Three largest online poker sites indicted and shut down by FBI

[The Straight Story]

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

Prosecutors are seeking to immediately shut down the sites and to eventually send the executives to jail and to recover $3 billion from the companies. By Friday afternoon Full Tilt Poker’s site displayed a message explaining that “this domain name has been seized by the F.B.I. pursuant to an Arrest Warrant.”

The online gambling industry has taken off over the last decade, drawing an estimated 15 million Americans to bet online.

http://latimesblogs.latimes.com/money_co/2011/04/three-largest-online-poker-sites-indicted-and-shut-down-by-fbi.html

[CanonRay]

1. How about the banksters now, FBI?

[koffeekup]

2. Should be outlawed

There is no difference between these entities, or for that matter, ANY casino, etc. and my parking my butt in a chair on a street and convincing people to bet with me over the roll of one dice, a die, and if it is a four or less I win, and five or more you win....

[Mnemosyne]

3. I agree completely.

Welcome to DU, koffeekup! :hi:

[TheKentuckian]

17. Go Nanny State! Go!

Celebrate Puritan History everyday.

[LanternWaste]

26. Yeah... I think the diaphanous definition Nanny State has devolved

Yeah... I think the diaphanous definition Nanny State has devolved merely into "those laws I don't like..."

I imagine that while there's plenty of room between the Puritanical and the Hedonist, I figure the acknowledgement of that context takes all the melodrama out of the Orwellian-branding needed so critically to better validate that same preconceived perception of law.

[TheKentuckian]

27. I don't play so I don't care enough to like or dislike

but I consider such dictates out of step with the idea of self determination and the ability to pursue happiness. These kind of laws are straight out of our Puritan heritage and seek to make the state the arbiter of morality.

[mythology]

4. Except dice rolling is entirely random.

Poker is a game that involves skill as well as luck. It's not by accident that certain players have significantly better results over time than the majority of players.

[Johonny]

28. these online sites are not random

several people have shown that they were rigged. Online gambling not regulated not properly taxed. Don't get why anyone would play them after they were exposed to be clearly cheating.

[Nailzberg]

5. There is a big difference from what you describe.

Poker is a skill game against other players. What you describe is a chance bet against a house advantage.

Poker itself has been recognized as a skill game by the government and earnings are business income and not gambling income.

Online poker was made illegal in 2006, having been added to the Safe Ports bill by Frist, Kyl, and Leach. Why online poker is bad and live poker is good, ask those guys.

[Fearless]

7. Bull. I've happened these games for years and there's nothing wrong with it.

Get off your high horse and let people be adults and make their own decisions.

[Hugabear]

10. Then you know nothing about poker

Yes, the cards you're dealt are random. But there's a lot more to poker than just the random distribution of cards. Believe it or not, there's an awful lot of skill involved. Good poker players know how to calculate their odds, read the other players, learn their habits, etc. You don't get to be a professional poker player by just sheer luck.

[Fearless]

6. The feds want to tax it. Way to go Obama. You suck.

[cemaphonic]

12. What does this have to do with Obama?

The relevant laws were passed under a Republican Congress during Bush's administration. And regardless of how you feel about online poker (and I agree that it should be legal), the companies/individuals currently under the gun were (allegedly) involved in some pretty blatant money laundering and fraud to get around those laws.

I think investigating money laundering and fraud are pretty reasonable uses of the DOJ resources, even if the underlying cause is pretty stupid.

[Ex Lurker]

21. Barney Frank promised to repeal that law once the Democrats took over Congress

nothing ever came of it.

[Fearless]

31. Except that they did nothing actually wrong.

This is the DOJ pissing and moaning. ...And irritating 15 million voters. We're talking regular people who have had their assets in these games seized until when ever.

[cemaphonic]

33. Assuming that by "they", you mean the businesses, I disagree.

They were pulling some pretty shady shit to get around the 2006 laws. I'm definitely not ok with businesses just deciding on their own that they are free to ignore the law. Especially if in doing so, they go out and break a bunch more laws.

The players? Like I said, I think the laws are really stupid, and should be repealed. Between the "gambling is a sin" on the right, and the "gotta protect people from themselves" on the left, and the lobbyist influence from corporate and tribal gambling interests, good luck with that. (I live in WA, which actually went to the trouble to make *playing* online poker a felony offense. - Thats just playing - not running the sites. Totally insane, but casino gambling is big business here and has a lot of pull)

I do feel bad for the players with assets in limbo though, and for the people that were playing for a living. One of my brother's friends has been doing that for a few years now, but he has a knack for finding odd niches for himself. Before poker, he was arbitraging MMO loot.

[Fearless]

34. What is this stuff they were pulling exactly?

[cemaphonic]

35. Here's the DOJ press release.

http://www.justice.gov/usao/nys/pressreleases/April11/scheinbergetalindictmentpr.pdf

Basically, after the 2006 law, most banks stopped dealing with the online poker companies in order to cover their own liabilities. So the poker sites under indictment (the largest poker site by far simply stopped operating in the US) did things like disguising payments as phony merchandise, creating dummy companies as intermediaries, and bribing smaller banks to look the other way.

Granted, the prosecutors still have to prove their case and all, but assuming their evidence trail is solid, this looks like pretty blatant criminal activity to me, even though I think the underlying law is unreasonable.

[SidDithers]

18. ODS Fail...

:rofl:

Sid

[dionysus]

20. vehn ya think yer gettin shtiffed, and ya got the ODS,.. vaht? ...and then i said, san fransiskie?

did you driven or did you flew?

[aikoaiko]

8. Online card games and gambling in general should not be illegal.

Regulation and taxes could be worked out.

[Fearless]

9. They shouldn't be taxed.

[aikoaiko]

13. why not?

:shrug:

[Fearless]

30. Because they are internationally based.

[Johonny]

29. I agree

seems crazy to bet on an unregulated site. These sites were exposed to be regularly cheating people.

In theory gambling winnings are already suppose to be taxed.

[madinmaryland]

11. Wow! Amazing how the gambling apologists are out in full force tonight!

I guess having the right to lose your money to cutpurses should be a right.

Wonder how Steve Wynn views this????

[AlabamaLibrul]

14. Don't tell anyone....

(but I'm a winning player)

[Hugabear]

16. Poker is often a game of skill, not gambling

See posts #4, #5 and #10. Poker isn't like dice, roulette, slots, etc. There are specific skill sets that good poker players use. Good poker players know how to read the other players, they know how they tend to behave in certain situations, they know when to bluff, and when to fold. This is precisely why you tend to see many of the same people at the top professional tournaments.

[aikoaiko]

22. Cutpurse? How is that analogy remotely fitting?

The financial terms of playing games of skill or chance are transparent. Players enter into relationships with online gaming sites voluntarily.

:shrug:

[aikoaiko]

15. Here is the message from Full Tilt when one logs in.

I pulled my money out a long time ago and bought a CZ when the law squeezed the banks/CCs that did business with online gambling sites.

[Skidmore]

19. Good.

[Odin2005]

23. Gambling is a disgusting industry that take's advantage of people's ignorance of probability.

Shut them all down.

[DainBramaged]

25. These sites interfere with state lotteries, that's what's behind this IMHO

:hi:

[Hugabear]

32. Sigh...

Once again...there's a lot more to poker than simply chance and probability. Granted, the cards you're dealt are completely random, but there is an awful lot of skill involved in becoming a good poker player. Being a good poker player requires knowing how to read people, know how they play under certain situations, knowing when to fold your cards, etc. There's a reason why you tend to see a lot of the same faces at major poker tournaments, why some people tend to do very well.

[DainBramaged]

24. I love FBI designed websites (obvious saracasm)

http://www.pokerstars.com/

http://www.absolutepoker.com/

http://www.fulltiltpoker.com/