$30M in Poker Players' Money Seized

[wysimdnwyg]

I can't believe this hasn't been posted already, but I also can't find it if it has.

"Online poker winnings are frozen, group says
Government freezes accounts of payment processors

updated 9:43 p.m. CT, Tues., June 9, 2009
WASHINGTON - An advocacy group for online poker said Tuesday that the federal government has frozen more than $30 million in the accounts of payment processors that handle the winnings of thousands of online poker players.

The Justice Department long has maintained that Internet gambling is illegal, a view that the poker group challenges.

The Poker Players Alliance told The Associated Press that the U.S. attorney for the Southern District of New York instructed three banks — Citibank, Goldwater Bank and Alliance Bank of Arizona — to freeze the accounts.

Documents obtained by the AP show that a magistrate judge in the district issued a seizure warrant last week for an account at a Wells Fargo bank in San Francisco, and that a federal prosecutor told Alliance Bank to freeze accounts.

In a letter dated Friday and faxed to Alliance Bank, the prosecutor said accounts held by payment processor Allied Systems Inc. are subject to seizure and forfeiture “because they constitute property involved in money laundering transactions and illegal gambling offenses.” The letter was signed by Arlo Devlin-Brown, assistant U.S. attorney for the Southern District of New York."

Full Story:
http://nbcsports.msnbc.com/id/31192062/


The PPA is currently preparing to litigate this case, which some are already suggesting may set the standard of legality of online poker.

From the PPA's statement:
"There are many legal issues that question the merit of the Southern District’s actions. Of greatest concern is that, in at least two cases, these actions were taken without first obtaining a seizure warrant. Seizure of money without judicial authority and litigation tactics inconsistent with previously stated Department of Justice policy appear to be the type of conduct that the Department has recently committed to change. Accordingly, the PPA on June 8
th
wrote to the prosecutor in charge of the matter and raised appropriate challenges and constitutional concerns with the actions taken to date.“We are also concerned that the Southern District has selectively taken action against online poker when the current law regarding the activity is far from clear, and policies from various levels of government are inconsistent at best. In fact, no federal or state court has ever found a payment processor or a player accessing an Internet poker site to have violated the federal laws alleged by the Southern District in this case."

[MNDemNY]

1. Too bad. If you engage in illegal activity, you've got to know it might not work out.

I have no sympathy for those who lost money here.

[Taverner]

2. Is it illegal though?

I'm not sure any bans would hold up in court

[Lance_Boyle]

3. online poker is not illegal activity,

turd

[MNDemNY]

7. Yes, it is.

Turdier.

[wysimdnwyg]

6. Online poker is NOT illegal

There are two main classes of online gaming (really three, but we'll focus on the two biggies here), poker and sports betting. Sports betting is the most commonly used example by the government for the restriction and prosecution of online gaming. However, poker is considered by many (including most who actually play the game) to be primarily a game of skill. While the large number of amateurs who compete now have overwhelmed the professionals, the line from the movie Rounders is still appropriate for many games, "Why do you think the same five guys make it to the final table of the World Series of Poker EVERY YEAR? What, are they the luckiest guys in Las Vegas?"

The legality issue stems from a common misconception of the UIEGA. This legislation says nothing about online poker. It was intended to prevent the passing of money to and from online gaming sites, which are primarily located in other countries. However, there are several ambiguities in the law (which has not even gone into effect yet), to the point that the PPA and many others claim it does not apply to online poker.

Currently online poker fits into a grey area of the law, and this issue has the potential to define online poker's status as either illegal or not.

[MNDemNY]

8. Gray, very gray.

[Lance_Boyle]

9. "gray" "very gray" or "illegal"

Which is it now, oh sage interwebs legal expert?

[MNDemNY]

10. Illegal.

[Romulox]

15. Nope, the transfer of internet gambling winnings *clearly* is, however.

And poker is clearly covered by the Act.

"However, poker is considered by many (including most who actually play the game) to be primarily a game of skill. "

Doesn't matter what people "consider" it. The definition set out in the Act clearly embraces poker.

§ 5362. Definitions

In this subchapter:

(1 ) BET OR WAGER.
The term 'bet or wager'—

(A) means the staking or risking by any person of something of value upon the outcome of a contest of others, a sporting event, or a game subject to chance, upon an agreement or understanding that the person or another person will receive something of value in the event of a certain outcome;

Whether it requires skill or not, poker is clearly a "game subject to chance". Moreover, poker is "risking...something of value upon the outcome", in hopes that one will "receive something of value".

[JackRiddler]

17. You're so tough! We all swoon!

[backscatter712]

4. Why is internet gambling illegal?

My bet is that the Vegas casinos pushed through that law - they didn't want the competition.

Don't believe for a second that the .gov gives a shit about morality when they enforce these laws...

[aikoaiko]

5. Congress has got to get with the times.

Internet gambling should be legal.

[Dappleganger]

11. Legal, and TAXED.

to the hilt.

I am all for it--not a gambler, but think it should be legal for any adult who wants to participate.

[aikoaiko]

13. It should just be taxed like any other regular income, IMHO.

[votingupstart]

12. for the legal and taxed

if an adult wishes to gamble a little then have at it - my opinion based that i play black jack about 1 time every 4 years so i am an expert on gambling you see.

[BeFree]

14. Patriot Act allows this

We gambled with the Patriot Act, giving so much power to the feds. Who is now surprised they act this way?

[JackRiddler]

16. "They instructed Citibank" - which is a real criminal. When are they freezing those assets?