Here is an update on the stunning and shocking blietzkreig served up today by the attorneys at the U.S. Southern District of New York on the owners of several banks and online poker sites, including industry giants PokerStars and Full Tilt Poker, along with Absolute Poker and several lesser known entities.
According to Matthew Kredel, of PokerNews.com,
The indictments revealed by the U.S. Southern District of New York against the owners of PokerStars, Full Tilt Poker and Absolute Poker are serious. The short-term outlook for online poker is grim.
PokerStars already has stopped serving the U.S. market. I expect Full Tilt Poker and probably Absolute Poker to follow. I would not expect these sites to serve the U.S. market again until after online poker is officially legalized, licensed and regulated in the country. Even then, the chances of these sites obtaining a license have been severely impacted. Americans with money on the sites likely will get it back eventually but, as it did when the Neteller founders were indicted, it could take a while.
Innocent until proven guilty is the credo of the U.S. justice system. But the Southern District of New York is the strongest arm of the Department of Justice. It doesn’t make indictments based on conjecture. It doesn’t go all-in on draws. It waits until it has you drawing dead, then shoves. That the court is making these indictments public now means it is certain it has damning evidence
I also learned from Kredel that the most damning of the charges directed at the owners of the sites are that they deliberately disguised financial transactions to make them appear to be unrelated to internet gambling. Even worse, it is alleged that one of the defendents, Chad Elie, along with cohorts, pressured several small, and financially troubled banks to process internet gaming transactions in order for high fees and cash investment in the banks themselves.
Some of you may not be so interested in the details behind this drastic action taken by the FBI and the Southern Justice District and are more interested in matters having to do with practical things like:
1. Will I receive the funds I have in my online poker account back?
Tentatively, I would say yes, but it will be a bit of time before that takes place.
2. What does this mean for the future of the major companies involved, Full Tilt Poker and PokerStars?
PokerStars has already withdrawn from the U.S. Market and these charges make it less likely for them to somehow reenter the market once online poker is fully legalized and licensed etc. Full Tilt may follow PokerStars but it is not known when or what is going to happen once poker is legalized.
3. What does this mean for the push to legalize internet poker in the USA, particularly during the last year or so?
Well, I think it is definitely going to hold back passage of any legislation legalizing internet poker. It goes without saying that this is a bold move made by the US Southern Justice District’s attorneys and as Mr. Kredel made clear, this is not the type of move they would make without the nuts. Its doubtful a case like this will go to trial, as it is a sure loser for the defendents. Its much more likely that a negotiated settlement will be reached. In any event, this move makes the issue more of a political hot potato and I’m not sure anyone is going to want to get their hands burned by taking this cause up again for a year or so. Not the best scenario I realize but I’m pretty sure its close to the reality of what is going to happen.
I’ll update this situation tomorrow and I’ll try and find out reactions from within the poker community from guys like Phil Laak, Phil Ivey, Doyle Brunson, Phil Helmuth, Daniel Negreanu etc. etc.
Have a good night…..