Scott Oliver
Game over? FBI shuts down three of the largest poker sites in probe that could mean the end of online gambling – and the loss of thousands of well paid jobs – in Costa Rica.
In a surprise move today: “Three of the largest online poker sites have been shut down by the FBI in a probe that could bring about the death of the internet gambling industry.”
The entire U.S. online poker industry has approximately 2.5 million Americans players betting around $30 billion annually.
The founders of PokerStars, Full Tilt Poker, and Absolute Poker were all charged in the action. They include Isai Scheinberg and Paul Tate of PokerStars, Ray Bitar and Nelson Burtnick of Full Tilt Poker, and Scott Tom and Brent Beckley of Absolute Poker. According to a statement released by the U.S. Department of Justice, law enforcement agencies and Interpol were in pursuit of the individuals in question.
According to a statement from the Justice Department, the founders of PokerStars, Full Tilt Poker, and Absolute Poker have been charged with “bank fraud, money laundering, and illegal gambling offenses.” In addition, “restraining orders were issued against more than 75 bank accounts utilized by the Poker Companies and their payment processors, and five internet domain names used by the Poker Companies to host their illegal poker games were seized.”
Three of the defendants are Canadians. One of them, Isai Scheinberg, 64, the founder of PokerStars – with “an estimated $1.4 billion of annual global revenue and some $500 million in profit, “has dual Israeli-Canadian citizenship and lives in the Isle of Man. Late in 2010 PokerStars, claims it has legal opinions from five U.S. law firms saying it is not violating any laws.
The indictment and civil complaint seek more than US$3 billion in civil money-laundering penaltiesand forfeiture from the poker companies and the defendants, the DOJ said.
“As charged, these defendants concocted an elaborate criminal fraud scheme, alternately tricking some U.S. banks and effectively bribing others to assure the continued flow of billions in illegal gambling profits,” Preet Bharara, U.S. attorney for the Southern District of New York, said in a statement. “Moreover, as we allege, in their zeal to circumvent the gambling laws, the defendants also engaged in massive money laundering and bank fraud. Foreign firms that choose to operate in the United States are not free to flout the laws they don’t like simply because they can’t bear to be parted from their profits.”
This could unfortunately be the final, deadly blow to the online gaming industry in San José and Santa Ana, Costa Rica which employs thousands of people who all earn well above the average salary.
Scott Oliver is the founder of WeLoveCostaRica and author of 1. Costa Rica Real Estate Scams & How To Avoid Them, 2. How To Buy Costa Rica Real Estate Without Losing Your Camisa, and 3. Costa Rica’s Guide To Making Money Offshore.
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