Well, tax day generally isn’t a happy day, but online poker players were especially unhappy:
Last week, while many people reported their income to the Internal Revenue Service, others suddenly found their source of income shut off. On a day now known among online poker players as “Black Friday,” the Department of Justice did us Americans the favor of saving us from ourselves by shutting down the three most popular and trusted online poker platforms.
Not only did the department seize the three domain names, it also froze 77 accounts around the world and charged the founders of PokerStars, Full Tilt Poker and Absolute Poker, among others. What’s there crime? While the charges very carefully center on bank fraud, the heart of the department’s clampdown on Internet gambling stems from the Unlawful Internet Gambling Enforcement Act (UIGEA). Passed during a midnight vote in 2006, the UIGEA doesn’t actually prohibit online gambling but rather bans credit-processing companies from processing payments from “unlawful” online gambling activities. However, the bill never clarifies what it means by “unlawful” activities.
After the law’s passage, several online poker companies continued to operate in the United States, and Justice has turned the prosecution of those entities into a very lucrative endeavor. United Kingdom-based SportingBet, an online betting platform, signed a non-prosecution agreement with the U.S. government last year in return for a payment of $33 million, and in 2008, the co-founder of PartyGaming.com paid authorities $300 million in a settlement. In last week’s indictment, Justice announced that it was seeking a total of $3 billion from the poker companies. Compare this with the $105 million fine that Wachovia, which was found to be laundering billions of dollars in drug money, paid to the U.S. government, and one must wonder what kind of metric Justice uses when deciding which injustices to pursue.
