The Beginning of the Death of Online Poker in the US

[MJ4H]

Well, yes. If you fail to make a living at it, you aren't making a living at it.

The whole point is that molson was saying we are assuming everyone is making a killing at it. No, we aren't. When we discuss those that make a living at it, though, we are talking about the ones that are, quite by definition, winning. There are, of course, those that aren't winning. Yes, likely there are more of them than the winners. No one was assuming everyone is winning. That is what I was talking about.

[MJ4H]

Originally Posted by molson

Really? This was shocking? The title of this thread is "the beginning of the death of online poker in the US" and the thread is almost 5 years old.

Yes. That kind of thinking was largely viewed as fear mongering at the time. The UIGEA was the impetus of the thread and has nearly been overturned, and is largely viewed as on its way out as many efforts to regulate have been in the works for a good while. Things were looking way up, not down, before this past Friday. Everything will still likely be fine in the end, but this is just an ugly way to do things.

[molson]

Originally Posted by MJ4H

The whole point is that molson was saying we are assuming everyone is making a killing at it.

My point was really just that the people on facebook saying that they can't feed their kids anymore are idiots and unfit parents. The response to that was, "but you can make a living doing this!" And i thought, "well, some can, but some parents who try to have obviously failed, and now, even the ones that are good at it have failed". And the response to that was "we're only talking about those who ARE successful at it", And then there was something about having a "right to make a living". Now I'm just confused. But I maintain that if you're a parent you should develop some non-internet gambling job skills and not stake the future of your family on pokerstars (but I'm someone who thinks that the financial security threshold as to when people should have kids is WAY higher than what Americans believe generally).

[JonInMiddleGA]

Originally Posted by Lathum

You are kidding yourself if you think there isn't a very large section of the population who if they lost their source of income today would be in line at a foodbank tomorrow.

Didn't know we were talking about them, thought this was about some highly skilled professionals, virtual paragons of brilliance due to their magnificent skill set. Those are generally in demand & certainly ought to be successful enough to plan for circumstances where mobility was going to be a required.

Why should someone who makes a living at online poker be considered any different?

Because most of them aren't facing the imminent end of their "job" through direct law enforcement action?

Remember, this subplot isn't about whether it ought to be legal, it's about the wisdom of continuing to "feed your kids" with something that's an endangered species that is steadily sliding toward extinction.

[Radii]

Originally Posted by molson

My point was really just that the people on facebook saying that they can't feed their kids anymore are idiots and unfit parents.

I came in after the conversation spiraled out a good bit, so yeah, just to make sure its clear, I 100% agree with you here.

[HeavyReign]

I think the frustrating part is that if you asked most poker players on Thursday, they would've said we were slowly heading for legalization. Since the Neteller shutdown, there hasn't really been much indication that their "jobs" were in jeopardy. Things like the Wynn deal with Pokerstars and Washington DC passing an online poker law with other states also working on it made it seem like things were moving forward toward legalization.

[larrymcg421]

How about this perspective?

Poker players were playing the odds. And if they can't feed their kids right now, then they miscalculated.

When deciding if you can make a living at it, your X (profit expectation) has to exceed Y (income needed to feed family). But poker players weren't playing in a vacuum. The UIGEA has been there all along. The players thought the feds were bluffing, when they intended to call all along. The fact that the UIGEA existed means the players should have increased their expectation of Y so they could store some more money way in case something like this happened. If their X was unable to meet that new expectation of Y, then continuing to play poker in this climate was a mistake.

And I say this as someone who hopes the gov't butts the fuck out of online poker.

[Lathum]

Originally Posted by fantom1979

Lathum sounds like I did after they shutdown yessmoke.com

I have no idea what this means. If you are saying I am jonesing you could not be more wrong, I live in Washington State. Stars and FTP pulled out of here long ago.

[lcjjdnh]

Originally Posted by larrymcg421

The UIGEA has been there all along. The players thought the feds were bluffing, when they intended to call all along.

I'm not saying I agree with the argument I'm about to make, but we do recognize reliance interests in our legal system. For instance, in civil cases, we have rules of estoppel. That is, if you lead someone to believe that you will not enforce your right to sue them-even through silence in some cases-you lose that right. This is, of course, a criminal and not civil case, but the underlying justification of allowing people to act on their reasonable expectations exists.

Certainly, it's fair to say if something is illegal, it's illegal. But I also think it's plausible to argue that there is a difference between doing something illegal underground and not being prosecuted, and doing something illegal in full view and not being prosecuted. The person in the second case might start to believe the government was perfectly fine with what he was doing.

[larrymcg421]

Originally Posted by lcjjdnh

I'm not saying I agree with the argument I'm about to make, but we do recognize reliance interests in our legal system. For instance, in civil cases, we have rules of estoppel. That is, if you lead someone to believe that you will not enforce your right to sue them-even through silence in some cases-you lose that right. This is, of course, a criminal and not civil case, but the underlying justification of allowing people to act on their reasonable expectations exists.

Certainly, it's fair to say if something is illegal, it's illegal. But I also think it's plausible to argue that there is a difference between doing something illegal underground and not being prosecuted, and doing something illegal in full view and not being prosecuted. The person in the second case might start to believe the government was perfectly fine with what he was doing.

Well no, I completely understand what you're saying. I'm not going to say I saw this coming or expected it in any way, so I don't blame poker players for not seeing it either. However, the chance of it happening was certainly greater than zero. Until that law was repealed, players should've been prepared for the worst just in case. The ones crying about feeding their family clearly did not.

[molson]

The U.S. government did seize $30 million worth of online poker accounts in 2009, and federal law (and some states' law) does require ISPs to block gambling sites (most of them have figured out ways around it). This is stuff I would make it my business to know if my kid needed poker money to eat.

[Lathum]

Originally Posted by molson

The U.S. government did seize $30 million worth of online poker accounts in 2009, and federal law (and some states' law) does require ISPs to block gambling sites (most of them have figured out ways around it). This is stuff I would make it my business to know if my kid needed poker money to eat.

You fail to mention that the poker sites made good on all those funds seized and not one person lost their money.

[molson]

Originally Posted by Lathum

You fail to mention that the poker sites made good on all those funds seized and not one person lost their money.

Well that's good. Assuming that's the case this time too no kids will starve (they'll just be hungry for a while)!

[Lathum]

Originally Posted by molson

Well that's good. Assuming that's the case this time too no kids will starve (they'll just be hungry for a while)!

lol, this time I think it may be tough for people to get their money

[Marc Vaughan]

With all this kerfuffle going on .... errr why is Online Poker at the only Online Poker Room endorsed by Doyle Brunson still up and apparently 'welcoming US players' ?

[MJ4H]

Their owner wasn't indicted?

It is important to remember that online poker is still not illegal.

[Marc Vaughan]

Originally Posted by MJ4H

Their owner wasn't indicted?

But how/why not exactly? - its blatantly a poker website, taking money from US players (via. credit cards) and is still active and just as legal/illegal as the others surely .... its not like its particularly hard to spot I'd have thought ..

It is important to remember that online poker is still not illegal.

tbh I've never quite understood exactly how things stand over here - or indeed the logic behind the indictments, its not 'illegal' to play online poker but the poker providers seem to have to play games to get credit cards allowed on their sites .... which is in itself illegal?

[MJ4H]

Originally Posted by Marc Vaughan

But how/why not exactly? - its blatantly a poker website, taking money from US players (via. credit cards) and is still active and just as legal/illegal as the others surely .... its not like its particularly hard to spot I'd have thought ..

Online poker is not illegal. Money laundering and fraud are.

[MJ4H]

For the record, there seems to be continuing confusion about what exactly the charges were, here is a quick summary of the charges, taken from a poster on 2+2:

The defendants
The indictment names eleven defendants (and there could be others in related indictments that have yet to be unsealed). Those eleven include:

-the founder and principal of Pokerstars (Isai Scheinberg)
-the founder and principal of Fulltilt (Raymond Bitar)
-founders and principals of Absolut (Brent Beckley and Scott Tom)
-an executive in the payment processing departments of both Stars and Fulltilt (Nelson Burtnick)
-employee in the payment processing department of Stars (Paul Tate)
-two guys who acted as intermediaries between “poker processors” (i.e., people and entities willing to process payments and the companies (Ryan Lang and Bradley Franzen)
-guy who helped companies find poker processor
-guy who was a poker processor, in that he processed payments for the companies by disguising the payments as payments to phony internet merchants (Ira Rubin)
-guy who opened bank accounts in US through deceptive means (Chad Elie)
-vice chair of a bank in Utah, which processed payments for Stars and Full Tilt (John Campos)

Background
Starting around 2001, credit card companies required banks to apply a particular code to internet gambling transactions. Some banks decided not to extend credit to customers for gambling, automatically declined transactions with that code. Thus, even before UIGEA was enacted in 2006, most US banks blocked transactions with that code. A large part of the indictment is premised upon the claim that the defendants directed others to apply incorrect transaction codes to gambling transactions, thereby creating the false appearance that the transactions were unrelated to gambling.

This was accomplished several ways.


Fraudulent credit card processing
To begin with, the defendants employed“fraudulent credit card processing,” in two specific ways.

The first method was by creating phony companies (flower shops, pet stores, etc.) that would initiate the credit card charges. (The indictment specifies that Full Tilt and Absolute employed this method). Becuse the credit card companies usually caught on after a while, the defendants relied on a supply of stand-by phone merchants (twenty or more).

The second method (by each company) was to use pre-paid cards (including phone cards). They would load those cards with funds from the gamblers, without using the necessary code. They even created fake web sites and reviews of the cards, to make it appear that the cards had other legit purposes.

Fraudulent E-Check processing
The second category of conduct involved “fraudulent e-check processing.”

The indictment explains that the Automated Clearinghouse System (ACH) required merchants to open accounts in US. The companies turned to third-party processors to open those accounts, so that they would process e-check transactions using names of phony companies.

To accomplish this, the companies agreed to pay the processors much higher fees than would ordinarily be charged for e-checks. The processors worked with the sites to disguise the fact that the transactions actually involved gambling proceeds.

More specifically, the processors opened bank accounts in the US, pretending that the accounts would be used for a wide variety of merchants (but not gambling). The various defendants would then create phony corporations and websites, so that money that was debited from customers’ (player’s) bank accounts would appear to be consumer payments to non-gambling businesses.

Here is one interesting tidbit. Players sometimes got confused by seeing names of phony companies on their accounts. This resulted in email inquiries to the fake companies. Responses would come directly from the pokersites (specifically, pokerstars). And because this process resulted in some “administrative” difficulties, pokerstars had to modify its software.

“Transparent processing”
The third category of conduct involved “transparent processing,” which was invoked after the e-check processing operations collapsed in late 2009. Simply put, the defendants stopped lying to the banks and asked them to participate directly.

The companies turned to processers they had used before (including Chad Elie, even though the companies had sued him for $4 million before). Elie was able to persuade small banks (who were in financial distress) to process the payments in exchange for sizable investments in the banks. The indictment in particular discussed one 10 million investment/payoff.

[RainMaker]

Originally Posted by MJ4H

Online poker is not illegal. Money laundering and fraud are.

Depends who is doing it.

[Comey]

According to a DOJ document, US players will be able to withdraw from FT and PS. UB/AP has not opted into the agreement as of yet.

[Lathum]

Originally Posted by Comey

According to a DOJ document, US players will be able to withdraw from FT and PS. UB/AP has not opted into the agreement as of yet.

Which says to me the players weren't doing anything wrong all along, good news IMO.

I really hope this paves the way for legeslation and regulation.

[HeavyReign]

REALLY hoping AP gets in on the agreement. Since we couldn't play stars or tilt here that's where my money is at the moment.

http://www.justice.gov/usao/nys/pres...reementspr.pdf

[Mizzou B-ball fan]

Originally Posted by Lathum

Which says to me the players weren't doing anything wrong all along, good news IMO.

I really hope this paves the way for legeslation and regulation.

The U.S. government is going to need to work quickly to avoid new loopholes that will likely be exploited if they don't move to regulate and make poker online legal. Otherwise, they'll be doing this same thing in a few months with only a weak law to back them up.

I'd be shocked if they ever get a conviction. They'll be lucky to get a dime from these companies.

[Lathum]

Originally Posted by HeavyReign

REALLY hoping AP gets in on the agreement. Since we couldn't play stars or tilt here that's where my money is at the moment.

http://www.justice.gov/usao/nys/pres...reementspr.pdf

I have been playing on BoDog, I requested their debit card today to do cash outs. Been crushing 2-4 there lately and want to get some money off while I still can.

At 2500 you can do a bank wire transfer, but in the current climate not crazy about that.

[Lathum]

Originally Posted by Comey

According to a DOJ document, US players will be able to withdraw from FT and PS. UB/AP has not opted into the agreement as of yet.

From my buddy Faraz Jakas facebook page

U.S. Online Poker Players Will Get Their Money Back - Nathan Vardi - The Jungle - Forbes

[RainMaker]

Originally Posted by Lathum

I have been playing on BoDog, I requested their debit card today to do cash outs. Been crushing 2-4 there lately and want to get some money off while I still can.

At 2500 you can do a bank wire transfer, but in the current climate not crazy about that.

How do you get their debit card? I don't see it anywhere in the account. Is it only for poker? I use Bodog as my Sportsbook. Not worried in the least about my money anymore.

[Lathum]

Originally Posted by RainMaker

How do you get their debit card? I don't see it anywhere in the account. Is it only for poker? I use Bodog as my Sportsbook. Not worried in the least about my money anymore.

When I went to the payout option it was there. I think you can get it through the sportsbook as well.

[Lathum]

dola- you have to request a cashout first though

[Suicane75]

When I won the $30,000 tourney they tried to pay me off in American Express Gift Cards. I politely declined and waited for a check. But this was during one of the darker periods.

Edit: $30,000, not $100,000. Although that would of been nice.

[panerd]

Originally Posted by Libertarian Party

Libertarians speak against Obama's War on Poker

WASHINGTON - Following the Obama administration Justice Department's April 15 shutdown of three online poker sites and indictment of their executives, Libertarian Party Chair Mark Hinkle said, "The Obama administration has just trampled on the rights of millions of Americans."

Hinkle continued, "This is also a scary reminder of President Obama's vision of a government with the power to shut down websites it doesn't like, before a trial has even started.

"Even worse, shutting down this peaceful, honest commerce further weakens our economy.

"We Libertarians believe that adults have the right to gamble with their own money. Government has no business interfering. The Obama administration should drop these charges and restore the websites. Congress should repeal the laws that prohibit gambling, whatever the format.".

I know they will never win an election and people need to keep the D/R fight going to the death but I find it refreshing that one party realizes there are issues that can actually be discussed instead of just being blown off. Regardless of if you agree or not the D's and R's don't seem to even spend a minute on this topic. Something to think about.

[Lathum]

Originally Posted by Suicane75

When I won the $30,000 tourney they tried to pay me off in American Express Gift Cards. I politely declined and waited for a check. But this was during one of the darker periods.

Edit: $30,000, not $100,000. Although that would of been nice.

This was a really bizarre, vague post that I thought was a joke at first until the edit.

WHO tried to pay you off in gift cards and when?

I have been cashing out of stars and FTP literally since their inception and never once heard of anything like this happening.

[Comey]

Originally Posted by Lathum

Which says to me the players weren't doing anything wrong all along, good news IMO.

I really hope this paves the way for legeslation and regulation.

Well...part of the agreement is that the US market is closed to FTP and PS forever. I'm not entirely sure how to interpret that.

[Suicane75]

Originally Posted by Lathum

This was a really bizarre, vague post that I thought was a joke at first until the edit.

WHO tried to pay you off in gift cards and when?

I have been cashing out of stars and FTP literally since their inception and never once heard of anything like this happening.

Bodog. The total was something like $7500. When I requested a cashout I got an email asking if I would take a few grand of it in American Express gift cards. I declined and had to wait a week or two for my first check. I think they sent a total of 5 or 6 checks over the span of a couple months.

If I recall there were some problems going on with one of their processors at the time and people were waiting quite a bit for their payouts.

[timmynausea]

Here's one elected politician commenting, at least:

Rep. Barney Frank (D-MA) had some harsh words for Friday’s government crackdown on the major online poker sites. In an interview with The Hill, Frank called the indictments “an incredible waste of resources.”

Using witty poker lingo, Frank said the feds were “protecting the public from the scourge of inside straights,” and that the government should “go after the people responsible for empty houses, not full houses.” Frank made it clear that he didn’t endorse violating the law, but he thinks law enforcement should be working on other things.

[Radii]

Barney Frank has been one of the only outspoken politicians on this the whole way pretty much.

[timmynausea]

I guess I'll throw it out there - I have made a living as a poker affiliate (running poker ads on websites and getting paid for conversions) for the past 6.5 years, so this is a big deal for me. In fact, with the immediate loss of income, I am giving up on my mortgage and letting my house go into foreclosure. It's more complicated than it sounds, but essentially it makes more sense to protect my savings and move on rather than dump it into a house in Michigan that is losing value faster and faster. In any case, the last several days have been really dramatic and stressful.

I did, of course, know this was possible. The UIGEA was enacted literally 2 months after we closed on our house, so it was just bad timing for me in that way, and that did hurt my business quite a bit. Thankfully I do still have some savings, so I will come out of it fine.

Oh, and if any poker players want to move over to the Merge Network, I can offer 35% rakeback and 200% deposit bonus up to $1200. Your business would be greatly appreciated. PM if interested.

[fantom1979]

..... and another vacant house in Michigan. I can hear the value of my house continuing to get sucked away.

[Logan]

Best of luck timmy.

[Mizzou B-ball fan]

FWIW.......online poker hasn't created any increase in problematic gambling. Gamblers are going to scratch their itch whether it's online or otherwise.

Harvard Study Reports No Increase in Gambling Addiction

[RainMaker]

Originally Posted by timmynausea

I guess I'll throw it out there - I have made a living as a poker affiliate (running poker ads on websites and getting paid for conversions) for the past 6.5 years, so this is a big deal for me. In fact, with the immediate loss of income, I am giving up on my mortgage and letting my house go into foreclosure. It's more complicated than it sounds, but essentially it makes more sense to protect my savings and move on rather than dump it into a house in Michigan that is losing value faster and faster. In any case, the last several days have been really dramatic and stressful.

I did, of course, know this was possible. The UIGEA was enacted literally 2 months after we closed on our house, so it was just bad timing for me in that way, and that did hurt my business quite a bit. Thankfully I do still have some savings, so I will come out of it fine.

Oh, and if any poker players want to move over to the Merge Network, I can offer 35% rakeback and 200% deposit bonus up to $1200. Your business would be greatly appreciated. PM if interested.

Sorry to hear. I was heavily into poker affiliate stuff many years ago when I got out of college. Even had a site that was ranked top 10 for terms like online poker and such during the heyday. I got a bit scared years ago and sold off many of them to the actual poker sites (who were willing to pay good money up front to cut out the middle man).

I'm sure the value of whatever sites you were running are down, but you may want to see if you can sell to some of the sites still welcoming U.S. players. If you have a stable income from the sites over a duration of time, they'll offer you a deal.

[RainMaker]

Originally Posted by Mizzou B-ball fan

FWIW.......online poker hasn't created any increase in problematic gambling. Gamblers are going to scratch their itch whether it's online or otherwise.

Harvard Study Reports No Increase in Gambling Addiction

Yeah, most people I know who play do it for entertainment. Have a couple hundred bucks and dick around when they're bored.

The "online poker" turns us into degenerative gambler stuff is just like the "porn turns us into rapists" crap that is spewed out.

[MacroGuru]

Originally Posted by timmynausea

I guess I'll throw it out there - I have made a living as a poker affiliate (running poker ads on websites and getting paid for conversions) for the past 6.5 years, so this is a big deal for me. In fact, with the immediate loss of income, I am giving up on my mortgage and letting my house go into foreclosure. It's more complicated than it sounds, but essentially it makes more sense to protect my savings and move on rather than dump it into a house in Michigan that is losing value faster and faster. In any case, the last several days have been really dramatic and stressful.

I did, of course, know this was possible. The UIGEA was enacted literally 2 months after we closed on our house, so it was just bad timing for me in that way, and that did hurt my business quite a bit. Thankfully I do still have some savings, so I will come out of it fine.

Oh, and if any poker players want to move over to the Merge Network, I can offer 35% rakeback and 200% deposit bonus up to $1200. Your business would be greatly appreciated. PM if interested.

I did the same in the adult industry for a bit but I sold everything and got out when they started having processor issues and visa and mc were thinking about leaving...best and dumbest move I made in a long time.

I don't think I would be doing what I am doing now, I would probably be running that business as it was generating serious income, but I can tell you this...having kids makes me realize I was smart to get out.

[Doug5984]

I used to play a lot of poker on line years ago when I was in college- over the long run I probably lost around $200 over the course of 3 years... (made a lot more than that in live games but thats not the point of the story) now that I have a real job I simply don't have the time to play that much but I would love to have an account set up and play a couple times a month when I had some down time- it's a fun engaging game and the money adds a little extra thrill. Playing for free is not an option as a few people won't take it seriously and it ruins the whole game. I don't understand why this is such a bad thing in the governments eye. If they are so butt-hurt over on line poker why not just regulate it a little, and put a sin tax on it. (Which I also think is unfair but would be willing to do that if it meant I could play again).

As a working adult I should be able to waste my money however I see fit. I can cash my paycheck go to the local gas station and spend a few hundred dollars on lotto, or scratch off. I can go to a titty bar waste a few hundred there, I can give it all away if I wanted- but I can't play a game of on-line poker. Now if I wanted to play I'd have to drive an hour or so to the casino, and it's so smoky in there I don't even bother anymore.

[SirFozzie]

Black Friday Part 2:

Pokerstars in Costa Rica raided, but apparently given all clear,

Absolute Poker/UltimateBet raided, owners have apparently disappeared and are not paying employees..

[DaddyTorgo]

Originally Posted by MacroGuru

I did the same in the adult industry for a bit but I sold everything and got out when they started having processor issues and visa and mc were thinking about leaving...best and dumbest move I made in a long time.

I don't think I would be doing what I am doing now, I would probably be running that business as it was generating serious income, but I can tell you this...having kids makes me realize I was smart to get out.

You can actually make a full-time living doing that for porn or poker?

Not asking to be flip - I just honestly didn't realize it was a full-time thing for people.

[JediKooter]

Hmmmm...I'm single and have no kids and would like to make some extra income. Tell me more about this online porn gig.

[MacroGuru]

Originally Posted by DaddyTorgo

You can actually make a full-time living doing that for porn or poker?

Not asking to be flip - I just honestly didn't realize it was a full-time thing for people.

Yeah...I know he isn't hush about it, it's what icy does full time (adult).

I have honestly thought about getting back into it, I know the web and SEO very well and could probably get myself back up to where I am self sustainable pretty quickly. (Understand my kids don't live with me anymore)

I know several people making a full time living doing it for porn, poker, amazon and other programs, it's a tough market now, but still doable. It's not a part time gig like it used to be, it's full time + now if you want to be successful.

[EagleFan]

This sucks!!! Sorry, haven't had time for online poker for a little while. Signed into PS tonight to start getting back into the tournaments (have also not kept up with the news apparantly) and see that I am not allowed to play. At least I was allowed to cash out.

I certainly wasn't making a living at it in any stretch of the imagination but it was a fun hobby and a way to pick up a few bucks.

With all the other crap we need to get straightened out this certainly shouldn't have been tops on the list. Get jobs back in the country and stop making outsourcing easy you overpaid pieces of shit...

[HeavyReign]

Pokerstars is still the only site that has paid out balances to US residents.