An order has hit the docket in the Black Friday prosecutions in New York. In it, Judge Lewis Kaplan indicates that the court will consider an upward adjustment in Mr. Beckley’s sentence on the ground of “an aggravating circumstance.” What does this mean?
In Mr. Beckley’s plea agreement, the government and he agreed that his U.S. Sentencing Guidelines range was 12-18 months’ imprisonment for both of the counts to which he pleaded guilty, meaning that it would not be unreasonable to expect that his custodial sentence would fall somewhere in the range of 12-18 months. However, these are only guidelines; the court has the power to take into account circumstances that it believes have not been adequately covered by the sentencing guidelines. In this case, the applicable guideline places a premium on “the reasonably foreseeable pecuniary harm” to the bank under the plea to the bank fraud conspiracy count. From a reading of the order’s text, the government is “not in a position to establish pecuniary harm.” However, Judge Kaplan states that the defendant “conspired to circumvent, and circumvented, governing laws of the United States in order to conduct or facilitate an unlawful business or businesses involving billions of dollars from which those businesses gained many millions of dollars.” The judge is concerned that the guideline’s heavy emphasis on loss might not result in an “appropriate” sentencing range and, therefore, appears to believe that an upward departure may be warranted in Mr. Beckley’s case.
You hear a lotta stuff … ok, maybe not so much now without 2+2 … but regardless, I go to our Manhattan-based pal Wendeen in matters of DOJ vs. Full Tilt/PokerStars et al … and sure, even though I was all over so-called poker radio screaming that there wasn’t a chance the supposed GBT/Full Tilt bailout plan would go through, Pokerati was just spouting on “instinct” and maybe “hunch” while Wendeen was collecting actual data to either confirm or deny various pieces of the ongoing online poker saga unfolding in her SDNY back yard.
Check out her latest in Poker Player Newspaper — Full Tilt Creates Drama at PokerStars. Wendeen doesn’t seem as willing as I am to flat-out scoff and pshaw at any suggestion that PokerStars could swoop in and “save” Full Tilt (while saving itself for less than a billion) … but she does provide more facts to put any emerging hubbub in context — including some rather interesting narrative about PokerStars’ designs on going public and American banking giant Morgan Stanley’s interest in online poker sites prior to Black Friday.
A good companion piece of reading is DiamondFlush’s GBT post-mortem, which includes the email Laurent Tapie sent to his extended inside circle, giving not only his presumably honest perception of the deal as it went afoul, but also insights into some of the hard, painful numbers in play.
Yesterday marked the anniversary of online poker’s Black Friday. Anyone who ever clicked a raise button remembers the fateful day, and many are reminiscing about how their world changed on April 15, 2011.
Here’s a best-of list of links, tweets and general brooding from over the weekend:
QuadJacks.com did a special anniversary live podcast, which included “original Black Friday audio.” Ah, the memories. http://quadjacks.com/poker-radio/
A bunch of pros, like Matt Waxman, told PokerStrategy.com that this year’s WSOP Main Event should hold steady. “It’s like so prestigious and like world renowned, you know, so everybody’s gonna just make it out cause this is the one tournament that like if you’re the guy who plays the nightly home game for 100 bucks, you’re gonna splurge your 10k just so you can play in the main event,” he said. Like riiiight. http://www.pokerstrategy.com/news/world-of-poker/Daily-Rewind-Black-Friday-Anniversary,-New-Gambling-Film,-WSOP-2012-Thoughts_58570/
When Calvin Ayre got indicted this past week, some were wondering what took so long … because if the DOJ couldn’t nab the brashest of online gambling kingpins (Bodog did sports-betting for chrissakes!) then there had to be a formula — a legal-enough way to run an online gambling empire while steering clear of America’s internet police.
Stu notes that the investigation leading to Bodog’s shutdown wasn’t singular in scope, and asks who might be next on the DOJ’s hit-list. The answer to that question, I believe, is in the indictment itself — and though they don’t name any magazine or website by brand, the DOJ does reveal that after more than five years of investigation they consider certain media part of a criminal conspiracy to facilitate illegal online gambling.
6.Through these communications, members of the conspiracy caused the media reseller to create and execute an advertising campaign to increase the participation by gamblers in the United States on the BODOG.com website.
7. Through these communications, members of the conspiracy caused the media reseller to send invoices to BODOG ENTERTAINMENT GROUP S.A., d/b/a BODOG.com. These invoices represented the costs and fees for the creation and execution of the advertising campaign.
8. Members of the conspiracy caused funds to be sent by wire from accounts located outside the United States to accounts located in the United States to satisfy the invoices sent by the media reseller. These wire transfers totaled more than $42 million during 2005 through 2008.
Check out Wendeen Eolis’ story over at Poker Player Newspaper, the Manhattan-based poker journo who apparently isn’t gonna let the young whippersnappers at Subject:Poker and QuadJacks bastardize the reality of what’s going on in her courtside stomping grounds as this DOJ vs. old-school online poker story unfolds.
Just last week Wendeen laid out why the supposed “Tapie Deal” isn’t taking shape the way many purport (didn’t someone say FTP-Europe would be up and running by now?) … and she follows that up with a little shameless expose on PokerStars and the cloak of secrecy covering many of their operations — modus operandi she contends became the norm for a company that couldn’t at once be biggest in the world while still trying to fly beneath various legal radars.
From PPN:
Reports from current and former employees, consultants, business partners, Team Pro players, and media brought many verified vignettes that highlight the secretiveness of the company. The various accounts share a common theme; they all indicate a core value of camouflage that permeates so many of the company’s significant initiatives.
Yeesh, happy Valentine’s Day to someone!
Also extra-fascinating is a part of her story suggesting that PokerStars’ efforts to get poker declared a game of skill could be what does them in, financially, because of European tax laws.
The Facebook-facing poker site’s interest might seem reasonable in light of the Department of Justice’s recent re-interpretation of the 1961 Wire Act, limiting the scope of its prohibitions to sports betting. But there is also a more cynical interpretation of Zynga’s announcement.
With its stock price languishing after its initial public offering, Zynga needed a growth storyline that shareholders might believe. I could write more about why Zynga’s announcement may be more of a semi-bluff than a made hand, but an online gaming insider has done that already. Bill Rini asks Zynga Ready For Real Money Gaming or Trying to Hide Failures?
Shares of Wynn Resorts tumbled on January 12 when it came out that a Wynn director and major shareholder had filed a lawsuit against the casino company. Turns out Kazuo Okada, one of Steve Wynn’s original partners, is claiming the company made a questionable $135 million donation to the University of Macau and hasn’t been sharing its financial information with him. Reuters has a nice write-up here.
The veiled implication is Wynn’s sizable donation might have been less than philanthropic – bordering on a ”pay to play” ante to retain favor in the world’s most lucrative gaming destination. (The competing Las Vegas Sands’ Macau operation is currently under DOJ and SEC scrutiny for possible infringement of the Foreign Corrupt Practices Act, as referenced here in a Wall Street Journal blog.)
Wynn claims Okada’s lawsuit is just a smoke screen to mask the fact that Okada had been working behind Wynn’s back to develop a casino in the Philippines. You can read all the tawdry details in A Partners’ Fight Erupts at Wynn.
How will it end? Perhaps better than Steve Wynn’s marriage. After all, Wynn recently told the press, “I love Kazuo Okada as much as any man that I’ve met in my life.”
Wynn shares have since recovered from the drama at the start of January, but still have a ways to go in 2012 before reaching 2011 highs.
Too Soon? PokerStars is proud to announce that this has never happened on any PokerStars Caribbean Adventure.
PokerStars may be without a CEO for the time being, as Gabi Campos, who assumed the chief executive position in 2010, reportedly is no longer big boss of the largest real-money online poker site in the world. While it’s not quite clear who told whom to eff off (and Stars has yet to put out a press release insisting all is hunky-dory) … if confirmed, Campos’ ouster/skeedaddling marks the fourth major executive departure at PokerStars since Black Friday.
First to be disappeared (amid some controversy) was veteran EPT Tournament Director Thomas Kremser in May; then last month, EPT founder John Duthie left. And now supposedly Jeffrey Haas, top dog at Global Poker Tours Limited (parent company for PokerStars live events) has been, er … moved on. (Haas’s LinkedIn page lists GPTL as “Past” … and “Director of New Platforms, Mobile & Social Gaming for Pokerstars.com” as current — sounds like “big-money suit demoted to glorified blogger” to me, but hey!)
UPDATE: Interestingly, Campos’ LinkedIn-from-Israel doesn’t list PokerStars as a past or present employer … says he his now working for 888-subsidiary Dragonfish, which we know, of course, in 2010 became an online partner to the WSOP.
Despite Black Friday, PokerStars has maintained its position as the world’s biggest, arguably most important, and possibly most highly regulated and therefore internationally legitimate online poker site. (And they set a Guinness World Record to boot!)
The US Department of Justice, meanwhile, maintains that PokerStars’ success was built on the ill-gotten gains of an illegal enterprise with ties to organized crime … and their founder is still, according to the DOJ, the #1 most wanted online poker criminal.
DOJ prosecutors keep moving up their ladder of bad guys in the unlawful internet gambling case against Isai Scheinberg et al. Brent Beckley, the 31-year-old father of two and a co-owner of Absolute Poker, told a Manhattan judge he did indeed lead a company that deceived US banks to circumvent US law, and acknowledged conspiring with others to commit bank and wire fraud. Beckley will likely serve 12-18 months in prison as part of a plea agreement, Reuters and the New York Times report.
This probably doesn’t bode well for other Black Friday defendants who face more severe charges and still haven’t stepped foot into US court. Though I haven’t seen actual documents on this one yet (readers please feel free to send a link or pdf), I’d be willing to bet (on this-here internet?) that the plea deal does not cut Beckley any slack because Absolute Poker patches said “dot net”.
We spend so much time reading about poker legal developments here at Pokerati that we sometimes forget to share the relevant news before the cycle turns to something else … and then I complain that our readers here aren’t as smart anymore as they used to be? It doesn’t take a JD to see the flaw in my logic there. Thus, here’s a much-needed batch of recent highlights and hedlines to keep the incessant but important buzz in context … a semi-special link-dump, btw, brought to you by our new-good friends at LegalPokerSites.com:
First UIGEA Conviction in the Books The DOJ logged their first win on UIGEA charges — making the supposedly weak law thus far undefeated — against online sportsbook operator Todd Lyons. His arrest back in May 2010 shoulda been a big warning sign to American online poker operators (and players?) — and Full Tilt specifically — that the DOJ was coming to get them! [CalvinAyre.com]
First Black Friday Trial Date Set John Campos and Chad Elie, the Utah banker and PokerStars payment processor indicted for their role in online poker criminal activity, have a trial date in March … creating a tangible timeline for Black Friday cases and added pressure on the big fish the DOJ really wants — Isai Sheinberg, Ray Bitar, and Scott Tom. [Legal Poker Sites]
MGM Sues Poker Domain Squatters Just as Caesars sued (and won) to obtain the domain WSOP.com, MGM has filed suit to repossess the domains mgmpoker.com, bellagiopoker.com, luxorpoker.com, mandalaybaypoker.com, and ariapoker.com. Apparently the casino giant thinks they’ll have need for them soon. [VegasInc]
Barton Says Online Poker Bill Still Alive This Congress Rep. Joe Barton (R-TX) gave a luncheon keynote at the DGLP, where he spelled out how his online poker bill is moving forward as a piece of stand-alone legislation and/or still could be absorbed into some omnibus bills. Pretty straight-forward, honest-sounding stuff as Barton even talks about his own live real-money play and admits to multi-accounting for play money on PokerStars. [Pokerati Soundcloud]
Adelson Balks at Readiness for Online Poker The poker masses got spun into a tizzy after Vegas politico Jon Ralston “reported” that Las Vegas Sands Chairman Sheldon Adelson has been buzzing around DC that he is morally opposed to online gambling … and that age-verification technology isn’t ready yet. Ralston concludes that this could kill online poker’s chances in Congress as if Adelson alone is more powerful than the combined forces of Caesars, MGM, Steve Wynn, Station Casinos, Boyd Gaming, Michael Gaughan, et al. Quick to cry, some poker players have begun calling for a boycott of Venetian Poker. [Las Vegas Sun]
Nevada Regulations Almost Ready While so many chatter about complex details of future online poker, the Nevada Gaming Commission and State Gaming Control Board seem to be the only ones systematically moving forward with thorough, enforceable rules and regulations for online gaming. In one of the biggest overhauls to state gaming regs in history, they just released a whole bunch of revisions for licensure and suitable ownership that Big and Small casinos alike are paying close attention to. [gaming.NV.gov]
Fry Howie? Funny/sad, shortly after Black Friday I thought we might be seeing T-shirts that said “Free Howard!” not “Fry Howard!” But loyalty can be a fickle bitch when you eff up with someone else’s money. Hence this flash creation for players wishing to express their personal outrage against Full Tilt and Howard Lederer violently. [PokerListings]
UB Player Database Leaked Lots of offline debate over how and why nearly 3 million poker-player IDs leaked out. Work of a disgruntled employee or scuttling the ship before UB ultimately hits sea-floor? And will there be more such pressings of self-destruct? [Haley's Poker Blog]
Rest o’World: Cyprus on Crackdown, South Africa’s Open-Market Mind, German Pre-unification Some of the other key political moves from the rest of the world, as the future of legal online poker (and gambling) actively takes shape … the mediterranean island that isn’t Malta doesn’t have moral opposition, they just want their cut (kinda like Kentucky) … while South Africa continues its progressive-minded movement from staunch opposition to tolerance to active support of online gambling … all while the German province of Schleswig-Holstein’s acceptance of new online poker rules is so big it actually moved some major market needles. [Legal Poker Sites]
The DOJ has laid out more of its case against Isai Scheinberg, Ray Bitar, et al — in a 58-page response to the response from two Black Friday indictees, payment processor Chad Elie and the Utah banker John Campos.
The People vs. Online Poker
Among other denials, Campos and Elie sought to get much of the case thrown out on the grounds that the UIGEA is a bad law and/or poker isn’t gambling. With the action back on the DOJ, Preet Bharara assistant Arlo Devlin Brown delivers some rather compelling legal composition (the best writing is in the footnotes, imho) that reads like a big STFU from SDNY … with a message of hey, better watch it or we could indict the whole damn poker industry!
Rock Paper Scissors? The last time a rich French dude came to New York to bail out the Americans was Rochambeau in 1781 — fewer than eight WSOPs before George Washington established the DOJ office currently trying to put the hurt on various Tiltboys.
Still trying to wrap my teeth around the latest chapter in the saga of the Rise and Fall of Full Tilt Poker, with the Bernard Tapie Groupe in France saying the DOJ has given them a thumbs up on the purchase of certain Full Tilt assets … with which they’ll supposedly be able to make-good with Full Tilt’s non-American players and resume non-American operations.
So if this is correct — and we can talk later why we presume more truth in this story than others before it — Preet Bharara and his top-ranked American prosecution office wouldn’t have to worry about the Euros … which would be good for the DOJ, I presume, because who needs to mess with the foreigners and the incredibly complex international litigation and trade wars they potentially bring … especially when the real prize Preet seeks is closer to $1 billion.
For a better understanding, be sure to check out Wendeen Eolis’s latest piece in Poker Player Newspaper — Decoding Full Tilt Poker – DOJ – Tapie Plans — which provides a much needed sobriety check and skillful reading between the lines. Even though she may not be on the frontlines like Subject:Poker, as a Manhattan legal consultant in her non-poker life, Eolis has been down to the battlefield a time or two … and seems to understand ways the Southern District of New York more intimately than most.
The Tapie deal does offer the first glimmers of light at the end of a long tunnel, but it seems American players might wanna hold off on calls for “ONE TIME!” lest they become self-fulfilling prophesies of disappointment and despair. Because for any justifiable exuberance over the likelihood that European and “rest of world” players might see PokerStars-style payouts before the end of 2011 … American players with online poker (bank?) accounts in limbo now know only that the DOJ will be looking at them separately in determining who’s a “victim” and who is Isildur1 who’s potentially a less deserving accomplice.
The big news this week is PPA’s meeting with the Department of Justice regarding player funds locked up on Full Tilt Poker, Absolute Poker, and Ultimate Bet. Needless to say, this is at the forefront of the concerns of the membership and of the PPA, so I am pleased to report that your PPA has been proactive in pushing for restitution for our members.
From Executive Director John Pappas:
“We still have an open dialogue with [the DOJ] and look forward to more productive conversations down the road. We plan to follow up to make sure the DOJ gets a guarantee that players get restitution through any deal with new Full Tilt management.”
The big news last week, of course, was the signing of the acquisition agreement between Groupe Bernard Tapie and Full Tilt Poker. Player repayment is being promised by the parties involved. Here is a quote from a Washington Post article on the matter:
Full Tilt said the agreement includes a plan to repay balances of players worldwide who haven’t had access to their gambling funds since April.
Needless to say, it is my hope that we all get repaid in full as soon as possible. More specifically, it is my hope that the Justice Department will, once obtaining iron-clad guarantees of repayment from any party wishing to purchase Full Tilt Poker, work to fast-track settlement of all outstanding issues. As the DoJ has identified players as the victims in all of this, I expect they will welcome a settlement that addresses player restitution.
I gotta think representing himself pro se against the DOJ was not part of the original plan. But that’s the real story (imho) yet to be noted in Ray Bitar’s claims that he wants some of his property back (including two bank accounts in Pokerati’s old Dallas stomping grounds).
Have a look at the document. He filed the motion himself — “Verified Claim of Raymond Bitar, Pursuant to Rule G of the Supplemental Rules for Admiralty and Maritime Claims” — with an Irish notary public to make it official.
I certainly don’t know the nuances of Rule G of the Supplemental Rules for Admiralty and Maritime Claims, but it seems complex enough that an attorney might-should usually be filing this kinda thing. And the lack of legal counsel’s involvement in this civil matter raises plenty of questions about the financial status of Bitar … and maybe even the motivations of various comments by Full Tilt attorneys who may or may not be still be getting paid.
JoeOE18: Had a great session with Deus Ex. Then got to another boss. Contemplating giving up and moving on to something fun. Wish there were cheats. 18 hours ago
Play-money poker giant Zynga hinted last week that it conceivably 
Shares of Wynn Resorts tumbled on January 12 when it came out that a Wynn director and major shareholder had filed a lawsuit against the casino company. Turns out Kazuo Okada, one of Steve Wynn’s original partners, is claiming the company made a questionable $135 million donation to the University of Macau and hasn’t been sharing its financial information with him. 
The big news this week is PPA’s meeting with the Department of Justice regarding player funds locked up on Full Tilt Poker, Absolute Poker, and Ultimate Bet. Needless to say, this is at the forefront of the concerns of the membership and of the PPA, so I am pleased to report that your PPA has been proactive in pushing for restitution for our members.
