Online Poker Sites Shut Down

from ChaoticFate.com by qew

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Apr 15, 2011

Author: Steven

On April 15, 2011, the Federal Bureau of Investigation (FBI) seized the four poker sites' domain names: pokerstars.com, fulltiltpoker.com, absolutepoker.com and ub.com. Shortly after the seizure, the online poker sites shut down the tables to players with accounts linked to a United States address. A press release from the Manhattan U.S. Attorney's office has since confirmed many players' worst suspicions: 11 people, including the poker sites' owners and persons linked to the sites' payment processing operations, have been charged with gambling-related crimes.If you're an online poker player from the U.S., take note: PokerStars, Full Tilt Poker, Absolute Poker and Ultimate Bet are no longer accepting American traffic, leaving only a handful of US poker sites to choose from.

Manhattan U.S. Attorney Pret Bharara made it clear that the charges were serious: "these defendants concocted an elaborate criminal fraud scheme, alternately tricking some U.S. banks and effectively bribing others". Further, the U.S. Attorney alleges that "the defendants also engaged in massive money laundering and bank fraud."

The Unlawful Internet Gambling Enforcement act, passed in 2006, codifies the illegality of facilitating gambling transactions in the United States. To circumvent the UIGEA, the poker sites hired payment processing 'experts' whose job involved setting up shell corporations; these shell corporations would then obtain accounts at U.S. banks, through which funds from online poker sites could pass undetected.

In addition to tricking banks into opening accounts, the Manhattan U.S. Attorney claims that PokerStars, Full Tilt Poker and their payment processors "persuaded the principals of a few small, local banks facing financial difficulties to engage in [illegal] processing in return for multi-million dollar investments in the banks." In essence, the poker sites hired payment processors to bribe down-and-out financial institutions. All this in an effort to facilitate withdrawals and cashouts to American players, in contravention of U.S. law.

The 11 defendants now variously face charges of "Conspiracy to Violate Unlawful Internet Gambling Enforcement Act," "Violation of Unlawful Internet Gambling Enforcement Act," "Operation of Illegal Gambling Business," "Conspiracy to Commit Bank Fraud and Wire Fraud," and "Money Laundering Conspiracy." If convicted, some defendants could face up to 30 years in prison, plus a fine of $1,000,000 or twice the gross gain or loss from the operation. In the face of these charges, Full Tilt Poker, PokerStars, Absolute Poker and Ultimate Bet have evidently deemed it wise to exit the American market. Thus American players can no longer deposit at or play real money games at these sites.

It isn't clear yet what's to become of existing players' bankrolls. Some players on internet forums claim that PokerStars is approving cashouts; but whether or not financial institutions will actually process these remains to be seen. Players on Full Tilt Poker have reported being frozen out of the cashier's withdrawal screen entirely, unable to cash out any funds at all.

A result of the FBI investigation was that over 75 bank accounts linked to "payment processors" were frozen; so the capacity these sites have to actually process anything in America is unknown at this point. In short, if you're an American looking to play some online poker, don't bother with the Big 4. PokerStars, Full Tilt Poker, Absolute Poker, and Ultimate Bet won't be servicing U.S. players for a while.