FBI takes down Online poker sites in US
Posted: Sunday, April 17, 2011 by Tyler Durden in
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http://www.news.com.au/business/fbi-charges-11-internet-poker-kingpins/story-e6frfm1i-1226040088210
FBI charges 11 internet poker kingpins
- From: AAP
- April 16, 2011
Just a few years ago Daniel Tzvetkoff, who created Brisbane-based internet company Intabill, had an estimated personal worth of $82 million. Picture: Drew Fitzgibbon
The FBI has charged 11 people, including the founders of three of the largest internet poker companies in the US / AAP
AUSTRALIAN internet whiz Daniel Tzvetkoff, who has become a prized FBI informant in a bid to avoid a 75 year jail sentence in the US, may have brought down the multi-billion dollar American online poker industry.
The FBI announced today it had charged 11 people, including the founders of three of the largest internet poker companies in the US, with bank fraud, money laundering and illegal gambling offences.The three poker sites - PokerStars, Full Tilt Poker and Absolute Poker - have been shut down.
It is believed Gold Coast entrepreneur Mr Tzvetkoff's decision to turn super-grass and reveal to authorities the secret schemes used by poker companies to illegally launder billions of dollars via phony bank accounts and shell companies helped the FBI and New York prosecutors build their case.
"These defendants, knowing full well that their business with US customers and US banks was illegal, tried to stack the deck," FBI assistant director Janice Fedarcyk, in announcing today's charges, said.
"They lied to banks about the true nature of their business."
The internet gambling kingpins, including 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, face 30-year sentences in US jails.
A year ago it was 28-year-old one-time Queensland high-flyer Mr Tzvetkoff who faced the long stint in the US federal prison system for money laundering, bank fraud and other charges.
US authorities arrested Mr Tzvetkoff exactly a year ago (April 16) when he visited one of the top casinos on the Las Vegas strip, the Wynn, for a gambling conference.
Mr Tzvetkoff was painted by prosecutors as the brains behind the creation of an illegal system for processing $US500 million in transactions between US gamblers and internet gaming websites. Mr Tzvetkoff allegedly created phony shell companies with names unrelated to gambling to process the transactions.
US federal prosecutors vigorously fought to keep Mr Tzvetkoff in jail, battling and eventually overturning a Las Vegas judge's decision to grant the Australian bail.
Mr Tzvetkoff was transferred to a New York jail and sat there until June when in a surprise about face, he was quietly released with his whereabouts unknown.
"He's turned the corner, seen the light and is co-operating," former FBI agent Harold Copus, after reviewing the details of the case, told AAP.
It is believed Mr Tzvetkoff and his fiancee, Nicole Crisp, are being held in a safe house.
Mr Copus, head of Atlanta-based private investigative company Copus Security Consultants, said that was normal procedure for a high-value informant.
Prosecutors and Mr Tzvetkoff's Boston-based lawyer Robert Goldstein have refused to comment on the Tzvetkoff case.
Mr Tzvetkoff's life in exclusion and period in Las Vegas and New York jails was polar opposite to his flamboyant former life as an internet high-flyer.
Just a few years ago Mr Tzvetkoff, who created Brisbane-based internet payment processing company Intabill, had an estimated personal worth of $82 million, bought a $27 million home on the Gold Coast, drove Lamborghinis and Ferraris and sponsored a professional motor racing team.
Prosecutors during last year's bail hearing in Las Vegas suggested Mr Tzvetkoff may have a secret stash of $US100 million in money netted from illegal dealings.
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http://www.tightpoker.com/news/online-poker-sites-shut-down-2345/
http://www.tightpoker.com/news/pokerstars-shuts-down-2347/
http://www.tightpoker.com/news/full-tilt-poker-shuts-down-2351/
Online Poker Sites Shut Down
By Peter Laurrell | April 16, 2011
The two online poker sites shut down all American operations after the FBI unsealed indictments against the sites’ owners. It is alleged that 11 people connected to PokerStars, Full Tilt, and Absolute Poker have committed acts of wire fraud and money laundering.
The FBI claims that PokerStars and Full Tilt Poker employed individuals to act as “payment processors,” in order to facilitate the transfer of online gambling funds to U.S. financial institutions. These payment processors allegedly set up fake companies, including online websites purporting to sell golf balls and jewelry, which the poker sites used to send gambling funds from player accounts to banks untraced.
The U.S. Attorney’s press release explains that “because U.S. banks and credit card issuers were largely unwilling to process [poker sites'] payments, the Poker Companies allegedly used fraudulent methods to circumvent federal law and trick these institutions into processing payments on their behalf.”
11 individuals connected to PokerStars, Full Tilt Poker, and Absolute Poker face charges including “Conspiracy to Commit Bank Fraud and Wire Fraud” and “Money Laundering Conspiracy.” If convicted, some of the defendants could face up to 30 years in prison as well as a $1,000,000 fine.
Online Poker Sites Shut Down as Legal Heat Intensifies
Given the extreme severity of these allegations, the two largest online poker sites shut down to U.S. players indefinitely. American players can no longer deposit at, play at, or withdraw from either PokerStars or Full Tilt Poker.Any player who attempts to sign up for a real money account using a U.S. address will be denied service. Whether or not PokerStars and Full Tilt will re-open to Americans in the future is unknown.
Players who already use PokerStars or Full Tilt will not be able to deposit going forward. The FBI has frozen numerous bank accounts connected to various payment processors used by both poker sites, leaving the sites’ ability to process American payments all but crippled.
U.S. players with existing accounts will find they are unable to sit in at real money tables. It has also been reported that American players can no longer open the Full Tilt Poker software at all, following a recent software update.
Players with bankrolls sitting on either site will need to be patient, as the sites’ official withdrawal policies seem to conflict with how they are actually processing cashouts. Full Tilt maintains that U.S. players can still withdraw money as usual, however many players are reporting denied cashout requests and bounced checks.
Existing PokerStars customers are experiencing the same issues. Some players have been able to successfully cash out via wire transfer, while others have been unable to get withdrawal requests approved.
Now that two of the biggest U.S.-market poker sites have shut down, many players are wondering what the future holds for online poker. While PokerStars and Full Tilt shutting down is a big hit to the game, the sky has not fallen just yet. As of now, there are many online poker sites accepting real money action from U.S. players.
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PokerStars Shuts Down - No More USA Players
By Tight Poker Staff | April 16, 2011
The FBI has seized the pokerstars.com domain name and indicted the owners of PokerStars for bank fraud and money laundering. It is alleged that PokerStars and various associated payment processors attempted to circumvent Federal anti-gambling law by tricking US banks into accepting gaming funds illegally.
A press release out of the Manhattan US Attorney’s office lists 11 defendants as charged with criminal fraud, money laundering, and operating an illegal gaming site. Among those charged are the founders of PokerStars and various parties engaged in payment processing for PokerStars.
In light of these severe allegations, PokerStars shut down all US operations indefinitely. The site is accepting no more USA players at this time.
Can USA Players Sign Up at PokerStars?
No, PokerStars has shut down to all US players. Any player attempting to sign up for real money games using a US address will be unable to access the game tables.
Did PokerStars Shut Down US Deposits?
Yes, PokerStars has shut down deposits for US players. The FBI investigation resulted in over 75 payment processors linked to PokerStars being shut down. Thus PokerStars’ ability to process transactions in the US is severely limited.
Has PokerStars Shut Down US Withdrawals?
The status of PokerStars withdrawal requests for US players is a gray area right now. The company has issued an official statement claiming that all US players’ funds are in safe hands, set aside in an unknown bank account.
However some players have reported on online poker forums that PokerStars is declining withdrawal requests, and that even transactions approved by PokerStars are being denied at the bank level.
US-based PokerStars customers with money stuck in accounts must take a gamble: either request a withdrawal that could end up frozen by the FBI in a rogue payment processor’s account, or sit tight and wait for PokerStars to officially refund USA players. The odds of either scenario happening are unknown.
One thing is clear: there will be no more USA players at PokerStars in the near future. American poker players who want to play for real money will have to look to one of the other online poker sites that accept American traffic for now.
Is Online Poker Doomed in the US?
No, there are still many poker rooms online that accept US players. Further, the act of playing poker online is not illegal at the Federal level. Some states do prohibit citizens from gambling online, but for the majority of Americans, there are still many options.
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Full Tilt Poker Shuts Down - No USA Players!
By Tight Poker Staff | April 16, 2011
Have All Poker Sites Shut Down?
No, not at all. Only a handful have closed their doors including Pokerstars, Absolute Poker, Ultimate Bet and Full Tilt Poker. There are still a number of US poker sites unaffected by the FBI seizures including Sportsbook Poker and Bodog Poker. The recent news was a shock to everyone and although it could appear to be the end of online poker, the remaining US poker rooms, including those listed above have said it’s business as usual.
The U.S. Attorney in Manhattan, Preet Bharara, alleges that the founders of PokerStars and Full Tilt Poker “concocted an elaborate criminal fraud scheme.” This alleged scheme involved the sites and their payment processors lying to American banks, bribing bank executives, and attempting to “buy” small financial institutions in order to facilitate illegal gambling payments.
If these allegations hold up in court, 11 defendants could face convictions for various crimes, ranging from “Conspiracy to Violate Unlawful Internet Gambling Enforcement Act” to “Conspiracy to Commit Bank Fraud and Wire Fraud.” The maximum penalty for the latter charge is 30 years in prison, plus a fine of $1,000,000 or twice the gross gain or loss from the fraudulent operations.
Given the severity of these charges and the nature of the defendants’ involvement in PokerStars and Full Tilt, both sites have deemed it prudent to cease all U.S. operations. It is unclear as to when, or even if, the sites will re-open for business in the U.S.
Can U.S. Players Still Sign Up at Full Tilt Poker?
No, U.S. players cannot sign up to play or download Full Tilt Poker. Any player accounts connected to U.S. addresses, or connected to U.S. IP addresses, will be barred from sitting in at the tables.
Can U.S. Players Still Deposit at Full Tilt Poker?
No, U.S. players cannot deposit at Full Tilt. All real money and free games are closed to US players, even for players with existing accounts at the sites.
As a part of the recent FBI investigation into PokerStars and Full Tilt’s operations, over 75 bank accounts linked to payment processing companies have been frozen. Thus getting money from the poker sites and into banks — and by extension from the poker sites and to American players — is extremely difficult.
Given these difficulties in processing gaming transactions, Full Tilt and PokerStars closed to US players for the time being.
Can U.S. Players Still Withdraw from Full Tilt Poker?
Full Tilt Poker issued an official statement claiming that “processing of both deposit and withdrawal requests is proceeding as normal and is still available to all of our players.” However there have been numerous reports on poker forums that players have been experiencing difficulties cashing out since the Full Tilt Poker site shut down.
Many players have experienced their cashouts being approved initially, but rejected just hours later for reasons unspecified by Full Tilt. Other players have been unable to access the cashier’s withdrawal window at all. And still others have been frozen out of the Full Tilt software entirely.
At PokerStars, the situation is much the same. Some players have reported successful bank wires, while others have reported being denied cashout requests repeatedly.
Since so many U.S.-serving payment processors have been shut down, it is unclear how Full Tilt and PokerStars plan on getting money to American players. But if the sites’ official statements are to be believed, all players’ funds are safe and will be paid out accordingly.
Can U.S. Players Still Play Online Poker?
Yes, there are still many U.S. poker sites running online. While the closure of PokerStars and Full Tilt takes out two of the biggest American-market players, it doesn’t spell the end of online poker in the U.S.
