DoJ Shuts Down US Poker Sites

Posted April 19th, 2011 by admin No Comments »

The US online poker world was shocked last Friday when action initiated by the Department of Justice (DoJ) led to virtual shut down of the three biggest US poker sites. An indictment unsealed in the Southern District of New York charged the founders of Poker Stars, Full Tilt Poker and Absolute Poker with serious financial offences. Since most of these individuals are currently outside the United States, the authorities have enlisted assistance from international agencies for their arrest. The DoJ has also seized all the US domains of these online poker sites and American players are no longer able to access Poker Stars, Full Tilt Poker and Absolute Poker. The DoJ is also seeking a penalty of $3 billion from these three US poker sites.

The charges faced by the indicted persons go far beyond operating illegal online gambling sites. The legal opinion seems to be that the DoJ would not be able to make the illegal online gambling charges stick. However, according to the indictment the major charges are bank fraud and money laundering under the UIGEA. It has been alleged that the three US poker sites showed the funds received from US online poker players as payments made to fake online merchants for merchandise such as jewelry and golf balls. In fact three persons involved with the processing of payments have been arrested. Chad Elie and Bradley Franzen are payment processors and John Campos is from Sun First bank in Utah, which actually processed the payments.

As of now Poker Stars, Full Tilt Poker and Absolute Poker can be accessed by players from jurisdictions outside the United States. Poker Stars has even indicated that it is willing to pay the amounts in balance to those American players who can demonstrate a having a bona fide second address outside America. But for how long this will continue is anybody’s guess.

Reactions from the online poker industry have been trickling in. Black Friday is the common name being given to this fateful day. Online poker columnist Aaron Todd has given April 15, 2011 a more sentimental name – “the day that online poker died”.

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