Category: Gambling and Poker

Late Friday Links

Friday, April 13th, 2012

Morning Links

Tuesday, December 27th, 2011

Saturday Links

Saturday, December 24th, 2011
  • Nevada legalizes online poker. Of course, that’s the one state where they don’t really need it.
  • Ex-cop won’t do jail time for multiple arsons.
  • More genius from Lawrence O’Donnell.
  • Obama breaks another campaign promise.
  • “As was the case in 2010, the main obstacles to a GAO opinion on the accrual- based consolidated financial statements  were: (1) serious financial management problems at the Department of Defense (DOD) that made its financial statements unauditable, (2) the federal government’s inability to adequately account for and reconcile intragovernmental activity and balances between federal agencies, and (3) the federal government’s ineffective process for preparing the consolidated financial statements.” But sure. Let’s give them more control over health care, too. (Via Peter Suderman.)

Sunday Links

Sunday, November 20th, 2011

Morning Links

Wednesday, November 9th, 2011

Morning Links

Monday, October 10th, 2011

Full Tilt Poker Pros Named in Federal Civil Suit

Tuesday, September 20th, 2011

Full Tilt Poker partners and poker pros Howard Lederer and Chris “Jesus” Ferguson have been added to U.S. Attorney Preet Bharara’s  civil case against against the company.

The amended suit accuses Full Tilt of being a Ponzi scheme that paid executives with funds that were supposed to be reserved in player accounts. Skeptical as I generally am of the government in these cases, a cursory reading of the relevant information suggests to me that Full Tilt was at minimum guilty of making some really stupid and likely fraudulent business decisions. From what I can tell, in an effort to stay operational after the feds brought down the hammer, Full Tilt continued to pretend to process deposits from U.S. players, even though it hadn’t lined up a legal processor to conduct the transactions. (Because the feds had already arrested and charged the executives of any processing company that tried.) So they were crediting accounts without actually withdrawing money from the players whose accounts they were crediting.

Shortly after the indictments, the feds then barred the company from processing any more payments from U.S. players, but simultaneously told players they could still use the site to cash out their accounts. Full Tilt couldn’t come remotely close to covering the ensuing run. That isn’t really a Ponzi scheme. But if true, it’s certainly not on the up and up. If Full Tilt executives were misleadingly running the site like a (poorly run) bank, I’d imagine that’s a pretty good case for fraud. It’s also fraudulent (and crappy business practice) to pay out your executives and celebrity endorsers first, while knowing that you can’t pay your players the money you promised them was protected and kept separate from general operating expenses. (I’m sure it’s illegal, but unlike the allegations above, I can’t personally conjure up much moral outrage over the allegation that Full Tilt disguised billing codes to get around the Unlawful Internet Gambling Enforcement Act.)

How much Lederer and Ferguson knew about all of this remains to be seen. (Disclosure: I’ve met and like both, so I hope their involvement was minimal.)

I’m sure opponents of online poker will cite all of this as proof that they were right, that these sites are havens for fraud, money laundering, and all sorts of other criminal enterprise. But the reason offshore sites were so popular in the first place is that it was and is illegal for any company based in the U.S. to provide online poker to U.S. residents, despite the fact that millions of U.S. customers clearly want to play. Full Tilt was trying to fill that demand, first legally, then by operating in a legal gray area, and finally (allegedly) by trying to circumvent the law. That doesn’t excuse the company from defrauding its customers, if that’s indeed what happened. But the government has been standing between the millions of people who want to play poker online and the companies that want to provide them with that service legally. This is what happens when you create black and gray markets. It is entirely predictable.

I’ll reserve judgment for now on whether Full Tilt’s legal problems amount to intentional fraud or dumb mismanagement wrought in part by trying to stay up and running even as the feds continued to slam doors. My best guess is it’s mostly the latter, combined with a bit of the former as it became clear the gig was up. What is abundantly clear is that the federal government’s paternalistic efforts to “protect” online poker players from losing money to offshore gaming sites . . . was a colossal failure.

MORE: See this comment from Mike C., who says meshing of player accounts with operating expenses was going on well before last year’s indictments. I’ve also now read the full indictments, and from here it looks pretty bad all around for Full Tilt and its executives. Of course, we do have trials for this sort of thing. So we’ll see how they go about attacking the complaint when the time comes. But the feds depict some really shady stuff going on, well beyond just trying to figure out how to keep the site operational.

MORE: This post initially indicated that Lederer and Ferguson had been indicted. That isn’t true. They’ve been added to the fed’s civil complaint. I’ve changed the post to reflect this.

Another Poker Raid (Update and Bump)

Sunday, July 10th, 2011

This one was here in Tennessee:

 Knox County Sheriff’s Office deputies raided yet another allegedly illegal gambling operation Wednesday night.

The latest raid targeted a poker game inside a private residence in the Bexhill subdivision in West Knox County, according to a KCSO spokeswoman Ashley Haynes.

Deputies discovered eight people around one poker table at 1304 Buxton Drive, and seized approximately $1,000 cash, Haynes said.

No arrests were made, but all information was turned over the Knox County District Attorney General’s Office for possible charges, she said.

I was going to make your usual “Knox County can sleep safer now” comment until I did some poking around and found this poker raid in Chattanooga last April, in which the police spokes-sergeant makes my point for me, only without the sarcasm:

“Any arrest obviously reduces crime in our city and a crime reduction means safer streets and safer communities.”

MORE: Via the comments, here’s more on the Knox County raid. It’s looking more and more ridiculous. Here’s a comments from a woman who says she’s the owner of the home that was raided:

Thanks for the comments folks. Here is the problem with the raid they did at my home Tuesday. There were 8 people there the lady who let them in even with my reservations with the deputy on the phone who threatened arresting everyone there and getting warrants ( you see I was not at home I was and still am in the hospital). The lady was doing laundry My other roomate and two friends were playing a card game called Fantan its like 3 way solitaire on a poker table left out from our holiday get together Sunday. Fantan requires you to chip if you cannot complete a sequence – wel l since you can only play with 3 l dont see where 8 people around a table playing poker came in. There were other guests there watching TV and enjoying a quiet evening. The deputies claimed they were gambling because chips and cards were involved.

Here’s a follow-up:

they conficated my tables to be stored after our holiday party they broke them because they were too lazy to take them apart, they took non-denomination chips that we use for tourneys, the money they confiscated was not gaming money it was personal property of my guests in their pockets, in their search they found poker paperwork had stats and point values, my cell phone because it had poker related pictures and last names that said poker not last names, and a 2lb bag of epsom salts that they recorded on a receipt as drugs. 2 computers mine and my housemates My problem is they have embellished the truth with each raid to Justify to the public the “good” they were doing. I am outraged that they have my neighbors thinking I am some criminal because I play poker! Heck their coworkers, other law enforcement areas have been to games I have played in and hosted what about them?

Forfeiture Fraud

Friday, June 17th, 2011

Working with the feds, the Anne Arundel County, Maryland, Police Department set up a fraudulent payment processing business for online poker players. They then took the players’ money, under false pretenses, and deposited it in the federal government’s asset forfeiture fund. Complaining players, none of whom were ever charged with a crime, were told they’d have to try to recoup their losses from the poker sites, which of course have now had their assets seized in a separate federal investigation, and which never actually saw the money from these particular players, anyway.

Under federal “adoption” policy, any local police department working with the federal government in a criminal investigation gets to keep up to 80 percent of the property it seizes in that investigation. And once the feds get involved, the whole thing officially becomes a federal investigation, which allows local police departments to skirt state laws aimed at protecting citizens from forfeiture abuse.

In this case, the Anne Arundel Police Department bagged $30 million seized stolen from online poker players. They celebrated with a press conference and oversized novelty check. They’ll use the money to buy some cool new police equipment. Let’s hope it’s for more SWAT gear, so they can feel a bit safer the 150 times each year Anne Arundel County SWAT teams are deployed, most of the time to serve search warrants that result in misdemeanor charges.

I love the line from the U.S. Attorney’s Office in Baltimore: “The government is not going to give the money to gamblers.” Except for the working stiff who finally wins $100 after spending $500/month on the state lottery for 10 years. Then the government will gladly give money to gamblers. Because they know they’ll get it right back.

(Via Amy Alkon)

Welcome to Global Jurisdiction

Sunday, May 29th, 2011

A U.S. citizen has been arrested in Thailand for insulting the Thai king on the Internet. Each alleged defamations carrries a sentence of 3-15 years in prison.

This is obviously terrible, and I hope the guy is released. But the premise here is no different than when the U.S. government arrests the executives of online gambling sites at U.S. airports and charges them under U.S. law, despite the fact that online gambling is perfectly legal in the countries where they’re citizens and where their companies are incorporated.

We set a pretty nasty precedent here. I don’t see how the U.S. government has much moral standing to demand this guy’s release.

Obama: Worse Than Bush on Bullshit Gambling Moralizing, Too

Friday, April 15th, 2011

The Obama Justice Department has indicted executives from the three largest online poker sites—Full Tilt, Absolute Poker, and PokerStars—on charges of money laundering and bank fraud.

This is the by far the most serious federal attack on online poker to date. I just checked my Full Tilt account. The site still appears to be up, but it isn’t accepting payments. Or at least it didn’t accept mine. The L.A. Times article linked above says Full Tilt’s website was down with an FBI seizure notice put up in its place. But as of this writing, it appears to be back up.

Good to know where the DOJ’s priorities lie. In this case, it’s preventing millions of people from consensually wagering money in online card games, an exchange that causes no harm to anyone else.

I predict this is going to prove to be a politically foolish move. Poker players are young, wealthy, and tend to be progressive on social issues. Reaction from the Poker Players Alliance here.

Reason on online gambling here.

Morning Links

Wednesday, March 30th, 2011

Morning Links

Thursday, February 17th, 2011

Justice for Sal Culosi

Monday, January 17th, 2011

My column this week looks back at the Sal Culosi case. Culosi was killed by a Fairfax, Virginia SWAT team five years ago this month. Last week, his family settled with the county for $2 million. As I argue in the column, a settlement that large in a hard-to-win lawsuit against a police officer is an admission of guilt, no matter how county officials will try to spin it.

Protectionism at Work

Wednesday, January 12th, 2011

Thanks to reader Robert Neinast for sending this ad, which appeared in the Columbus Dispatch.

In case you can’t read the fine print at the bottom, it says:

Paid for by: California Indian Nations Gaming Commission