Idiots in the US Department of Justice: Threat to PokerStars, Full Tilt, Absolute Poker

by PokerAnon ~ April 15th, 2011. Filed under: poker.


* Modified April 26th, 2011 *

I was wondering why my site links to PokerStars and FullTilt weren’t working. I thought it was something on my end, but it turns out it’s much stupider that than.

The US government has seized the domains for PokerStars.com, Fulltilt.com and UltimateBet.com. The .net version, Pokerstars.net, still seems to be operational. Claims of money laundering? Bank fraud? Idiots.

http://www.pokernews.com/news/2011/04/online-poker-big-three-indicted-10218.htm

To see the actual indictment:

http://www.justice.gov/usao/nys/pressreleases/April11/scheinbergetalindictmentpr.pdf

The latest is that they’ve arrested 11 people connected with the three sites so far as well as frozen bank accounts.

Players residing the US can no longer play on PokerStars. Full Tilt seems to be still allowing them on, but player to player transfers are disabled.

* * *

Updating April 17, to the best of my knowledge:

  • Play money allowed, no real money for players in the US on PokerStars and Full Tilt
  • No player to player transfers allowed for those players
  • Cashout requests allowed, but when those arrive is uncertain
  • All the big, repectable sites keep the player’s money in trust, so your money should be safe. But they have massive cashout requests so it may take some time to process
  • PokerStars is currently running their main website from their European version; www.pokerstars.eu (Update, April 18: Full Tilt is doing the same via www.fulltiltpoker.eu)

As for the games themselves:

  • Volume on those sites are down. The freerolls still fill up, but if you’re one of those people still trying to grind a bankroll from freeroll, they’re probably easier to get into that before.
  • Guarantees on prize pools in tournaments have already been adjusted to compensate for expected smaller sizes. I played a $3.30 rebuy $6,000 guaranteed with only 150 runners on Black Friday thinking that I’d get an overlay. But with late registration running for a full hour, plus rebuys, plus top ups the total registration was still 450, 1,550 rebuys, and 250 topups so Stars still didn’t have to cough up any money. Ended up winning $21, covering my 3.30 + 3.00 + 3.00, but I wouldn’t have played if I’d know that there was going to be no overlay. Maybe I wasn’t the only one.
  • Both sites are creating updates to their software every day.
  • The Full Tilt software updates do not always download; possibly the server is overloaded, or it’s a backup server that can’t handle the volume. Updates can be downloaded from other versions of their site, like www.fulltiltpoker.co.uk

Things to remember:

  • Again, all the big, repectable sites keep the player’s money in trust, so your money should be safe.
  • PartyPoker was once the biggest online poker site until the 2006 Unlawful Internet Gambling Enforcement Act (UIGEA). It has survived as a non-US poker site. I fully expect PokerStars and Full Tilt to be able to do the same. Absolute’s future is not so absolute.
  • Tilt and Stars were big sponsors of televised poker (The Big Game, Poker After Dark). If the US market becomes dead to them they’ll have no reason to continue to advertise within the US. (Update, April 18: ESPN has already begun putting programming on hold)
  • Tilt and Stars currently have some pretty big name (and relatively wealthy) pros. I saw Jen Harmon tweeting that she normally played poker online on Saturday afternoons and didn’t know what to do. Other pros like Nananoko make their entire living playing online. People like Daniel Negreanu have pretty decent public profiles (though Kid Poker has tweeted that he’s been told to withhold comments at this point).
  • When the UIGEA came out I had just started playing poker. I hadn’t made any deposits or wasn’t even playing freerolls. I was just happily playing play money and still trying to get familiar with the rules of the game. So when the first big throttling happened I was aware but not closely involved. Poker will survive, PokerStars and Full Tilt will survive, players will likely get their money back. Whether the remaining US friendly sites gobble up the business like these two did when PartyPoker pulled out of the market is less clear simply because of the difficulty the DOJ is creating for making deposits. And the recreational and casual players need it to be easy and safe-appearing or they’re not going to bother playing. Estimates were that 80% of PokerStars’ client base was non-US but only 50% of Full Tilt’s customers were non-US and that seems to be confirmed by site activity drops from each site over the past few days. This implies that Stars is going to have an easier time adapting than Tilt since they automatically lose less of their existing customer base.
  • When I did decide to make my first $50 deposit it was in December of 2006, two months after the UIGEA. I remember that by that point it was pretty clear that 1) online poker in the US was continuing, and 2) PokerStars had the lead in both US and world online poker domination which is why I chose to start at PokerStars. In other words, things should clear up pretty quickly.

Best summary so far: Gary Wise at ESPN. ESPN has canceled poker related advertising and programming.

* * *

Update at Tuesday, April 19, 2011:

  • PokerStars and Full Tilt allowed to “reactivate” their websites in order to facilitate the return of funds to US based players
  • DOJ claims there was no requirement to freeze player accounts, and will work with the companies to facilitate the return of funds. Though, since they’ve attacked the payment processing companies that the poker sites used, I don’t know how they plan to do this.
  • Atm neither www.pokerstars.com nor www.fulltiltpoker.com have the FBI warning any more, but neither do they return anything from the poker sites. That may be a delay in redirecting the domains to the correct IP, or the sites haven’t had the chance to put anything up yet.

* * *

Update at Tuesday, April 26, 2011:

  • PokerStars has enabled cashouts for US based players. Get your money out! But, make sure you include your T$; T$ have been converted 100% into cash, and you may only have one chance to request a cashout, so make sure you include everything.
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