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3 Online Poker Sites Charged with Bank Fraud, Illegal Gambling

On Friday, PokerStars, Full Tilt Poker and Absolute Poker were charged with illegal gambling and bank fraud. The three sites are the largest in the U.S. And are all based overseas. 11 people have been accused of tricking banks into processing illegal revenue in the billions. So far, 75 banks used for online poker in 14 countries have been issued restraining orders.

After the Unlawful Internet Gambling Enforcement Act was enacted in 2006, the online poker companies began using fraudulent methods to trick banks into processing payments from the websites. This law prevents gambling institutions from taking payment that is any way in connection with participation of illegal online gambling. The Internet gambling sites would disguise the money received from its U.S. Players as various online purchases such as sports equipment or jewelry. The companies claimed all the money were a collection of the fee charged per hand played in online poker, called a “rake.”
Many companies such as Wynn Resorts Limited and Fertitta Interactive, had deals in place with some of the Internet gambling sites that would come into play when legalization and a gaming license requirement for Internet poker was enacted. Frank Fahrenkopf, chief executive of the American Gaming Association, said, “Tough law enforcement is the key to making such a system work, and the AGA supports strong enforcement against illegal online gambling activity in this country. But illegal activity — and the risk of consumer fraud, money laundering and underage gambling — will continue until the U.S. passes laws ensuring that only licensed, taxed and highly regulated companies can operate in the U.S. market.”
The indictment brought upon all the defendants amount to $3 billion in money laundering penalties and forfeiture. The FBI has seized all the domain names of each site. So far, they have shut down five illegal online poker sites.


Angelica Bee

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