Internet Gambling Companies Indicted for Fraud, Money Laundering

With the seizure of the websites, it is unclear what will happen to the funds of U.S. George, Utah, which allegedly processed more than $200 million for Full Tilt and PokerStars. “In exchange for this agreement to process gambling transactions, the banks received sizable fee income from processing poker transactions as well as promises of multi-million investments in the banks from Elie and his associates.”

Also indicted was John Campos, vice chairman of the board at SunFirst Bank, based in St. banks and effectively bribing others to assure the continued flow of billions in illegal gambling profits,” Bharara said in a prepared statement. and his associates were, however, able to persuade the principals of certain small, local banks that were facing financial difficulties to engage in such processing,” the indictment reads. “Meanwhile, some of the poker operators themselves have claimed that U.S.

New York prosecutors say they’ve issued restraining orders against more than 75 bank accounts in 14 countries used by the poker companies, which they say will interrupt the illegal flow of billions of dollars, according to The Associated Press.

Members of the conspiracy allegedly agreed to invest $10 million in SunFirst, which gave them a 30 percent stake in the bank, according to the indictment. George, Utah.

“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,” said Preet Bharara, the U.S.

Campos was arrested this morning in St.

The owners and operators of the websites all are outside of the United States and were not in custody.

The 52-page indictment also alleges that conspirators used electronic checks to try and disguise their payments.

The Justice Department has filed a civil complaint for money laundering that seeks $3 billion being held by the companies.

The indictment identifies four individuals as the payment processors — Ryan Lang, Ira Rubin, Bradley Franzen and Chad Elie.

The allegedly phony websites included online flower delivery shops and pet supply stores that would handle credit card payments to get funds from U.S. gambling laws do not apply to poker.

The indictment alleges that Elie was deeply involved in negotiating with banks to secure processing transactions. players who have accounts on the websites.

“This is a potentially game-changing moment for the online poker industry, as PokerStars and Full Tilt are, by quite some distance, the two largest operators not just in the U.S., but globally,” James Kilsby, Americas editor with the business intelligence service GamblingCompliance, told ABC News.

The issue of Internet gambling has been debated on Capitol Hill recently, with legislation being proposed both for and against it. In 2007, NETELLER, a firm that handled online gambling transactions, was charged by prosecutors from the New York U.S. who lied to United States banks about the nature of the financial transactions they were processing and covered up those lies through the creation of phony corporations and websites to disguise payments to the poker companies.”

“Previous DOJ enforcement efforts have honed in on sports betting operators and payment companies,” Kilsby said. “The defendants bet the house that they could continue their scheme, and they lost.”

Isai Scheinberg and Paul Tate of PokerStars, Scott Tom and Brent Beckley of Absolute Poker, and Raymond Bitar and Nelson Burtnick of Full Tilt Poker, the indictment claims, engaged in a scheme “to deceive United States banks and financial institutions into processing billions of dollars in payments for the poker companies, by, among other things, arranging for the money received from United States gamblers to be disguised as payments to hundreds of non-existent online merchants and other non-gambling businesses.”

Federal prosecutors and FBI agents also have obtained a district court order to block 76 bank accounts and five Internet domain names associated with the poker websites.

“These defendants concocted an elaborate criminal fraud scheme, alternately tricking some U.S.

Justice Department officials said they were in contact with local law enforcement agencies in those countries and Interpol to seek their arrest.

“Some of the defendants found banks willing to flout the law for a fee,” Janice Fedarcyk, the assistant director in charge of the FBI’s New York Field Office, said in a prepared statement. banks that prohibited them from handling financial transactions connected to online gambling.

Franzen was arrested March 16 in Chicago on a previously issued criminal complaint and is scheduled to have an arraignment in New York on Monday. “We allege, in their zeal to circumvent the gambling laws, the defendants also engaged in massive money laundering and bank fraud.”

Eleven individuals were charged over their involvement running PokerStars, Full Tilt Poker and Absolute Poker for violating the 2006 Unlawful Internet Gambling Enforcement Act. . Attorney’s Office but entered into a deferred prosecution agreement with the U.S. attorney for the Southern District of New York, where the case was filed.

The owners and founders of the three largest online gambling sites in the United States have been indicted and charged with bank fraud, money laundering and illegal gambling offenses. It seems clear from today’s action that the Justice Department doesn’t agree.”

According to a federal indictment, the owners of the companies sought ways to get around restrictions placed on U.S. In April 2010, Campos also allegedly sought a $20,000 bonus that he allegedly called an “invoice” for “Check and Credit Card Processing Consulting.”

The indictment alleges the poker-company owners “relied on highly compensated third party payment processors … An attorney for Elie could not be located by ABC News. government and returned such funds to their owners. customers.

“Chad Elie … PokerStars is registered in the Isle of Man, Full Tilt is registered in Ireland and Absolute Poker and its associated companies originally was founded in Costa Rica but is now registered in Antigua. Elie was arrested in Las Vegas, where he was slated to appear before a federal magistrate

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