FBI looks at Online Poker Sites - And you wonder why we’re a suspicious bunch?

[jj & cindy]

We read this week, that the online poker sites PokerStars, Full Tilt Poker and Absolute Poker were all charged with bank fraud, illegal gambling offenses and money laundering. If you go to their websites apparently some give you a message that the domain has been seized by the FBI - some others just stopped operations in the US while this mess gets worked out.

They also said that Wynn and Stations Casinos immediately cut ties and Caesar’s Entertainment is just kind of waiting in the wings to see what happens. They reiterated to say they were not busted for illegal online gambling, but that 11 people were charged with bank fraud, illegal gambling offenses and money laundering.

We don’t gamble online, as all forms of gambling are illegal in Hawaii, but thought this was some interesting information about some pretty big online names. The easier the rules, the easier the fraud.

[SteveBourieOLD]

Re: FBI looks at Online Poker Sites - And you wonder why we’re a suspicious bunch?

We just posted a column by gaming attorney I. Nelson Rose about this situation.

He's says that federal authorities went way too far and writes - Can a government be charged with war crimes, if the war is only one of intimidation? The U.S. federal Department of Justice isn’t blowing up buses. No one has died. But while Palestinian terrorists can only close down Israeli pizza parlors; the DoJ stopped online poker sites from doing business anywhere in the world – including where poker is 100% legal.

You can read the entire article here - Black Friday: A Step Too Far - ACG - ACG

[ryan83]

Re: FBI looks at Online Poker Sites - And you wonder why we’re a suspicious bunch?

What about the fact that the online gambling sites lie in order to accept deposits from US banks? Per the UIGEA "No person engaged in the business of betting or wagering may knowingly accept, in connection with the participation of another person, in unlawful Internet gambling – [credit, EFTs, checks, drafts, or the proceeds of any other form of financial transaction as set forth in federal regulation]."

So what they do is they mask deposits as jewelry purchases, magazine purchases, etc by setting up fake companies to charge the deposits to. It was always pretty clear to me that these sites would be taken down eventually because it's basically money laundering in order to fund an activity that law prohibits.

[SteveBourieOLD]

Re: FBI looks at Online Poker Sites - And you wonder why we’re a suspicious bunch?

What you say might be true, except for the words "unlawful internet gambling."

Who says poker is "unlawful internet gambling?"

It is my understanding that in order for something to be "gambling" the outcome has to be based on pure chance. Meaning that anyone can win win just as easily as anyone else. That's why a slot machine would definitely be considered a game of chance.

Poker, however, is a game of skill and I don't believe that it would qualify as "unlawful internet gambling." Do you think that someone who has never played poker before would be able to consistently beat a professional poker player? I am sure that would never happen. Maybe a few times out of 100 games, but never anything close to 50% of the time.

Therefore, if the game of poker does not qualify as "unlawful internet gambling" then the poker sites did absolutely nothing wrong.

[ryan83]

Re: FBI looks at Online Poker Sites - And you wonder why we’re a suspicious bunch?

Interesting, I hadn't thought of it like that. I've played a little on the online gambling sites and whenever I make a deposit I receive an almost immediate phone call from my bank suspecting fraud, and the phone call says that a transaction was made for jewelry or magazines or something like that. I guess because of the ambiguous nature of the law they have to do this, but I agree that poker is different than a slot machine and if the government wants to ban "games of chance" then poker should probably be in its own category.

Personally the libertarian side of me thinks that if I want to gamble online and play anything, a game of chance or skill, I should be able to. Yes online gambling is very dangerous and can lead to addiction but it is not the job of our federal government to ban it, they have more important things to worry about. The UIGEA is probably unconstitutional in my opinion but I'm not a lawyer.

[SteveBourieOLD]

Re: FBI looks at Online Poker Sites - And you wonder why we’re a suspicious bunch?

Below is info from a Las Vegas Sun article dated 5/29/11 that sums up the legal stances each side is taking. To see the whole article, go to - Poker websites’ actions were risky, experts say - Las Vegas Sun

Prosecutors say the sites still violated the Unlawful Internet Gambling Enforcement Act of 2006, which prevents illegal gambling operators from receiving the online wagers.

Poker proponents say the act is moot because online poker is legal and not subject to the 1961 Wire Wager Act — the primary federal law covering illegal gambling. The Wire Act, a Kennedy-era law outlawing wire transmissions of betting information across state lines, only covers sports betting, they say. Although originally aimed at mob bookmakers before the Internet age, the Wire Act today applies to all forms of gambling, the feds say.