Is Online Poker Dead ?

Three of the biggest poker sites in the world were closed by the FBI in a move that could lead to the death of online gaming industry. Eleven people, including owners of Full Tilt Poker, Absolute Poker and PokerStars have been accused of bank fraud and money laundering.

In 2006, the U.S. Congress passed a law banning online gaming, but most sites have found ways to circumvent that law by using foreign banks, thus breaking the law, according to prosecutors.

“They lied to banks about the true nature of their business, and some have found banks willing to break the law", said and FBI official.

According to the FBI allegations, the companies arranged to receive money from U.S. players, masking operations as payments to non-existent sites and for merchandise such as jewelry or golf balls. Poker companies have tricked the U.S. banks to process billions of dollars, but some banks have quietly agreed with these schemes to hide illegal gaming operations.

This could be the death blow for the online gaming industry, which went through the roof  in the last decade, attracting about 15 million U.S. players.

The operation was launched in New York and aims at crimes like $3 billion money laundering, and tax penalties from the defendants. 76 bank accounts used by businesses from 14 countries used by the poker companies were blocked. Five Internet domains used by gaming companies to host their games were shut down by authorities.

While Pokerstars.com look very alive and well, Fulltiltpoker.com follows a misconfigured redirect and displays an error message instead of the actual site content, the banner on absolutepoker.com tells more about the charges:

  "Conducting, financing, managing, supervising, directing or owning all or part of an illegal gambling business.

Violation of these laws carry criminal penalties up to five years' imprisonment and a fine up to $250,000.

Properties, including domain names, used in violation of the provisions of 18 U.S.C. 1955 or involved in money laundering transactions are subject to forfeiture to the United States."