{{short description|U.S. federal criminal case against the founders of 3 online poker companies}} {{update|date=August 2013}} {{Use American English|date=February 2026}} {{Use mdy dates|date=February 2013}} {{Infobox United States District Court case | name = United States v. Scheinberg | court = [[United States District Court for the Southern District of New York]] | image = USDCSDNY.svg | imagesize = 150 | full name = United States v. [[Isai Scheinberg]], et al. | date decided = April 15, 2011 (indictment unsealed) | docket = 1:10-cr-00336 | citations = | transcripts = | judge = | subsequent actions = [[#Convictions|see below]] | related actions = ''United States v. PokerStars, et al.'', 11 Civ. 2564 (2011) | holding = }} '''''United States v. Scheinberg''''', No. 1:10-cr-00336 (2011), is a United States federal criminal case against the founders of the three largest [[online poker]] companies, [[PokerStars]], [[Full Tilt Poker]] and [[Cereus Poker Network|Cereus]] (Absolute Poker/Ultimatebet), and a handful of their associates,<ref name="OPCRAWUoPAtM">{{cite news|last1=McLaughlin|first1=David|last2=Jinks|first2=Beth|date=2011-04-20|title=Online Poker Companies Reach Accord With U.S. on Players' Access to Money|publisher=[[Bloomberg News]]|url=https://www.bloomberg.com/news/2011-04-20/online-poker-companies-reach-accord-with-u-s-on-players-access-to-money.html|access-date=2011-04-21}}</ref> which alleges that the defendants violated the [[Unlawful Internet Gambling Enforcement Act]] (UIGEA) and engaged in [[bank fraud]] and [[money laundering]] to process transfers to and from their customers.<ref name=OPCRAWUoPAtM/> A companion civil case, '''''United States v. Pokerstars, et al.''''', 11 Civ. 2564 (2011),<ref>{{cite web|url=https://www.scribd.com/doc/53170382/3bb-Civil-Complaint-DOJ-vs-PokerStars-Full-Tilt-UB-AP-et-al|title=Civil complaint|publisher=Scribd.com|date=2011-06-01|access-date=2014-01-19}}</ref> included Full Tilt and Cereus (Absolute Poker), Ultimate Bet, Oldford Group, Rational Entertainment Enterprises, and many others as defendants and sought the recovery of forfeiture equalling approximately $3 billion in assets belonging to the companies.<ref name=SDNY/> After the indictment was unsealed on April 15, 2011, a date quickly dubbed '''Black Friday''' by the online poker community,<ref name=ABFAPFCF>{{cite news|url=http://fivethirtyeight.blogs.nytimes.com/2011/04/20/after-black-friday-american-poker-faces-cloudy-future|title=After 'Black Friday,' American Poker Faces Cloudy Future|access-date=2011-04-21|date=2011-04-20|work=[[The New York Times]] (blog)|last=Silver|first=Nate}}</ref><ref name=UCDoOG/> PokerStars and Full Tilt stopped offering real money play to their United States customers.<ref name=Aipilf/>

Three years after the start of the [[poker boom]] in 2003, the [[United States Congress|U.S. Congress]] passed UIGEA to extend existing gambling laws into cyberspace. The law made processing payments for illegal online gambling a crime; however, the defendant companies remained in the U.S. market in the belief that the law did not cover [[poker]]. A former payment processor for the companies turned state's evidence after initially being charged with violating UIGEA himself. On September 20, the civil suit was amended claiming individual fraud by [[Howard Lederer]], [[Chris Ferguson]], and [[Rafe Furst|Rafael Furst]].<ref name=USAPSSD>{{cite news|url=https://www.wsj.com/articles/SB10001424053111904106704576582741398633386|title=U.S. Alleges Poker Site Stacked Deck|access-date=2011-09-22|date=2011-09-21|work=[[The Wall Street Journal]]|last=Berzon|first=Alexandra}}</ref><ref name=PWSCUUSS>{{cite news|url=https://www.nytimes.com/2011/09/21/business/poker-site-misused-players-money-us-says.html|title=Poker Web Site Cheated Users, U.S. Suit Says|access-date=2011-09-22|date=2011-09-21|work=[[The New York Times]]|last=Richtel|first=Matt}}</ref>

On April 15, 2011, the [[United States Department of Justice|U.S. Department of Justice]] seized the [[.com]] internet addresses of the three [[online gambling]] sites, replacing them with a [[takedown notice]]. On April 20, 2011, the U.S. Attorney's office returned the Pokerstars.com domain to the company, facilitating the withdrawal of U.S. players' funds. About 76 bank accounts in 14 countries were frozen, including an unknown amount of player funds.<ref>{{cite web|url=https://www.nytimes.com/2011/04/16/technology/16poker.html?_r=0|title=U.S. Cracks Down on Online Gambling|work=The New York Times|date=15 April 2011|access-date=28 April 2014|last=Richtel|first=Matt}}</ref> Prosecutors demanded prison for 11 defendants, including website founders, U.S. payment processors, and a Utah bank executive, for a complex fraud scheme circumventing UIGEA banking laws. In response, Antigua and Barbuda weighed WTO action. The implicated firms stopped U.S. ads, leading to the cancellation of poker TV shows. Full Tilt's eGambling license was suspended in June, stopping all online activities, and permanently revoked by the Alderney Gambling Control Commission on September 29.

On July 31, 2012, the US government dismissed "with prejudice" all civil complaints against all PokerStars and Full Tilt Poker companies after coming to a settlement with PokerStars which includes PokerStars purchasing Full Tilt.<ref name="ESPN">{{cite web|url=https://www.espn.com/poker/story/_/id/8218085/pokerstars-reaches-settlement-department-justice-acquires-full-tilt-poker|title=ESPN: PokerStars settles, acquires FTP|publisher=Espn.go.com|date=2012-07-31|access-date=2014-01-19}}</ref> PokerStars and Full Tilt admitted no wrongdoing as part of the settlement, which ends all litigation between the government and the poker companies.<ref>{{cite web|url=http://www.onlinecasinobluebook.com/poker-rooms/legal-status-of-online-poker-in-the-united-states|title=Legal Status of Online Poker in the United States|publisher=OCBB|access-date=28 April 2014|last=Vaughn|first=Jake}}</ref> The U.S. Government recognized that both companies are eligible to apply for licenses to conduct online gaming in the U.S., contingent upon the provision of a legal structure for such licensing. The criminal indictments resulted in prison time for all three defendants.

This case had significant implications for the online poker industry and prompted discussions about the regulation of online gambling in the United States.

==Background== ===Growth of poker=== {{main|Poker boom}} In 2003, [[ESPN]] expanded its coverage of the [[World Series of Poker]]. Between [[2003 World Series of Poker|2003]] and [[2006 World Series of Poker|2006]], the number of contestants in the $10,000 [[Betting (poker)#No limit|No Limit]] [[Texas hold'em]] Main Event grew from 839 to 8773.<ref name=ABFAPFCF/> After the UIGEA was passed, the World Series of Poker main event decreased in size, to 6358 players in 2007. In 2015, 6420 players participated.<ref>{{Cite web|title=WSOP {{!}} Tournament Schedule|url=https://www.wsop.com/tournaments/schedule/?groupid=1136|access-date=2023-06-29|website=www.wsop.com}}</ref>

===Changes in gambling laws=== On October 13, 2006, the [[United States Congress]] passed [[Unlawful Internet Gambling Enforcement Act of 2006]] ('''UIGEA'''), which makes it a federal offense, punishable by up to five years in prison, for a gambling business to "knowingly accept" payments "in connection with the participation of another person in unlawful Internet gambling."<ref name=ABFAPFCF/><ref name=Sullum>{{cite web|url=http://www.krla870.com/column.aspx?id=ae495331-0f17-4b6b-8629-321181df90f3|title=Poker Bars: Why Should Anyone Go to Prison for Helping People Play Cards?|first=Jacob|last=Sullum|author-link=Jacob Sullum|publisher=KLRA|archive-url=https://web.archive.org/web/20110723210023/http://www.krla870.com/column.aspx?id=ae495331-0f17-4b6b-8629-321181df90f3|archive-date=2011-07-23|date=2011-04-20}}</ref> However, according to syndicated columnist [[Jacob Sullum]], the [[Void for vagueness|law did not define]] or alter the definition of unlawful gambling, which under Federal law only applies to [[sports betting]] via the [[Wire Act]].<ref name=Sullum/>

Nevertheless, [[Party Poker]], at the time the largest provider for U.S. demand, decided to withdraw from servicing the United States poker market. The [[United States Department of Justice]] later indicted them for services provided prior to 2006 in violation of the [[Wire Act]], a case they [[settled out of court]] in the hopes of being allowed to serve the U.S. market at a later date.<ref name=PSWUDoJf$M/> Also in 2006, several other online poker service providers withdrew from the market, including [[Sportingbet]]'s Paradise Poker, [[888 Holdings]]' Pacific Poker, and the iPoker Network's CD Poker.<ref name=iSWTfOPS>{{cite web|url=http://www.pokernewsdaily.com/imega-signs-were-there-for-online-poker-seizures-18918/|title=iMEGA: Signs Were There for Online Poker Seizures|access-date=2014-03-02|date=2011-04-25|website=pokernewsdaily.com|last=Cypra|first=Dan}}</ref>

Several other sites continued to facilitate the demand for online poker in the U.S., which had been growing about 20% per year.<ref name=ABFAPFCF/><ref name=Aipilf/><ref name=IBOPBF/>

A 2006 law passed in [[Washington (state)|Washington state]] that made it a felony to play online poker was upheld as constitutional by the [[Washington Supreme Court]] in September 2010.<ref>{{cite news|url=http://www.seattlepi.com/local/427242_poker23.html|title=High Court upholds state ban on Internet poker, online gambling|publisher=Seattle P-I|first=LEVI|last=PULKKINEN|date=2010-09-23}}</ref> PokerStars immediately withdrew from Washington's market, and Full Tilt soon followed suit, but both sites continued to provide services to players in the other 49 U.S. states.

This case was preceded by a 2009 seizure of $34 million worth of winnings in transit U.S. poker players (q.v. [[Southern District of New York action against online poker players]]).

===Basis for the case=== Since Federal law [[Vagueness doctrine|says nothing specifically]] about online poker, or any gambling other than sports betting,<ref name=Sullum/><ref name=Mahoney>{{cite web|url=http://www.relentlessdefense.com/our-team/kevin-j-mahoney/commentary-on-high-profile-cases/u-s-attorney-s-office-on-tilt|title=U.S. Attorney's Office on Tilt|first=Kevin J.|last=Mahoney|publisher=Mahoney Criminal Defense Group|date=2011-04-21}}</ref> [[Preet Bharara]], the [[United States Attorney for the Southern District of New York|U.S. Attorney for the Southern District of New York]], bases his case on a [[Law of New York (state)|New York law]] that makes it a Class A [[misdemeanor]], punishable by up to a year in prison, to run a game of chance where bets are placed within the state.<ref name=Sullum/> Although none of the sites are [[Jurisdiction|actually run out of]] New York (PokerStars is based on the [[Isle of Man]], Full Tilt Poker is in [[Republic of Ireland|Ireland]] and Absolute Poker is from [[Costa Rica]]),<ref name=OPCRAWUoPAtM/> he was able to obtain a [[felony]] indictment for UIGEA violations.<ref name=Johnson/> In addition to the 2006 UIGEA, the defendants were charged with violating the [[Illegal Gambling Business Act]] (18 USC 1955).<ref name=OPBTI>{{cite web|url=http://www.pokernews.com/news/2011/04/online-poker-big-three-indicted-10218.htm|title=Online Poker's Big Three Indicted (UPDATED 4/18 4:45&nbsp;pm PDT)|access-date=2011-04-23|date=2011-04-18|work=[[Poker News]]|last1=Chaivarlis|first1=Elaine|last2=Matthew|first2=Kredell}}</ref><ref>{{cite web|url=https://www.law.cornell.edu/uscode/text/18/1955|title=18 USC § 1955 - Prohibition of illegal gambling businesses|publisher=Law.cornell.edu|access-date=2014-01-19}}</ref>

Additionally, in April 2010, the former head of Intabill, a defunct payment processor in [[Australia]], Daniel Tzvetkoff,<ref name=SMH>{{cite news|url=http://www.smh.com.au/technology/technology-news/witness-protection-likely-for-tzvetkoff-20110422-1dr8i.html|title=Witness protection likely for Tzvetkoff|publisher=Sydney Morning Herald|date=2011-04-22}}</ref> was arrested in [[Las Vegas Valley|Las Vegas]] by the [[Federal Bureau of Investigation|FBI]].<ref name=Sullum2>{{cite web|url=http://reason.com/archives/2010/04/21/getting-away-with-poker|title=Getting Away With Poker: How is helping people play a card game like murder?|first=Jacob|last=Sullum|publisher=Reason|date=2010-04-21}}</ref> He was charged with money laundering, bank fraud, and wire fraud.<ref>{{cite web|url=http://www.businessinsider.com/boy-genius-online-poker-scandal-2011-4|title=Meet The Boy Genius Who Just Took Down The Online Poker Industry|access-date=2011-04-24|date=2011-04-15|work=[[Business Insider]]|author=Bennett, Meet The Boy Genius Who Just Took Down The Online Poker Industry Dashiell}}</ref> PokerStars and Full Tilt had previously claimed that Tzvetkoff cheated them out of at least $100 million.<ref>{{cite web|url=http://www.couriermail.com.au/ipad/web-kings-life-on-the-line/story-fn6ck45n-1226039907165|title=Web king behind FBI raids|first=Paul|last=Toohey|author2=NewsCore|publisher=The Courier-Mail|date=2011-04-16}}</ref> However, he was quietly let go a few months later in August 2010.<ref>{{cite news|url=http://www.theaustralian.com.au/news/nation/arrests-follow-internet-high-flyers-release/story-e6frg6nf-1226039942478|title=Arrests follow internet high-flyer's release|publisher=[[The Australian]]|first=Michael|last=McKenna|date=2011-04-16}}</ref> He reportedly [[Turn state's evidence|turned state's evidence]] after being threatened with a 75-year prison sentence for alleged UIGEA violations.<ref name=SMH/><ref name=Sullum2/>

The indictment also alleged that the executive officers of the sites had sought investment in SunFirst Bank in [[Utah]], which they were using to obtain and pay out player funds by allegedly mis-coding transactions.<ref name=Johnson/> Although [[Victimless crime|no one was actually being defrauded]] ''per se'', and money from an otherwise legal operation cannot be "laundered",<ref name=Mahoney/> these actions formed the basis for the fraud and money laundering charges.<ref name=Johnson>{{cite web|url=http://pokercast.twoplustwo.com/pokercast.php?pokercast=168|title=PokerCast Episode 168 – Black Friday Special; Aftermath of the Online Poker Indictments|first=Mike|last=Johnson|author2=Adam Schwartz|publisher=[[Two Plus Two Publishing|Two Plus Two]]|date=2011-04-18|access-date=April 22, 2011|archive-date=August 24, 2011|archive-url=https://web.archive.org/web/20110824215410/http://pokercast.twoplustwo.com/pokercast.php?pokercast=168|url-status=dead}}</ref> This case marks only the second time that the Department of Justice has alleged violations of the UIGEA,<ref>{{cite web|url=http://www.krla870.com/column.aspx?id=ae495331-0f17-4b6b-8629-321181df90f3|title=Poker Bars: Why Should Anyone Go to Prison for Helping People Play Cards?|access-date=2011-04-24|date=2011-04-20|work=[[KRLA]]|last=Sullum|first=Jacob}}</ref> after the indictment of Daniel Tzvetkoff.

A [[grand jury]] handed down a sealed indictment on March 10, 2011.

==Domain name seizure== {{multiple image | align = right | direction = vertical | width=300 | footer = [[Online poker]] was suspended on April 15 at the top three United States websites (In order, [[PokerStars]], [[Full Tilt Poker]] and [[Cereus Poker Network]]) and continues to be suspended at the top two. | footer_align = left | footer_background = | image1 = Full Tilt Poker Seizure Notice.png | width1 = | caption1 = [[United States Department of Justice]] website seizure notice}} On April 15, 2011, the United States Attorney in New York seized and shut down defendants' domains which included Pokerstars.com, Fulltiltpoker.com, Absolutepoker.com, Ultimatebet.com and UB.com.<ref name=UCDoOG>{{cite news|url=https://www.nytimes.com/2011/04/16/technology/16poker.html|title=U.S. Cracks Down on Online Gambling|access-date=2011-04-17|date=2011-04-15|work=[[The New York Times]]|last=Richtel|first=Matt}}</ref><ref name=Aipilf/><ref name=OPCRAWUoPAtM/>

On April 20, 2011, the office of the U.S. Attorney reinstated the control of the domain name Pokerstars.com back to the company. This action was taken to enable the withdrawal of funds held in accounts by U.S. players with the companies.<ref>{{Cite web|title=UNITED STATES ENTERS DOMAIN-NAME USE AGREEMENTS WITH TWO ONLINE POKER COMPANIES|url=https://www.justice.gov/archive/usao/nys/pressreleases/April11/pokerdomainnameuseagreementspr.pdf}}</ref>

In July 2012, the government reached settlements with PokerStars and Full Tilt and dismissed civil complaints "with prejudice" against the two companies. Both companies admitted no wrongdoing.<ref name="ESPN" /> The U.S. Government recognized that both companies are eligible to apply for licenses to conduct online gaming in the U.S., contingent upon the provision of a legal structure for such licensing.<ref>{{Cite news|last=Rubenfeld|first=Samuel|title=PokerStars, Full Tilt Poker Settle with Justice Department|url=https://www.wsj.com/articles/BL-CCB-6825|access-date=2024-03-04|work=WSJ|language=en-US}}</ref>

==Accounts seized== About 76 bank accounts in 14 countries were then frozen, preventing players from accessing balances held by the companies, according to the FBI's New York office.<ref>{{cite news|url=https://www.bloomberg.com/news/2011-04-18/online-poker-player-accounts-frozen-amid-fbi-gambling-probe.html|title=Online Poker Player Accounts Frozen as U.S. Indicts Operators|access-date=2011-04-21|date=2011-04-18|publisher=[[Bloomberg News]]|last1=Hurtado|first1=Patricia|last2=Jinks|first2=Beth}}</ref> That Full Tilt and Pokerstars accepted a total of $500 million in total player deposits is a conservative estimate.<ref name=ABFAPFCF/>

==Persons indicted== The indictment named eleven individuals who were each charged with four crimes, including Raymond Bitar, CEO of TiltWare - software company for Full Tilt Poker, Isai Scheinberg, founder of PokerStars, Scott Tom, part owner of Absolute Poker, John Campos, Vice chairman of the board and part-owner of SunFirst Bank and others.<ref name=OPBTI/>

The prosecutors were seeking jail sentences for the indicted executives and $3 billion from the poker companies.<ref>{{cite news|url=http://latimesblogs.latimes.com/money_co/2011/04/three-largest-online-poker-sites-indicted-and-shut-down-by-fbi.html|title=Three largest online poker sites indicted and shut down by FBI|access-date=2011-04-22|date=2011-04-15|work=[[Los Angeles Times]]}}</ref> When the U.S. Department of Justice pursued Party Poker in 2006, it led to a $300 million plea agreement by PartyGaming co-founder [[Anurag Dikshit]] and a $105 million settlement with the company itself in 2009.<ref name=PSWUDoJf$M>{{cite web|url=http://news.bluffmagazine.com/partygaming-settles-with-us-dept-of-justice-for-105-million-3012|title=PartyGaming Settles With U.S. Dept. of Justice for $105 Million|access-date=2011-04-22|date=2009-04-07|work=[[Bluff Magazine]]|last=Newell|first=Jennifer}}</ref> In the criminal case, "The maximum penalty for violation of the UIGEA and operating a gambling business is 5 years in prison and a fine of $250,000 or twice the gross gain or loss for each charge, for conspiracy to commit wire fraud is 30 years in prison and a fine of $1 million or twice the gross gain or loss, and for money laundering conspiracy is 20 years in prison and a fine of $500,000 or twice the amount laundered."<ref name=OPBTI/>

==Government position== [[Preet Bharara]], the [[United States Attorney for the Southern District of New York]], expressed his view when the indictment was unsealed:<ref name=SDNY>{{cite web|first=Preet|last=Bharara|publisher=United States Attorney Southern District of New York|title=Manhattan U.S. Attorney Charges Principals of Three Largest Internet Poker Companies With Bank Fraud, Illegal Gambling Offenses and Laundering Billions in Illegal Gambling Proceeds|url=https://www.justice.gov/usao/nys/pressreleases/April11/scheinbergetalindictmentpr.pdf|date=2011-04-22|url-status=dead|archive-url=https://web.archive.org/web/20110419230512/http://www.justice.gov/usao/nys/pressreleases/April11/scheinbergetalindictmentpr.pdf|archive-date=April 19, 2011}}</ref>

<blockquote>As charged, these defendants concocted an elaborate criminal fraud scheme, alternately tricking some U.S. banks and effectively bribing others to assure the continued flow of billions in illegal gambling profits. Moreover, as we allege, in their zeal to circumvent the gambling laws, the defendants also engaged in massive money laundering and bank fraud. 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.</blockquote>

FBI Assistant Director-in-Charge Janice K. Fedarcyk added:

<blockquote>These defendants, knowing full well that their business with U.S. customers and U.S. banks was illegal, tried to stack the deck. They lied to banks about the true nature of their business. Then, some of the defendants found banks willing to flout the law for a fee. The defendants bet the house that they could continue their scheme, and they lost.<ref name=SDNY/></blockquote>

In the amended complaint the government alleged that "Full Tilt Poker did not maintain funds sufficient to repay all players, and in addition, the company used player funds to pay board members and other owners more than $440 million since April 2007."<ref name=USAPSSD/><ref name=PWSCUUSS/><ref name=UAMTACC>{{cite web|url=https://www.justice.gov/usao/nys/pressreleases/September11/amendedfulltiltpokercomplaintpr.pdf|title=Manhattan U.S. Attorney Moves To Amend Civil Complaint Alleging That Full Tilt Poker and Its Board of Directors Operated Company As A Massive Ponzi Scheme Against Its Own Players|access-date=2011-09-22|date=2011-09-20|publisher=[[United States Department of Justice]]|archive-url=https://web.archive.org/web/20111018033321/http://www.justice.gov/usao/nys/pressreleases/September11/amendedfulltiltpokercomplaintpr.pdf|archive-date=October 18, 2011|url-status=dead|df=mdy-all}}</ref><ref>{{citation|url=https://online.wsj.com/public/resources/documents/FullTiltAmendSuit_Sept20_2011.pdf|title=VERIFIED FIRST AMENDED COMPLAINT 11 Civ. 2564|author=United States of America|publisher=UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK|date=September 20, 2011|access-date=2011-09-26}}</ref> Furthermore, the amended complaint uses the term [[ponzi scheme]] prominently, including in its title.<ref name=UAMTACC/>

A lawyer for Ferguson has denied the allegations, suggesting that the issues may have been the result of mismanagement not malice.<ref>{{cite web|url=http://slatest.slate.com/posts/2011/09/20/full_tilt_poker_ponzi_scheme_jesus_ferguson_howard_lederer_among.html|title=Full Tilt Poker Denies it's a Ponzi Scheme|author=Greg Howard|publisher=The Slatest|date=September 22, 2011|access-date=2011-09-26|archive-url=https://web.archive.org/web/20110923191141/http://slatest.slate.com/posts/2011/09/20/full_tilt_poker_ponzi_scheme_jesus_ferguson_howard_lederer_among.html|archive-date=September 23, 2011|url-status=dead|df=mdy-all}}</ref><ref>{{cite news|last=Berzon|first=Alexandra|title=Poker Site Fires Back at U.S.|work=The [[Wall Street Journal]]|date=September 22, 2011|url=https://www.wsj.com/articles/SB10001424053111903791504576585390448785426#ixzz1Yh0uUWHg|access-date=September 26, 2011}}</ref> A lawyer for some of the defendants issued a press release stating that the phrase ponzi scheme was inaccurate, unfair and disingenuous and that its use was counterproductive.<ref>{{cite news|url=http://bits.blogs.nytimes.com/2011/09/21/poker-site-fires-back-over-ponzi-scheme-charge/|title=Poker Site Fires Back Over 'Ponzi Scheme' Charge|access-date=2011-10-05|date=2011-09-21|work=[[The New York Times]]|last=Richtel|first=Matt}}</ref>

The parties reached a settlement on July 31, 2012, ending all litigation between the government and the PokerStars/Full Tilt companies.<ref>{{cite news|last=Berzon|first=Alexandra|url=https://www.wsj.com/articles/SB10000872396390444405804577561081504242636|title=PokerStars and Full Tilt Poker Reach Settlement With Justice Department - WSJ.com|publisher=Online.wsj.com|date=2012-08-02|access-date=2014-01-19}}</ref><ref>{{cite web|url=http://diamondflushpoker.com/2012/07/full-tilt-poker-issues-media-release-following-civil-settlement|title=Full Tilt Poker Issues Media Release Following Civil Settlement|publisher=Diamond Flush Poker|date=2012-07-31|access-date=2014-01-19}}</ref><ref>{{cite web|url=https://www.fbi.gov/newyork/press-releases/2012/manhattan-u.s.-attorney-announces-731-million-settlement-of-money-laundering-and-forfeiture-complaint-with-pokerstars-and-full-tilt-poker|title=FBI — Manhattan U.S. Attorney Announces $731 Million Settlement of Money Laundering and Forfeiture Complaint with PokerStars and Full Tilt Poker|publisher=Fbi.gov|access-date=2014-01-19}}</ref>

==Player response== {{wikisource|Sample Senator response to Poker's Black Friday}} "Along with everyone else in the poker world, I'm shocked," said [[Brandon Adams (poker player)|Brandon Adams]], a poker professional who has appeared in televised tournaments on [[NBC]] and ESPN. "The expectation was that there would be warning signs. These sites went from multibillion-dollar enterprises to on the ropes overnight." He added: "Some players have literally millions of dollars in their online poker accounts."<ref name=Karp/>

The [[Poker Players Alliance]] called upon poker players affected by the shutdown to contact their congressional representatives.

Poker player and then-current [[United States House of Representatives|U.S. Congressman]] [[Barney Frank]], in an interview with ''[[The Hill (newspaper)|The Hill]]'', lamented that the Justice Department is more focused on prosecuting online poker sites than those responsible for the [[subprime mortgage crisis]] and the [[2008 financial crisis]].<ref name=Nagesh>{{cite news | url=https://thehill.com/policy/technology/89006-rep-frank-administration-wasting-time-with-online-poker-crackdown/ |archive-url=https://web.archive.org/web/20110426053229/http://thehill.com/blogs/hillicon-valley/technology/156655-rep-barney-frank-blasts-obama-admin-for-online-poker-crackdownc |archive-date=April 26, 2011 |title=Rep. Frank: Administration 'wasting time' with online poker crackdown |first=Gautham|last=Nagesh | work=[[The Hill (newspaper)|The Hill]] |date=2010-04-18 | url-status=live}}</ref>

In an editorial in the ''[[Washington Post]]'', poker player and a former three-term [[United States Senate|U.S. Senator]] from New York [[Alfonse D'Amato]], a long-time favorite of industry lobbyists{{Citation needed|date=March 2017}}, wrote: "This is an attack on Internet poker and American poker players like me. Through these strong-arm tactics, prosecutors think they can ban Internet poker. Instead, they are making millions of Americans victims in an attempt to make online poker illegal without the support of legislators or the public." He called on [[President of the United States|President]] [[Barack Obama]] to rein in the [[United States Attorney for the Southern District of New York|prosecuting attorneys in the Southern District of New York]].<ref>{{cite news|url=https://www.washingtonpost.com/opinions/former-senator-alfonse-damato-make-online-poker-legal-it-already-is/2011/04/20/AFAWPwOE_story.html|title=Make online poker legal? It already is|first=Alphonse|last=D'Amato|author2=Al D'Amato|newspaper=Washington Post|date=2011-04-22}}</ref>

==International response== [[Antigua and Barbuda]] said US violated global trade laws and considered filing action in WTO.<ref name=AsUopswi>{{cite news|url=https://www.reuters.com/article/us-usa-antigua-poker-idUSTRE73K6Z020110421|title=Antigua says U.S. online poker shutdown was illegal|publisher=Reuters|first=Jane|last=Sutton|date=2011-04-21}}</ref> They had successfully won a similar case against US with WTO in response to US prosecution of owners of offshore gambling sites.<ref>{{cite web|url=http://www.pokernewsdaily.com/u-s-could-face-world-trade-organization-action-for-online-poker-shutdown-18895/|title=U.S. Could Face World Trade Organization Action for Online Poker Shutdown|access-date=2011-04-24|date=2011-04-23|website=pokernewsdaily.com|last=Collson|first=Brett}}</ref> At the time, online poker was the second largest industry in Antigua's economy.<ref name=AsUopswi/> The Alderney Gambling Control Commission (AGCC) also took action against the operators, essentially shutting down operations.<ref>{{cite web|url=http://www.pokernews.com/news/2011/06/breaking-news-full-tilt-poker-license-suspended-by-agcc-10629.htm|title=Breaking News: Full Tilt Poker License Suspended by AGCC (Updated 9:20 a.m. PDT)|access-date=2011-06-30|date=2011-06-29|publisher=[[Poker News]]|last=Holloway|first=Chad}}</ref>

Various sources report that this opened the way for [[Jack Binion]] to buy Full Tilt and ensure all Full Tilt Poker players get refunded in the process.<ref>{{cite web|url=http://pokernewsboy.com/online-poker-news/is-jack-binion-in-talks-with-full-tilt-poker/7952|title=Is Jack Binion in talks with Full Tilt Poker?|access-date=2011-06-30|date=2011-06-29|last=Ruddock|first=Steve|publisher=PokerNewsBoy.com}}</ref><ref>{{cite web|url=http://www.egrmagazine.com/news/1673502/news-in-brief-euroregulators-sign-moubinion-linked-to-tilt-stake-pokernewsdaily-sale.thtml|title=Binion linked to Tilt stake|access-date=2011-06-30|date=2011-06-28|work=eGaming Review Magazine|archive-date=July 1, 2011|archive-url=https://web.archive.org/web/20110701072513/http://www.egrmagazine.com/news/1673502/news-in-brief-euroregulators-sign-moubinion-linked-to-tilt-stake-pokernewsdaily-sale.thtml|url-status=dead}}</ref><ref>{{cite news|url=https://www.wsj.com/articles/SB10001424052702303763404576416202706602490|title=Regulator Closes Full Tilt Poker Website|access-date=2011-07-01|date=2011-06-30|work=[[The Wall Street Journal]]|last=Berzon|first=Alexandra}}</ref> On June 30, European investors agreed to provide capital to repay Full Tilt Players in exchange for a majority stake in the company.<ref name=FTPtbstEi>{{cite news|url=http://www.latimes.com/business/la-fi-online-poker-20110701,0,6054543.story|title=Full Tilt Poker to be sold to European investors: Deal could allow U.S. players to recover as much as $150 million from the online poker company, which was shut down by U.S. prosecutors in April|access-date=2011-07-01|date=2011-06-30|work=[[Los Angeles Times]]|last=Popper|first=Nathaniel}}</ref><ref>{{cite news|url=https://www.wsj.com/articles/SB10001424052702304584004576419531429712862|title=Full Tilt Owner Finds Buyer|access-date=2011-07-01|date=2011-07-01|work=[[The Wall Street Journal]]|last=Berzon|first=Alexandra}}</ref> On July 26, the hearing revealed that Full Tilt owed {{GBP|250000}} ({{USD|410000}}) in overdue licensing fees to the AGCC, which Full Tilt paid within seven days as promised clearing the way for approval of a refinancing deal. The hearing was suspended until no later than September 15 as a result of the revelation.<ref>{{cite magazine|url=http://www.egrmagazine.com/news/1685552/full-tilt-pays-overdue-alderney-licence-fees.thtml|title=Full Tilt pays overdue Alderney licence fees|access-date=2011-08-10|date=2011-08-08|magazine=E Gaming Review|last=Victor|first=Tom|archive-date=August 24, 2011|archive-url=https://web.archive.org/web/20110824224304/http://www.egrmagazine.com/news/1685552/full-tilt-pays-overdue-alderney-licence-fees.thtml|url-status=dead}}</ref><ref>{{cite web|url=http://www.gamblingcontrol.org/FTP_statement.pdf|title=Full Tilt Poker|access-date=2011-08-10|date=14 September 2011|publisher=Aldernyey Gambling Control Commission|archive-date=October 1, 2011|archive-url=https://web.archive.org/web/20111001052118/http://www.gamblingcontrol.org/FTP_statement.pdf|url-status=dead}}</ref> The delay until September 15 offers Full Tilt a chance to complete its negotiated settlement.<ref>{{cite web|url=http://www.internet-poker.co.uk/Poker-News/Poker-Sites/Full-Tilt-Poker-Pays-Overdue-Licensing-Fees-to-AGCC~4311.html|title=Full Tilt Poker Pays Overdue Licensing Fees to AGCC|access-date=2011-08-10|date=2011-08-07|publisher=Internet Poker|last=Arnold|first=Susan|archive-date=October 4, 2011|archive-url=https://web.archive.org/web/20111004210915/http://www.internet-poker.co.uk/Poker-News/Poker-Sites/Full-Tilt-Poker-Pays-Overdue-Licensing-Fees-to-AGCC~4311.html|url-status=dead}}</ref> On September 29, the AGCC stripped Full Tilt of its license. The AGCC's statement said that Full Tilt had misrepresented its financial situation, while Full Tilt said the action would jeopardize its ability to repay its customers.<ref>{{cite news|url=https://www.nytimes.com/2011/09/30/business/full-tilt-poker-says-license-revocation-threatens-repayments.html|title=Full Tilt Poker Site Loses License|access-date=2011-10-05|date=2011-09-29|work=[[The New York Times]]}}</ref>

==Economic impact== Prior to the indictments, the United States accounted for 25 to 40% of the poker business for these companies.<ref name=Aipilf>{{cite web|url=https://www.espn.com/espn/poker/columns/story?columnist=wise_gary&id=6372121|title=After indictments, poker industry looks forward|access-date=2011-04-17|date=2011-04-17|publisher=[[ESPN]]}}</ref> For PokerStars, the International business share was 70 to 75% and for Full Tilt it was 50 to 60%, according to one source.<ref name=ABFAPFCF/> [[Darren Rovell]] cites a source that says the three companies had a 95% [[market share]] in online poker in the United States.<ref name=IBOPBF>{{cite web|url=https://www.cnbc.com/2011/04/18/insider-breakdown-of-pokers-black-friday.html|title=Insider Breakdown of Poker's Black Friday|access-date=2011-04-19|date=2011-04-18|last=Rovell|first=Darren|publisher=[[CNBC]]}}</ref>

The companies combined for an estimated [[US$]]200 million in advertising and marketing in the United States and their withdrawal from the U.S. market left [[network show]]s such as ''[[Poker After Dark]]'' and ''[[Big Game (poker)|The Big Game]]'' without advertising sponsors.<ref name=IBOPBF/> On cable television, ESPN's contract with PokerStars was for $22 million.<ref name=IBOPBF/> ESPN withdrew its Pokerstars advertising.<ref name=ABFAPFCF/> On April 17, [[ESPN2]] cancelled its scheduled broadcast of the [[North American Poker Tour season 2|2011 North American Poker Tour]] presented by PokerStars.net.<ref>{{cite news|url=https://www.usatoday.com/SPORTS/usaedition/2011-04-18-poker18_st_U.htm|title=Poker programming takes hit after FBI's crackdown on sites|access-date=2011-04-24|date=2011-04-17|work=[[USA Today]]}}</ref> On [[Game Show Network]], prepaid episodes of ''[[High Stakes Poker]]'' continued to air for several months after the event, but the show was in danger of not returning.<ref>{{cite news|url=https://www.wsj.com/articles/SB10001424053111904772304576466343325102336|title=Inside the TV Poker Machine|access-date=2011-07-27|date=2011-07-26|work=[[Wall Street Journal]]|last1=Schechner|first1=Sam|last2=Berzon|first2=Alexandra}}</ref>

The companies accounted for a large proportion of World Series of Poker qualifiers via online satellites.<ref name=IBOPBF/> As a result, the [[2011 World Series of Poker]] main event had the highest percentage of foreign players (and lowest percentage of American players) in history with 2,265 foreign players.<ref>{{cite web|url=http://www.wsop.com/pdfs/reports/11497%5COFFICIAL_REPORT_DAY_6_MAIN_EVENT.pdf|title=2011 World Series of Poker Presented by Jack Link's Beef Jerky Rio All-Suite Hotel and Casino Las Vegas, Nevada Official Report Event No. 58 End of Day Six|access-date=2011-07-22|date=2011-07-18|publisher=WSOP.com|archive-date=August 15, 2011|archive-url=https://web.archive.org/web/20110815183529/http://www.wsop.com/pdfs/reports/11497%5COFFICIAL_REPORT_DAY_6_MAIN_EVENT.pdf|url-status=dead}}</ref>

[[Wynn Resorts]] allied with PokerStars on March 25 to seek the legalization of Internet gambling in the U.S., but terminated the accord on April 15.<ref name=OPCRAWUoPAtM/>

U.S. citizens who play online poker for a living effectively lost their livelihoods due to the DOJ action.<ref name=Peters>{{cite web|url=http://www.pokernews.com/news/2011/04/pokernews-debate-hysteric-reactions-black-friday-warranted-10256.htm|title=PokerNews Debate: Are Hysteric Reactions to Black Friday Warranted|first=Donnie|last=Peters|author2=Rich Ryan|publisher=Pokernews|date=2011-04-22}}</ref><ref>{{cite news|url=https://www.google.com/hostednews/ap/article/ALeqM5guppkm5rQejC_TfXW_4dk-SW1RsA?docId=3aa2664dbbb04b2e8ba568cf2bd5f328|archive-url=https://web.archive.org/web/20110424111434/http://www.google.com/hostednews/ap/article/ALeqM5guppkm5rQejC_TfXW_4dk-SW1RsA?docId=3aa2664dbbb04b2e8ba568cf2bd5f328|url-status=dead|archive-date=April 24, 2011|title=Prosecutions turn online poker into a shaky bet|agency=[[Associated Press]]|date=2011-04-22}}</ref> [[Pokernews]] pointed out a thread on the [[Two Plus Two Publishing|Two Plus Two]] forums where the [[Poker Players Alliance|PPA]] asked players to share their stories.<ref name=Peters/><ref>{{cite web|url=http://forumserver.twoplustwo.com/57/poker-legislation/ppa-wants-know-how-impacts-you-post-your-story-thread-1022380|title=The PPA Wants to Know How This Impacts You – Post Your Story in This Thread!|first=John|last=Pappas|publisher=[[Two Plus Two Publishing|Two Plus Two]] (message board)|date=2011-04-17}}</ref> Among the poker networks seen as potential destinations for U.S. Poker players looking for a new online home are Carbon Poker and [[DoylesRoom]].<ref name=iSWTfOPS/>

According to [[Brandon Adams (poker player)|Brandon Adams]], live poker gambling at casinos might be a short-term beneficiary of the crackdown, but often online and live poker are not competitive but complementary, with players honing their skills in cheap, fast games online before gaining the nerve to play for higher stakes at a casino.<ref name=Karp>{{cite web|url=http://law.uark.edu/faculty/gallini/Gallini-4-18-11_--_Online_poker_industry_ponders_next_move_-_chicagotribune.com.pdf|title=Online poker industry ponders next move: Bust by Justice Department causes turmoil|first=Gregory|last=Karp|publisher=Chicago Tribune|date=2011-04-18}}</ref>

According to ''[[Time (magazine)|Time]]'', the opposition to legalized domestic online gambling is depriving the United States economy from a huge potential source of tax revenues.<ref>{{cite magazine|url=https://business.time.com/2011/04/19/keeping-us-safe-from-poker/|title=Keeping Us Safe from Poker|access-date=2011-04-23|date=2011-04-19|magazine=[[Time (magazine)|Time]]|last=Saporito|first=Bill}}</ref> One [[political action committee]] that received approximately $300,000 from PokerStars returned the money.<ref name=OPBTI/>

On April 26, PokerStars began processing cashouts.<ref>{{cite web|url=http://www.pokernewsdaily.com/pokerstars-processing-u-s-player-cashouts-18949/|title=PokerStars Processing U.S. Player Cashouts|access-date=2011-04-28|date=2011-04-26|publisher=Pokernewsdaily.com}}</ref> On May 4, Blanca Gaming of Antigua, the parent company to UB and Absolute Poker who had already laid off 95% of its employees, decided that it would have to pursue [[bankruptcy]].<ref>{{cite web|url=http://www.nbcnews.com/id/42906061|archive-url=https://web.archive.org/web/20201014042222/http://www.nbcnews.com/id/42906061|url-status=dead|archive-date=October 14, 2020|title=Indicted poker websites bound for bankruptcy: Collapse of Absolute Poker and UB sites means U.S. players may lose deposits|access-date=2011-05-05|date=2011-05-04|work=NBC News|last=Brunker|first=Mike}}</ref><ref>{{cite web|url=http://www.pokernews.com/news/2011/05/ub-absolute-poker-to-file-bankruptcy-10337.htm|title=UB & Absolute Poker to File Bankruptcy|access-date=2011-05-05|date=2011-05-04|work=[[Poker News]]|last=Holloway|first=Chad}}</ref> On May 6, Pokerstars augmented their cashout policies to allow players to cashout frequent player points and pro-rata portions of partially earned VIP rewards bonuses.<ref>{{cite web|url=http://www.pokerstars.com/usaplayers/faq/|title=United States Players: Frequently Asked Questions|access-date=2011-05-07|publisher=[[Pokerstars.com]]}}</ref>

On May 27, the Department of Justice unfroze an Irish account containing more than one-third of the more than $100 million that was owed to players. The account belonged to Full Tilt and its co-founder, Raymond Bitar. This was one of nine frozen Irish accounts.<ref>{{cite web|url=http://www.egrmagazine.com/news/1667072/exclusive-first-full-tilt-account-unfrozen.thtml|title=EXCLUSIVE: First Full Tilt account unfrozen|access-date=2011-06-09|date=2011-05-27|work=egaming|last1=Victor|first1=Tom|last2=Carter|first2=Stephen|archive-date=June 11, 2011|archive-url=https://web.archive.org/web/20110611160724/http://www.egrmagazine.com/news/1667072/exclusive-first-full-tilt-account-unfrozen.thtml|url-status=dead}}</ref> {{asof|2011|8|11}} [[Full Tilt Poker]] had failed to uphold its promise to return U.S. Poker players by May 15, following the April 15 events. As a result, Full Tilt Pro [[Phil Ivey]] announced he would not be playing the [[2011 World Series of Poker]] and suing Full Tilt.<ref>{{cite web|url=https://www.espn.com/espn/poker/news/story?id=6614429|title=Phil Ivey sits out World Series of Poker|access-date=2011-06-03|date=2011-06-01|publisher=[[ESPN]]}}</ref> Ivey voluntarily withdrew the suit on June 30.<ref name=FTPtbstEi/><ref>[https://www.clarkcountycourts.us/Anonymous/CaseDetail.aspx?CaseID=8941347 Clark County Courts: Register of Actions]</ref>

==Arrests== John Campos and Chad Elie were arrested on Black Friday. Campos is part-owner and vice chairman of the board of directors for SunFirst Bank. On Monday, April 18, Campos, of St. George, Utah, appeared in a Utah court, but did not enter a plea. He was released on $25,000 bond, ordered to surrender his passport and to appear in a New York court for his next appearance. Chad Elie, of Las Vegas, made his first court appearance in Manhattan on Tuesday April 19. He was released on $250,000 bail.<ref name="pnews1">{{cite web|url=http://www.pokernews.com/news/2011/04/chad-elie-and-john-campos-released-10243.htm|title=Chad Elie and John Campos Released|publisher=Pokernews.com|date=2011-04-19|access-date=2014-01-19}}</ref>

Bradley Franzen made a court appearance in Manhattan on Monday April 18, entering a plea of 'not guilty' to the nine counts listed on his indictment, including bank fraud and money laundering charges. Franzen's bail was set at $200,000, for which his parents' house was used as collateral.<ref name="pnews1"/> Franzen pleaded guilty in a New York court on May 23, 2011. It is not known when he will be sentenced; however, it appears that Franzen struck a plea agreement with prosecutors, in which he agreed to cooperate in the probe, in return for which prosecutors would recommend leniency.<ref>{{cite web|url=http://hosted.ap.org/dynamic/stories/U/US_POKER_PROSECUTION|title=Associated Press: Illinois Man Pleads Guilty in Online Poker Case|publisher=Hosted.ap.org|date=2002-05-29|access-date=2014-01-19}}</ref><ref>{{cite news|last=Bray|first=Chad|url=https://www.wsj.com/articles/SB10001424052702304066504576341493099478766|title=Wall Street Journal: Guilty Plea in Online Poker Case|publisher=Online.wsj.com|date=2011-05-23|access-date=2014-01-19}}</ref> Most of the other named defendants were out of the country.<ref name=OPBTI/> Ira Rubin, indicted on illegal gambling, fraud, and money laundering charges was arrested on Monday, April 25, 2011, in Guatemala. He made his initial court appearance in Miami on April 27, and was remanded in custody to his next appearance on April 29.<ref>{{cite web|url=http://www.pokernews.com/news/2011/04/defendant-in-online-poker-indictments-ira-rubin-arrested-10286.htm|title=Defendant in Online Poker Indictments Ira Rubin Arrested|publisher=Pokernews.com|date=2011-04-27|access-date=2014-01-19}}</ref>

Ray Bitar surrendered to authorities on July 2, 2012.<ref>{{cite news|url=https://www.forbes.com/sites/nathanvardi/2012/07/02/feds-arrest-full-tilt-ceo-ray-bitar|title=Feds Arrest Full Tilt CEO Ray Bitar And Again Call Full Tilt Poker A Ponzi Scheme|work=Forbes.com|access-date=2014-01-19|first=Nathan|last=Vardi}}</ref>

Isai Scheinberg surrendered to authorities upon landing in New York on January 17, 2020.<ref>{{Cite web|url=https://www.onlinepokerreport.com/39736/isai-scheinberg-pokerstars-arrested/|title=PokerStars Founder Isai Scheinberg To Face Federal Gambling Charges|date=2020-01-25|website=Online Poker Report|language=en-US|access-date=2020-02-01}}</ref> Scheinberg surrendered his passports, posted a $1 million bond, and was released with orders to remain in the New York area. He was the last of the 11 original defendants to face his charges in the US. In September 2020, Scheinberg was sentenced to pay a fine of $30,000 with no jail time.<ref>{{cite web|url=https://www.cardplayer.com/poker-news/25356-poker-site-operator-isai-scheinberg-gets-slap-on-the-wrist-for-charges-stemming-from-black-friday|title=Poker Site Operator Gets Slap On The Wrist For Charges Stemming From Black Friday|last=Schult|first=Steve|date=2020-09-24|access-date=2024-04-23}}</ref>

The judge presiding over the case acknowledged the wrongdoings but also recognized the positive actions taken by PokerStars under Scheinberg's leadership. Notably, PokerStars had stepped in to cover the debts of its rivals, Full Tilt and Ultimate Bet/Absolute Poker, ensuring that players received their frozen balances. The light sentence reflected these remedial actions and the broader context of Scheinberg's contributions to the online poker industry.<ref>{{Cite web|date=2020-03-25|title=Southern District of New York {{!}} PokerStars Founder Pleads Guilty {{!}} United States Department of Justice|url=https://www.justice.gov/usao-sdny/pr/pokerstars-founder-pleads-guilty|access-date=2024-03-04|website=www.justice.gov|language=en}}</ref><ref>{{Cite web|date=2020-09-23|title=Scheinberg Gets Minimal Sentence for PokerStars' Illegal US Operations|url=https://www.pokernews.com/news/2020/09/isai-scheinberg-minimal-sentence-38011.htm|access-date=2024-03-04|website=www.pokernews.com|language=en}}</ref>

==Convictions== On December 20, 2011, Absolute Poker co-founder Brent Buckley pleaded guilty to misleading banks. The [[plea deal]] calls for him to receive a sentence between a year and a year and a half in prison. Sentencing was set for April 19, 2012.<ref>{{cite news|url=http://articles.boston.com/2011-12-20/news/30538968_1_absolute-poker-full-tilt-poker-internet-poker|title=Poker company co-founder pleads guilty in NYC|first=Larry|last=Neumeister|publisher=Boston Globe|date=2011-12-20}}{{dead link|date=May 2026|bot=medic}}{{cbignore|bot=medic}}</ref> Buckley was sentenced to 14 months.<ref name="casinoscamreport.com">{{cite web|url=http://www.casinoscamreport.com/2012/07/29/real-money-online-poker-black-friday-eleven-casino-bonuses|title=Real Money Online Poker, Black Friday Eleven, & Casino Bonuses|first=Maggie|last=B.|publisher=Casino Scam Report|date=July 29, 2012}}</ref>

On January 17, 2012, Ira Rubin entered a plea agreement in a Manhattan federal court in front of US Magistrate Judge Gabriel Gorenstein. Rubin agreed to plead guilty to three of the nine counts of conspiracy to commit bank fraud he faced and was expected to be sentenced to 18–24 months of prison.<ref>{{cite news|url=https://blogs.wsj.com/corruption-currents/2012/01/17/man-pleads-guilty-in-us-internet-gambling-crackdown|title=Man Pleads Guilty in US Internet Gambling Crackdown|publisher=Wall Street Journal|date=2012-01-17}}</ref> He received a three-year sentence. Judge Kaplan said, "You are an unreformed con man and fraudster," and calling his actions a "brazen" defiance of US law. "A significant sentence is necessary to protect the community."<ref name="casinoscamreport.com"/>

John Campos pleaded guilty in March 2012 to a single misdemeanor bank gambling charge. He was sentenced in June to three months in prison. During his plea, Campos said his processing of the gambling proceeds for PokerStars and Full Tilt Poker was not in return for a $10 million investment in the bank.<ref>{{cite web|url=https://finance.yahoo.com/news/ex-utah-exec-gets-3-195533788.html|title=Ex-Utah exec gets 3 months in NY poker case|last=Neumeister|first=Larry|date=2012-06-27|publisher=[[Associated Press]]|access-date=2024-04-23}}</ref>

==References== {{reflist|colwidth=30em}}

==External links== *[https://web.archive.org/web/20110419230512/http://www.justice.gov/usao/nys/pressreleases/April11/scheinbergetalindictmentpr.pdf April 11 press release of Indictment] *[https://web.archive.org/web/20111018033321/http://www.justice.gov/usao/nys/pressreleases/September11/amendedfulltiltpokercomplaintpr.pdf September 20 press release of amended complaint] *[http://www.pokerstars.com/usaplayers/faq Pokerstars U.S. Player FAQ] *[https://www.justice.gov/usao-sdny/pr/pokerstars-founder-pleads-guilty PokerStars Founder Pleads Guilty]

[[Category:United States District Court for the Southern District of New York prosecutions|Scheinberg, Isai]] [[Category:United States computer case law]] [[Category:United States gambling case law]] [[Category:Online gambling]] [[Category:Poker and society]] [[Category:2011 in United States case law]] [[Category:2011 in poker]] [[Category:2011 in American television]] [[Category:2011 controversies in the United States]] [[Category:Domain name seizures by the United States]]