Poker Blog and Poker Gossip

According to Laurent Tapie, the managing director of Groupe Bernard Tapie (GBT), the French investment company, the acquisition of Full Tilt Poker (FTP) will be completed by February end if everything goes as planned.

Full Tilt Poker collapsed after the US federal government cracked down on US online poker in mid-April last year, seized the site’s domain names, and indicted its chief executive officers on counts of money laundering, bank fraud, and illegal gambling.

Tapie also said that, according to the acquisition deal, GBT will renew FTP’s Alderney Gambling Control Commission (AGCC) license after acquiring the online poker room for around $80 million from the Department of Justice (DoJ).

Meanwhile, Leonard B. Sand, the US federal judge, has delivered a verdict, in which the class action complaint filed against Full Tilt Poker and companies and individuals associated with it has been dismissed. The defendants are Full Tilt Poker, Filco, Pocket Kings Limited, Vantage Limited, Ray Bitar, Tiltware, Nelson Burtnick, and professional Full Tilt Poker players such as Allen Cunningham, Patrick Antonius, Gus Hansen, Andy Bloch, Mike Matusow, and others.

The judge has dismissed this case because it is not clear whether the plaintiffs are unable to gain access to their funds because of the DoJ crack down or because of firms associated with FTP, or poker pros.

According to the court ruling, the case can be continued against Vantage Limited, Filco, and Pocket Kings, but not against the individual professional poker players mentioned in the list of defendants. Judge Sand stated that Pocket Kings, Filco, and Vantage Limited together maintained the FTP website, owing to which it can be inferred that they prevented the plaintiffs from gaining access to their poker funds.

The judge therefore dismissed the class action suit against all defendants except Filco, Pocket Kings, and Vantage. The case against Pocket Kings Consulting and Tiltware stands dismissed.

According to a US District Court judge, the civil case filed by a group of poker players who held accounts on Full Tilt Poker (FTP) against certain FTP units and executives has been dismissed since the claims are “too attenuated.”

In June, a group of ex FTP players who wanted to regain the $150 million they claimed to have lost when the US Department of Justice (DoJ) cracked down on FTP and certain other online poker rooms, filed a case under the Racketeer Influenced and Corrupt Organizations Act, a federal law.

Leonard B. Sand, the judge of the US District Court who heard this case, said, “It remains unclear whether the direct cause of the plaintiffs’ injuries was the decision by the U.S. Attorney’s office to temporarily shut down the Full Tilt poker website and seize the company’s assets or was instead as plaintiffs’ conversion allegations suggest, the subsequent decision by one or more of the defendants to halt player withdrawals.”

Two of the five FTP units that sought dismissal of this case are the online poker room’s software developer and the operator of its website. While the judge allowed the case to be moved against three of the five FTP units, he said that the plaintiffs will have to modify their cases against the other two units. The case bears the title Segal vs. Bitar, 11-cv-4521, New York Southern District Court.

It may be recalled that, on April 15, 2010, a day referred to as the Black Friday of online poker, the DoJ cracked down on two Cereus Network sites Absolute Poker and UB Poker as well as PokerStars and FTP, seized their assets, and arrested their executive officers on allegations of illegal gambling, bank fraud, and money laundering. While PokerStars successfully refunded its US poker players, ex FTP players are still waiting for their money.

British poker players who had accounts at Full Tilt Poker before the online poker site crashed have been advised to complain to their local police if they consider themselves to be victims of a crime.
In a statement issued recently, the Alderney Gambling Control Commission (AGCC), which revoked Full Tilt Poker’s licenses to provide online gaming services at the end of June last year, stated that UK poker players who had accounts on Full Tilt Poker must approach their local police if they have not yet been refunded.
AGCC has issued a statement regarding Full Tilt Poker after a number of months, but this statement makes no mention of the acquisition deal signed between the online poker room, the US Department of Justice (DoJ), and Groupe Bernard Tapie (GBT), the French investment company, according to which GBT will soon purchase Full Tilt Poker for $80 million.
Once the acquisition is completed, DoJ will take up the responsibility of refunding Full Tilt Poker’s US players while GBT will refund Full Tilt Poker players in the rest of the world. However, no details have been revealed regarding the exact procedures the DoJ and GBT intend to follow while refunding the players.
Here is what the AGCC statement says: “At the request of the police, AGCC will continue to log incoming player complaints: these records will be made available to the police. However, following the revocation of the licences, AGCC no longer has authority to intermediate or arbitrate on player issues or disputes with Full Tilt (excepting for players registered under a Swiss address)”
The statement also says: “It is understood that a number of civil actions have been initiated by players against Full Tilt, some as class actions representing multiple players by UK, US and Canadian lawyers. Details of the firms concerned can be found through internet search.”

According to Howard Stutz, who has recently published a report in the Las Vegas Review, the recent DoJ announcement regarding the Wire Act of 1961 is no reason for celebration. He points out that online poker fans have been celebrating this DoJ move without properly analyzing the situation. The DoJ delighted US online poker fans by stating that the Wire Act of 1961 does not apply to online poker as it is not a sport.

Quoting Prof. I. Nelson Rose, who said “we are about to see this explosion of internet gambling sweep across the nation,” Stutz voices his opinion that he does not “want to be the wet blanket dropped on the party, but we need to analyze the situation.” He agrees with Greg Gemignani, the gaming expert and lawyer, who said, “This is not a green light to fire up the online poker servers by any means.”

In his report, he also studies the opinions voiced by American Gaming Association and the big casino operators in Las Vegas, who are steadily applying pressure on the US federal government to create a regulatory framework for online poker before individual states do it.

He writes, “The move could make Nevada, which adopted internet poker regulations last month, the regulatory hub for the nation’s online poker industry, providing the state with a new revenue source and high tech jobs.”

He does not feel that the federal government will regulate the US online poker industry this year, and neither does he feel that the states will make much progress either. He points out that a number of small US states simply lack the financial power to invest into the industry, while others have to face the demands of Native American tribes. He, however, predicts that online poker will be in the news for the next one year.

The American Gaming Association (AGA) has come out with a detailed response to the recent clarification from the Department of Justice (DoJ) regarding the Wire Act.

In a recent statement the DoJ had said that the 1961 Wire Act applies only to sports betting and that US online poker is not covered by the law. This significant new stance by the federal government has thrown the doors open for individual state legislations which authorize US online poker. Nevada, expectedly, was the first off the blocks to pass a law that permits intrastate online gambling.

Meanwhile, the AGA which represents the casino trade has shared its opinion on the impact of the federal government’s stand and on what it believes is the best way forward. In unambiguous terms the AGA has called upon the government to follow up on the Wire Act interpretation with a comprehensive federal legislation that covers all aspects of online gaming.

The AGA emphasized the need for a uniform set of regulations and controls in order to monitor and administer all the worrisome aspects of online gambling. The AGA pointed out that if individual states came up with separate laws it would be difficult for the trade to comply with all the multiple sets of legislation. This would also leave room for the mushrooming of unlicensed or illegal operators.

A uniform federal law is essential to curb underage gambling, fraud and money laundering. A nationwide and standardized set of regulations would also better protect the rights of players.

Significantly, from the trade’s point of view, a federal law would simplify the process of operators in terms of compliance and ease of access to various markets across the nation. The AGA also noted in its statement that if they were multiple state level laws these would effectively reduce the choice for players in terms of which sites they can play on and the opponents that they get to play with.

Brent Beckley, one of the owners of Absolute Poker pleaded guilty to charges of conspiring to contravene U.S. anti-internet gambling laws, conspiracy to commit bank fraud and conspiracy to commit wire fraud.

Absolute Poker was one of the biggest online poker sites operating in the U.S. when federal authorities cracked down on Black Friday, April 15, and seized the company’s internet domain name and assets associated with the domain name. The operations of two other major online poker websites – Full Tilt Poker and PokerStars – were also shut down as part of the federal action.

Owners, directors and other associates of the three companies were charged under the Unlawful Internet Gambling Enforcement Act and other U.S. laws.

Brent Beckley, part owner of Absolute Poker, told Judge Ronal Ellis that under the name of Absolute Poker he facilitated internet betting by accepting credit card payments from players. To proceed with the processing of these payments he misrepresented the purpose of these payments. Beckley agreed that he was aware of the illegal nature of his activities.

To ensure the processing of the credit card payments he employed a specialist “payment processor”, Ira Rubin, who processed the e-checks by fraudulently disguising them as payroll processing and affiliate marketing and by misrepresenting Absolute Poker as online electronics merchants. Rubin has been evading arrest on telemarketing fraud charges by hiding in Central America.

Beckley reportedly has struck a plea bargain that will see him serve only between 12 and 18 months as against the possible maximum of 30 years in prison that bank fraud charges carry. Ira Rubin is also close to striking a plea deal, according to his lawyer.

According to the prosecution, the poker companies collected billions of dollars of bets from players and roughly one third or more of this money went as revenue to the companies.