Black Friday

Monday, April 18, 2011

As you've probably heard, indictments were brought Friday by the Southern District of New York against the founders of the three largest online poker sites in the world: PokerStars, Full Tilt, and Absolute Poker. Arrest warrants have been issued, domain names have been seized, and at least for now, the public face of online poker in the United States resolves to a joint FBI/DOJ takedown notice.

That's right, the online poker faucet has effectively been turned OFF in the land of the "free". A few smaller sites are harvesting the displaced US player base (read: refugees), but confidence in the US online poker economy and the sanctity of deposits has evaporated for the time being. The forums are buzzing with horror stories of nationwide account lockouts, four-, five-, six-digit bankrolls consigned to digital limbo, wild plans to move to other countries or segue into the snail's pace of brick-and-mortar games. There are allegations of fraud, embezzling, corporate wrongdoing, cats mating with dogs, wombat conspiracies, calls for potential 3-billion dollar fines, madness, wailing, gnashing of teeth.

Poker Player's Alliance executive director John Pappas called it "nothing less a declaration of war on poker and the people who play it".

In a statement released today, the PPA goes on to say:

Millions of Americans across the country today are outraged over the U.S. Department of Justice’s clear attack on internet poker. While the government’s focus may be on the companies who operate these games, this is plain and simple a declaration of war on poker players and poker players’ freedoms. Not only are the over 10 million online poker players left without a place to play the game they enjoy, and from which many earn their livelihood, but they also have concerns over the availability of their funds. The PPA believes that no players’ money should be jeopardized by this prosecution.

While I've been critical of major online poker sites from time to time, including all three sites named in Friday's action, I couldn't agree more. I have to wonder what kind of government pays lip service to "freedom" while punishing consenting adults for playing harmless games of skill in the privacy of their homes. Would that be the same government that pays lips service to the "public good" by engaging in Reefer-Madness-style invective against online poker...while aggressively marketing its own lineup of pure, unadulterated games of chance to the public at large?

Give me a break. State-approved forms of gambling like lotto and scratch cards (psychologically optimized, packaged for instant consumption) are to the game of poker approximately what a rock of crack cocaine is to a glass of fine wine. The hypocrisy here is radioactive. Friday's actions were a shakedown executed by the anti-online-gaming cartel on the basis of a 2006 piece of throwaway legislation (UIGEA), attached to an invincible port security bill, ramrodded through the last day of Congress before elections. It's exactly the kind of law which prompted Ayn Rand to write:

That which cannot be formulated into an objective law, cannot be made the subject of legislation—not in a free country, not if we are to have “a government of laws and not of men.” An undefineable law is not a law, but merely a license for some men to rule others.

Given that online poker is one of the murkier areas in the international canon of legal confusion, the smugness and complacency of portions of the DOJ press release seems inappropriate, if understandable given the pissing contest between the SDNY and approximately every rational thinking poker player on the planet:

These defendants, knowing full well that their business with U.S. customers and U.S. banks was illegal, tried to stack the deck. They lied to banks about the true nature of their business. Then, some of the defendants found banks willing to flout the law for a fee. The defendants bet the house that they could continue their scheme, and they lost.

Emphasis mine. Immature wordplay unbefitting an federal authority figure who just used that authority to take away the rights of millions of US citizens? Not mine. "Chip" on your shoulder, Jan?

Sigh.

(Something tells me if it hadn't been "banking fraud" the fine folks at the SDNY would've found something else to go after, like toaster oven abuse, or maybe a class action for mouse-aggravated repetitive wrist strain. There are a million ways to slice and dice, when your social network holds the legislative, judicial, executive, and every other power, and when the group you're targeting—online poker players—has few friends and many enemies.)

The issue here is not whether foreign online poker corporations skirted US banking laws!

At issue is whether a mid-level government employee can reach halfway around the world, seize a domain, disrupt a billion-dollar established business, displace millions of users, and cause untold damage to the public perception of a brand and sport for years to come...all without so much as a warning, a by your leave, a vote, a public discussion, and without any substantial recourse for the accused.

I'll close with an old quote:

First they came for the communists,
and I didn't speak out because I wasn't a communist.

Then they came for the trade unionists,
and I didn't speak out because I wasn't a trade unionist.

Then they came for the Jews,
and I didn't speak out because I wasn't a Jew.

Then they came for me
and there was no one left to speak out for me.

So here's to hoping some of you will go out and support the Poker Player's Alliance, get involved in the discussions at Two Plus Two, Pocket Fives, Cards Chat, or better yet, contact your local lawmaker. Speak out. Because today they came for online poker; who knows what they'll come for tomorrow.

Tags: poker legislation, online poker, poker news, poker

28 comment(s)

Amen, and welcome back.

Thank you for your piece I have linked in on Twitter.

It seems that the government doesn't care about the money AMERICAN citizens are going to lose from this... Not to mention the BILLIONS of Dollars in Limbo...

Wanna fix the Budget Obama? Don't go after poker.. How about you Legalize Poker & Marijuana.. That would bring significant income to the country.

Yes, let's also legalize prostitution, arms dealing, cocaine smuggling that way we can make billions of dollars in taxes!!!! WOOHOO, let's make all the illegal things legal and TAX THEM ALL because that's the BEST SOLUTION!!!!

Ive got $17000 online that is all my money in the world I work a part time job and play poker, i have a kid, pay my taxes. i don't know where im going to get next months rent from AND i voted for obama who was supposed to be apoker player. never voting again... my buddy doeswnt even LIVE in the us and cant access his $ either..

@Lobsterkuhn: You seem to imply that online poker has negative impact on society. Could you provide some reasoning for your claim instead of ranting about things unrelated to poker.

Hello everyone, I just want to give the prospective of a foreigner who lived in the US for a while.

In France, there is a legislative body in charge of online gambling and betting, supposed to insure the integrity of the game. You can only play to the "officially licensed” poker rooms, which they monitor. I perfectly agree, this is a pretty strong form of censorship (you can't sometimes even access other websites...). Before you are allowed to play, you have to clear security, send your ID, address, an go through a strenuous administrative process (3 weeks average) hopefully only once.

Last bad piece of news, you can only play with players which abide to this set of rules and are under France jurisdiction: namely the French (that again is pretty damn restrictive).

The good now: Licensed website are monitored by the state, in terms of accounting and information they collect about you. They are legit (or at least the French branch of their holding) and pay taxes. They also have to post collateral to maintain enough flow to guarantee players' funds.

Even though it has many restrictions (which in my view just plain killed sport online betting), I believe applied to the US, where the field is way deeper, it is the worse of the two evils, government ban and unleashed poker websites, which according James 'own word "strayed from the beaten path when it comes to respecting the privacy of their users” (let alone their money management).

This system is about to be put through the test. Let’s see how it handles it. Last but not least, I agree with the community’s view which is to fight for the right to play poker online. There is nonetheless a cogent argument we (PPA, etc. whoever in charge) need to provide the layout for a “fair and safe” environment for player. How to do so remains to be seen

Regards, David

@Anonymous it's not clear what the effect of online poker is you could argue the effect is negative and people would nod their heads and act all wise like youre trying to do but nobody really knows you just don't. Is alcohol good for society no but we can do that online poker is the same, a vice, i can have a vice if i want, thats what being an adult is bro-

David how is the rake is out there in those games? playable? ps Great to see you back James

This has nothing to do with online betting, individual states are lining up as we speak to legalise and tax online poker. The main benificiaries will be the tradional gambling consortiums who now have a clear field to enter (no big three to compete against). The big three will never be licensed in the states. I am sorry for the people who work for those companies and the players whose funds are in danger but I have no sympathy for the owners/operators who sailed too close to the wind as regards bank fraud, money laundering etc. The other winners will be the European poker sites.

Geez! Welcome back!

America still has that Puritanism ethic that all fun is bad. When the people find something not entirely wholesome they want to do, the govt. not only makes it illegal, but creates a new federal police force to enforce that law instead of leaving it alone and letting adults be naughty if they want (hint - they want).

To exacerbate the problem, America at this moment in time is heading downhill towards a poverty stricken police state like a runaway beer truck.

The USA needs an enema and it's going to get one. This poker business is just a symptom.

This is what it takes to get you to post these days...

@Jeff Hende I don't play very much so I can't give you any actual rake off the top of my head, but they are, indeed, higher than they were when online poker was "illegal" (ie, not taxed).

There was an outcry amongst French players when the law kicked in, but it seems that, now that the dust has settled, the general consensus is that this legalized (and therefore, advertisable) form of online poker has attracted a LOT of fishes, making the game very playable, even with the higher rake.

I lost my entire $25 bankroll. I won it all fair and square in the freerolls.

They should go after alcohol. Them damn beer drinking alcoholics are always driving their cars into stuff they shouldn't drive into!

Best article yet. After the largest federally licensed banks raped U.S. taxpayers to the tune of $700+ BILLION, the administration scapegoats diabolical poker connoisseurs and balkanizes the entire community. State licensed poker will suck, especially for people who live in low population states-- hopefully they will be intelligent enough to form multi-state compacts. But we all know who stands to gain from this divide and conquer approach, and it certainly isn't any of the players.

I think after this action of the US Government many countries will interdict online poker, and online poker sites. There are billions of dollars that come across these sites every day, and poker players give the money to them. It is not good. Why should poker players who play for fun this game should enrich them?

Was about to forward your post to the players I know and help drum up support... until the "First they came for..." quote. Much of the rest of the post was informative and spot on but that's such an exaggerated use of a quote that refers to something so much more horrific, I would have been embarrassed to pass your article on. (I don't mean this as critically as it sounds, but tone of voice is difficult to convey in writing). If you make a post that doesn't include that, I would be very glad to pass it on to a large number of poker-playing friends and acquaintances in the hopes of continuing its spread.

From a Canadian who assumes it won't be long before our gaming suffers a similar fate.

Boo hoo. It's nothing more than players deserve for playing on these illegal sites in the first place. Looks like all you online poker hipsters got what you deserved and I for one am happy to see this type of gambling (that's what it is, GAMBLING) go BUH BYE. They passed the law making online poker illegal years ago. Did you think they weren't going to enforce it? :) :) :)

Seth: online poker isn't illegal. Are you really that stupid or is this some kind of level...?

Hate to be the guy pointing out the huge pink elephant in the room, but what does this mean for poker botting?

So is this what American hypsocrisy boils down to? You can invade any country you like, kill innocent civilians, but when it comes to Poker or bad words on TV, that's where the great US of A draws the line... truly a great nation to be admired and respected... NOT

I don't get it. There is so much other corruption out there - why are they focused on Poker? If they need money so bad (which they do), try cutting some of Congress' pay. It's not like they're doing much for it anyway.

The brick and morter casinos are behind this, they want the business here. The price is info for taxation of the players.

@Jeff Hende I don't play very much so I can't give you any actual rake off the top of my head, but they are, indeed, higher than they were when online poker was "illegal" (ie, not taxed).

There was an outcry amongst French players when the law kicked in, but it seems that, now that the dust has settled, the general consensus is that this legalized (and therefore, advertisable) form of online poker has attracted a LOT of fishes, making the game very playable, even with the higher rake.

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辞任したのは牧義夫厚生労働副大臣、森裕子文部科学副大臣、黄川田徹総務副大臣、主浜了総務政務官の4人。4日の持ち回り閣議で了承された。小沢元代表は同日夜、東京.赤坂の料理店で牧氏らと会食した。

 辞任を認めた理由について、藤村官房長官は4日の記者会見で「辞意が固かった」と説明した。しかし、民主党内では「続投させれば国会の空転を招くと考えたからだろう」との受け止めが支配的だ。

There was an outcry amongst French players when the law kicked in, but it seems that, now that the dust has settled, the general consensus is that this legalized (and therefore, advertisable) form of online poker has attracted a LOT of fishes, making the game very playable, even with the higher rake.

There was an outcry amongst French players when the law kicked in, but it seems that, now that the dust has settled, the general consensus is that this legalized (and therefore, advertisable) form of online poker has attracted a LOT of fishes, making the game very playable, even with the higher rake.

You can invade any country you like, kill innocent civilians, but when it comes to Poker or bad words on TV, that's where the great US of A draws the line... truly a great nation to be admired and respected... NOT

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