PokerStars Founders And Full Tilt Poker In Trouble

Eleven individuals regarded as the founders of PokerStars, Full Tilt and Absolute Poker have been accused of alleged bank fraud, unlawful gambling offences which entailed money laundering in an indictment unsealed by federal prosecutors recently.

The 52-page indictment and civil complaint as seen by Cassaon-casino is seeking a minimum penalty which is approximately US$3bn in civil money laundering penalties from the three internet casinos and its defendants. They claim these parties “deceived or directed others in such a manner to hoodwink United States banks and financial organizations into processing billions of dollars in payments.”

The United States government imposed restraining orders against 76 bank accounts in fourteen countries used by these internet poker sites and their payment processors. The U.S government also seized five poker internet casinos. Poker players accessing these sites (PokerStars.com, FullTiltPoker.com and UltimateBet.com) were notified by the FBI about the indictment. Isai Scheinberg and Paul Tate of PokerStars, Raymond Bitar and Nelson Burtnick from Full Tilt and Absolute Poker/Ultimate Bet’s Scott Tom and Brent Beckley have been accused in the US versus Scheinberg et al of purportedly: “Organised that cash received from U.S players be masked as payments to hundreds of false internet ewallets purporting to sell merchandise such as jewellery and golf balls.

“These internet poker sites duped U.S banks into processing countless transactions, roughly one third or more of the cash went to these poker sites as profits via the ‘rake’ charged to players on almost every single poker hand played online,” the indictment goes on. Preet Bharara, U.S Attorney from Manhattan had the following to say, “These defendants planned a diabolical and very well organized scandalous fraud system, which deceived many U.S banks and bribed others to safeguard the sustained flow in illegal internet gambling proceeds. To top it all, in their fervour to thwart American gambling laws the defendants are also guilty of money laundering and bank fraud.”

PokerStars, Full Tilt and Absolute Poker have been accused of influencing key personnel of smaller banking institutions “who experience financial difficulties” to process payments on their behalf after U.S banks and financial institutions “tracked down a number of illicit bank accounts used by these poker sites” since the latter part of 2009.

John Campos is one of the senior bank officials of SunFirst bank in Saint George, Utah taken into custody recently. Chad Elie, a payment processor is accused of approaching Campos who received a US$10 million investment in SunFirst bank to process illegal internet gambling payments for the poker companies.

Campos will appear before a U.S magistrate court judge on the 18^th of April (Monday). Defendant Bradley Franzen will appear for arraignment in New York on the 19^th of April. Concerning the defendants Raymond Bitar, Isai Scheinberg, Paul Tate, Nelson Burtnick, Scott Tom and Brent Beckley, Ira Rubin and Ryan Lang, “are not in the United States at the moment, federal prosecutors have contacted various foreign law enforcement agencies and Interpol to apprehend these defendants overseas”, the indictment read.

It’s important to note, charges enclosed within the indictment are only accusations at this point in time, if convicted the guilty parties could spend up to 30 years in jail of conspiracy to commit bank and wire fraud and if found guilty of money laundering an additional 20 years. Violations of the UIGEA (Unlawful Internet Gambling Enforcement Act) and the running of illicit internet gambling sites carry a penalty of approximately five years in jail.

The crackdown comes weeks after land-based casino group Wynn Resorts publicized a business venture with PokerStars to establish a new US-facing website PokerStarsWynn.com upon passage of federal regulation for internet poker. In spite of its European-listed rivals exiting the market as a result of the UIGEA, PokerStars maintained that its U.S activities are above board.