wonder? Full Tilt Poker has a service provider called Pocket Kings based in Dublin anyway.

edit: This clarifies it a bit
http://www.irishtimes.com/newspaper/...288767701.html

[C. Flower]

I can see why they might no like these sites

[PaddyJoe]

Whatever happened to Labour's proposal on taxing online gambling providers?

21/01/2010 - 16:51:12
International online gambling sites will be forced to pay tax on Irish bets, under Opposition proposals revealed today.

The Labour Party said offshore bookmakers – including telephone and television operators – would be brought under a new 1.5% levy for the industry.

This would replace the existing 1% tax in betting shops and raise €90m for the Horse and Greyhound Racing Fund.

That fund has already cost the taxpayer €240m , the party said.

Mary Upton, Labour’s sports spokeswoman, said operators refusing the pay the levies would be banned in Ireland.

Read more: http://www.breakingnews.ie/ireland/l...#ixzz1Jdj5MrTd

[Sam Lord]

Bloody Hell. There is money in my Full Tilt account. Will the FBI be giving it back to me?

[Captain Con O'Sullivan]

A number of the people behind these sites live in places like Gibraltar and other havens- I recall a director of one of the biggest companies reaching an accomodation with US authorities a few years back and a large fine being paid. I think he was indicted as well and couldn't enter US territory for quite some time for fear of arrest.

'Please respect FT.com's ts&cs and copyright policy which allow you to: share links; copy content for personal use; & redistribute limited extracts. Email ftsales.support@ft.com to buy additional rights or use this link to reference the article - http://www.ft.com/cms/s/0/19d7793e-d...#ixzz1JgbCjZfS

PartyGaming, a Gibraltar-based company that operates PartyPoker, the dominant online poker site in the US, last week announced plans for an offering that may value it at more than £5bn ($9bn). Betfair, a fast-growing online betting exchange, could float for up to £500m.

Why should New York care? The US authorities have their reasons to stop online gambling advertisements and block people from using US credit cards to play poker. Not only do they regard online betting as a breach of a 1961 federal law, but many politicians do not want what they regard as an immoral pastime to flourish.

The problem is that the line between entertainment and financial services blurs as punters move from placing bets with bookmakers to wagering with others through online exchanges. As Michael Mainelli, a consultant and professor of commerce at Gresham College in London, says: "Betting markets are clearly coming to resemble other financial markets." http://www.ft.com/cms/s/0/19d7793e-d...#axzz1JgazwXWe

Party Gaming Tycoon Pleads Guilty in US Court
http://www.gamblingkingz.com/news/20...n-us-court.asp

'The US government's witch hunt against the Gibraltar based gambling giant, Party Gaming may be coming to an end after the company's founder and ex-officer, Anurag Dikshit travelled to the United States in order to plead guilty to charges, including the violation of the US Federal Wire Act.

As part of a massive cooperation deal, Dikshit agreed to forfeit $300 million to the US government. It was announced that the first instalment of the money has already been paid, and the rest will be paid out by the time sentencing against Dikshit occurs, or before September 30th, 2009 - whichever comes first.'

[Count Bobulescu]

There is no shortage of gambling, (gaming is the preferred industry term, less emotive), opportunities in the US. Beyond Las Vegas and Atlantic City, many Indian Nations have developed lucrative franchises that have sucked money across state lines to such an extent that states otherwise unwilling to get involved in gambling have been forced to do so to generate revenue and balance budgets. My home state of Maryland, a case in point.

According to this WaPo piece they ran afoul of a 2006 law. That’s not to say they didn’t also violate the earlier law.

http://www.washingtonpost.com/busine...GkD_story.html

Ironically, DC city Government is trying to get in on the “game”.

http://www.washingtonpost.com/local/...HZD_story.html

[DCon]

Are any of these companies based in the IFSC I wonder? Full Tilt Poker has a service provider called Pocket Kings based in Dublin anyway.

edit: This clarifies it a bit
http://www.irishtimes.com/newspaper/...288767701.html

700 people working at Pocket Kings

Raymond Bitar (39), chief executive of Full Tilt Poker, and a director of Dublin-based Pocket Kings, has been accused of violating the Unlawful Internet Gambling Enforcement Act, introduced into US law in 2006.

The Act prohibits the transfer of money from US financial institutions to online gambling sites.

Pocket Kings employs some 700 staff at the Cherrywood Science and Technology Park. It established a base here in 2006 and provides functions such as IT support, fraud detection, marketing and customer services to Full Tilt Poker, which is licensed in Alderney, Channel Islands.

Some of the best-known names in poker are sponsored by Full Tilt Poker, which hosts some of the most lucrative online games.

Ten other executives from companies such as Pokerstars, which is based in the Isle of Man, and Absolute Poker, operating out of Costa Rica, as well as Nelson Burtnick of Full Tilt Poker, have also been cited in the case filed by federal prosecutors in Manhattan.

In a statement released by Full Tilt Poker, Mr Bitar said he was surprised and disappointed by the government’s decision to bring the charges. “I look forward to Mr Burtnick’s and my exoneration,” he said.

Full Tilt Poker argued that poker was a game of skill and that it believed online poker was legal, as did “some of the best legal minds in the United States”.

I always find it funny that gambling is banned in the US but "investing" in a rigged stock market is encouraged..

http://www.irishtimes.com/newspaper/...294910339.html

[Baron von Biffo]

I always find it funny that gambling is banned in the US but "investing" in a rigged stock market is encouraged..

It's a bizarre place - Have a car boot sale in your back yard to sell off your unwanted machine guns and no one will raise an eyebrow but run a book on the Kentucky Derby and you're the Devil incarnate.

[C. Flower]

This is bad news for the Irish banks. The small bit they have left will be gone.

http://www.irishtimes.com/newspaper/...39.html?via=mr
.

The indictment says that, as of last month, Full Tilt Poker was the second-largest operator offering gambling on poker games to residents of the US.
It seeks the forfeiture of accounts in Allied Irish Banks, Bank of Ireland, Bank of Scotland (Ireland), Irish Permanent Treasury, National Irish Bank and Anglo Irish Bank in the names of Mr Bitar, Pocket Kings and Pocket Kings Consulting

[Apjp]

whats the bet all the money goes straight into the bankrupt indebted fed that they confiscate from these firms? Gambling is always profitable.

[Count Bobulescu]

Gambling is not, as has been asserted, banned in the US. Uninformed broad generalizations often result in more BS being heaped upon the original BS, and pretty soon you don’t know your arse from your elbow.

As I have noted elsewhere, US Constitution grants broad liberties to individual states.
Gambling is legal under US federal law, and each state is free to regulate or prohibit it. It’s a $90B biz. Ever heard of a place called Las Vegas?

The online poker people are accused of violating a 2006 federal law that outlawed internet gambling. It was enacted, in part, because of an inability to reach a consensus on how to effectively tax it, and in part due to lobbying pressure from State Lotteries, Indian, and Las Vegas Casino’s who are taxed, and felt unfairly treated. Feds are seeking forfeitures of $3B. No parole in the Fed Penitentiary System.

http://en.wikipedia.org/wiki/Gamblin..._United_States

[eamo]

Ray Bitar, CEO of Full Tilt Poker, aka Pocket Kings based in Cherrywood Dublin has been arrested today by the FBI when he returned by arrangement from Dublin.
He could get over one hundred years in gaol.


http://www.forbes.com/sites/nathanva...ceo-ray-bitar/

This link has a copy of his statement:

:http://www.pokernewsdaily.com/full-t...rrested-22069/