Thread: US DOJ shuts down PokerStars, Full Tilt Poker, and Ultimate Bet / Absolute Poker

Excerpt from the Las Vegas Sun
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"In light of the recently announced federal indictment of several PokerStars principals, as well as the revelation of PokerStars-sponsored foreign trips by Nevada Legislators, and news of nearly $300,000 in political contributions by PokerStars to Nevada legislators who are currently considered proposed legislation introduced on PokerStars’ behalf, I am calling for federal and state investigations into PokerStars’ political activities in Nevada. The fact that a foreign company which has been charged with operating a criminal enterprise could play such a large role in Nevada campaigns is troubling. Federal law clearly prohibits foreign contributions to federal, state, and local campaigns. Nevada law is not so clear, but should be. I am reviewing this issue with legislative counsel and plan to introduce legislation, if necessary, to ensure that any loopholes in our state law are closed immediately. In addition, I will be discussing this matter with both the U.S. Department of Justice and the Nevada enforcement authorities to determine whether federal and state investigations into PokerStars’ activities in Nevada are warranted. Nevada’s gaming industry and regulatory regime are the very best in the world, and it is critical that we take swift action to ensure that we maintain the unquestioned integrity of both."

Money laundering is one of the charges levied against the 11 defendants by the federal government.

The Money Laundering Control Act, (18 U.S.C. §1956), has a few essential elements that the government must prove or the charge won't stick.

(1) Whoever, knowing that the property involved in a financial transaction represents the proceeds of some form of unlawful activity, conducts or attempts to conduct such a financial transaction which in fact involves the proceeds of specified unlawful activity—
(A)
(i) with the intent to promote the carrying on of specified unlawful activity; or
(ii) with intent to engage in conduct constituting a violation of section 7201 or 7206 of the Internal Revenue Code of 1986; or

(B) knowing that the transaction is designed in whole or in part—
(i) to conceal or disguise the nature, the location, the source, the ownership, or the control of the proceeds of specified unlawful activity; or
(ii) to avoid a transaction reporting requirement under State or Federal law,
shall be sentenced to a fine of not more than $500,000 or twice the value of the monetary instrument or funds involved in the transportation, transmission, or transfer, whichever is greater, or imprisonment for not more than twenty years, or both. For the purpose of the offense described in subparagraph (B), the defendant’s knowledge may be established by proof that a law enforcement officer represented the matter specified in subparagraph (B) as true, and the defendant’s subsequent statements or actions indicate that the defendant believed such representations to be true.

(3) Whoever, with the intent—
(A) to promote the carrying on of specified unlawful activity;
(B) to conceal or disguise the nature, location, source, ownership, or control of property believed to be the proceeds of specified unlawful activity; or
(C) to avoid a transaction reporting requirement under State or Federal law,
conducts or attempts to conduct a financial transaction involving property represented to be the proceeds of specified unlawful activity, or property used to conduct or facilitate specified unlawful activity, shall be fined under this title or imprisoned for not more than 20 years, or both. For purposes of this paragraph and paragraph (2), the term “represented” means any representation made by a law enforcement officer or by another person at the direction of, or with the approval of, a Federal official authorized to investigate or prosecute violations of this section.

Basically the US must prove, in a nutshell

1 - that a financial transaction was attempted OR completed
2 - The defendant knew that the financial transaction involved proceeds of an unlawful activity
3 - The property was in fact proceeds of an unlawful activity
4 - The defendant acted with intent to do any of the 4 activities under Section 1956 (a)(1)(A) and (B)

Some of the defendants, people already inside the US, have already turned themselves in or will be turning themselves in. There has been a question as to whether or not the US will get their hands on the people abroad. Well, the MLCA provides for that.

(2) Jurisdiction over foreign persons.— For purposes of adjudicating an action filed or enforcing a penalty ordered under this section, the district courts shall have jurisdiction over any foreign person, including any financial institution authorized under the laws of a foreign country, against whom the action is brought, if service of process upon the foreign person is made under the Federal Rules of Civil Procedure or the laws of the country in which the foreign person is found, and—
(A) the foreign person commits an offense under subsection (a) involving a financial transaction that occurs in whole or in part in the United States;
(B) the foreign person converts, to his or her own use, property in which the United States has an ownership interest by virtue of the entry of an order of forfeiture by a court of the United States; or
(C) the foreign person is a financial institution that maintains a bank account at a financial institution in the United States.

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Since this case likely involves numerous complex transactions it's likely that money went to and from the US. This is a white collar crime and the death penalty won't be an option so I fully expect foreign countries to extradite the named defendants. The only time a country resists is when the death penalty is on the table.

According to pokerscout FTP lost half it's traffic and pokerstars lost about a quarter. This doesn't surprise me as stars had a much bigger player/global base.