A little Google-translate suggests there’s a lot more to this case than just a guy in Florida getting carried away with online poker money transfers. Apparently the detainee, Michael Schuett, is an accused fraudster in Germany who has been on some sort of run hiding out in the USA. A German website exists for the sole purpose of outing this man’s alleged crimes — USAG24-Betrug, or, in English, USAG24 Scams: As Michael Schuett Still Cheating.

The basics:

Preface
You might wonder why there is this page. Well, I also have the services of Michael Schuett, alias adopted USAG24 Inc. and has been cheated a lot of money. Meanwhile, there are quite a lot of people who feel the same way.

The people who have resisted and have published their case as the Internet, were then put massive pressure from Michael Schuett and most have agreed to the cancellation of their websites. This of course happened after agreeing a settlement, for example, was paid some money from Michael Schuett so that the matter is created from the world. Most of these people have only received a fraction of the lost money again and had to return the sites to take from the net.

Thus Michael Schuett is still continuing its Betrügerein. I will not comment on such a comparison and the money had already been written off as dearly as I will have to deal with this person any more. However, I would keep everyone else from dealing with that person and any company business.

Your USAG24-dupe

Now for all we know this is just one disgruntled ex-colleague. But he’s had a twitter feed set up for the past three months just to track the whereabouts of this one person. @usag24betrug has three followers.

And here’s a half-hour lifestyle documentary on Michael Schuett, apparently chronicling his move to Florida:

Very strange. Might online poker sites be a victim of a fraud here? Or just tangled up with the wrong guy? I’m still not sure what to make of it all, but I do get the sense now that this situation may turn out to be about more than online poker …

Still making sense of it all, and how this is different from other poker-related money seizures and charges against Canadian Douglas Rennick … but it looks to be something big, and a new level of poker prosecutions.

Here’s the story from the Naples News:

Feds investigate Naples man in money laundering probe tied to online gambling

It may or may not be coincidental that the the Feds have arrested Michael Olaf Schuett’s for money transfers directly related (allegedly) to online poker just as the state is taking a closer-than-ever look at the game with eyes on its revenue potential. It’s also not clear if Schuett’s been charged with anything yet, or is just being held because he is a foreign national flight risk with felony charges pending.

Here are some plausibly relevant names, and highlights that jump out at yours truly:

• Michael Olaf Schuett, or Schütt, is the guy they’re after. He’s a 29-year-old German whose visa expire in April. A federal judge has ordered him held in Lee County jail without bond.
• He lives in a pretty sick oceanfront condo.
• He’s been married only a month to a 28-year-old woman he’s known for only nine months. Her name is Jennifer Sherman.
• Feds allege that since opening accounts in 2007, Schuett has transferred about $70 million to 23,000 people, mostly Americans and supposedly online poker winnings.
• The giveaway was dozens of checks being received daily via Fed Ex.
• People cashing checks sent to them from Schuett claim they are online poker winnings.
• Secret Service is the law enforcement agency involved.
• Agents are seeking to execute search warrants and seize allegedly ill-gotten property, such as fancy cars and watches.
• The complaint lays out a web of money transfers between businesses and banks and players.
• Lots of American and Canadian banks in play. Key company serving as go-between: Bluetool Ltd. out of Germany.
• Supposedly no direct allegations in the complaint against any online poker sites, but the Naples News reporter was able to connect them to transactions from Full Tilt, PokerStars, and Absolute.
• Three specific players — Corey Drury, Darren Elias, and Derek Dubois — get named as receiving money through Schuett’s legally questionable operation. All three have public profiles on BluffMagazine, PocketFives, CardPlayer, and PokerPages.
• As banks became hip to the set-up, Schuett tried to create a new accounts to hold the money, claiming to be a real estate investor — a story the banks didn’t buy.

Even though I’ve gotten hooked on two-minute video interviews and have kinda taken a personal change-of-interest-pace and started paying attention to actual tournaments … big names are starting to win at the LAPC, WSOP-Circuit Tunica is kicking it old school, everyone wants to know how the Venetian Deep Stacks is gonna shape up with PokerStars heading to town, and I really gotta make it over to the M Resort to check out this whole PartyPoker Premier League thing … I still tune in almost-weekly to APCW Perspectives Weekly for a little catch-up on the international poker and online-gambling-related political scene for 10 minutes at a pop:

This week J Todd keeps us abreast of California and New Jersey’ desires to get in on the online gambling game from a state-size perspective, updates us on the online gambling fund-transfer cat-and-mouse game with MasterCard and Visa getting more serious (just three months before they are legally required to do exactly what they are trying to do), fingers the Eldorado Casino as a potentially shady site to avoid, and tease me with some affiliate business stuff that I don’t really care about but am interested to watch because of the hidden-camera + foreign-accent nature of the upcoming interview.

Here are a few other semi-related newsy links about how things are going elsewhere in the poker world:

The Mayor of Baltimore is pushing for poker+table games despite the governor of Maryland having less of an interest in making expanded gambling a priority.

Michael Barnier, the newly appointed EU Internal Markets Commissioner, promises to straighten out inconsistencies in European online gambling laws.

Police in suburban Alabama are cracking down on / raiding the real-money tournament scene there.

I’m kinda glad I didn’t respond to that spammish email trying to sell me pokerati.cn … the Commie reds are about to embark on a six-month, eight-agency crackdown on online gambling. Chinese officials did not respond to inquiries on whether or not running the campaign between now and August had anything to do with timing of the World Series of Poker.

Not sure how deep any in our industry have dug into the possibilities in China yet, but hey, that “Bodies” exhibit could probably use some new prisoners to pose playing poker.

More on the China crackdown, where you may notice vague similarities to what’s gone down in the US of A:

Online gambling “has caused large cash outflows from the country and seriously disturbed social and economic order,” said a statement posted on the public security ministry’s Web site Monday.

The campaign aims to “bust a number of syndicates from home and abroad that collude to organise gambling activities on the Internet and severely punish the illegal rings,” it said.

Authorities will also clamp down on underground banks and third party payment platforms that provide cash transfer services for gambling sites, as well as Internet operators that provide Web access services, it said.

“(We) will clean up gambling information and Web sites across the board,” the statement said.

There’s a little brouhaha I think outta Costa Rica that I’m not really following, but there might be something there. It involves PICClub … one of those loophole-based payment processing alternatives that has found itself embroiled in a 6-figure payment dispute with a network of smaller online poker sites (Carbon Poker, Reefer Poker, ACED, GR88.com, Felt Stars, StinkyFish Poker, and more than a dozen others).

Apparently someone’s ripping off someone, and flaming fingers are starting to point all willy-nilly in a world of folks trying to play as legit as they can providing a service that the US government would prefer they not.

I first learned about PICClub about a year ago … heard about it from one of my old cronies in the Dallas underground, and TJ Cloutier was apparently involved. Though I had decided it was not quite my thing, I wanted a second opinion, so I sought the counsel of a trusted friend and colleague semi-involved in the poker bidness:

On Dec 3, 2008, at 9:22 AM, [name removed] wrote:

[Name removed] told me about it. But I’ve decided it’s in my best interest to steer clear of shady, 4-year-late concepts that are audibly mistaken for porn sites.

LOL, right, exactly …

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It took some three years, but the mainstream media finally “gets it” … if not in print, than at least online. Check out the Newsweek blog post, “High Stakes for Online Gamblers“.

Not only have they finally figured out how to condense everything from the shady passage of the UIGEA to undesirable results of unregulated online poker and payment processor issues to a few sentences followed by some well thought out mainstream-friendly paragrafs, but also, at the end, they give a little hint at what might come next, which could involve Full Tilt fighting the matter in courts:

Even if the UIGEA is enacted, it’s unlikely online gambling would disappear completely. There are ways for American players to circumvent bank regulations, including setting up a foreign bank account. “We’re all holding our breath and hoping the petition will be accepted,” Lederer says, but that isn’t the industry’s only option. Online poker could be legalized through the courts on the argument that the Wire Act doesn’t apply to poker. The industry is waiting to see what happens Dec. 1 before taking any action, he says. But if they do head to court, Lederer likes the odds.

This is interesting, because time and time again poker has shown it can win in the judicial system, while the game-of-skill argument tends to carry no weight in legislative circles … where it’s still just gambling, and maybe a matter of personal freedoms at stake.

(I also gotta agree with Lederer … knowing FTP’s growing familiarity with the American court system, the money they’ve got to spend on lawyers, and “our issue’s” generally falling on the right side of the law … we all know where we’re eventually gonna get … it’s just a matter of how we get there.)

Good article by Shamus over on the Betfair blog explaining to the Euros these dodgy days for the USA as we face an certain deadline with uncertain implications related to the UIGEA.

And as always, you can find more intelligent commentary from a jingle-brained sap over at Hardboiled Poker.

via the PPA …

Sen. Jon Kyl (R-AZ) and Rep. Spencer Bachus (R-AL) have submitted their petition asking Treasury Secretary Tim Geithner and Federal Reserve Chairman Ben Bernanke to ignore requests seeking to delay enforcement of the UIGEA.

[DC] Bachus Kyl Letter (11/03/09)

Another example suggesting that change is afoot unless Barney Frank & Friends can save American-friendly online poker sites in 25 days or fewer when you count Thanksgiving:

Click above to see the full letter, and click below for my Google translation from corporate bank-speak to poker English:

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Not to get all Chicken Little, but while we’re a week away from crowning a new WSOP champion semi-live on TV … we’re three weeks away from at a ticking bomb blowing up in the poker industry.

Dec. 1 is the UIGEA enforcement deadline … and effective, appropriate policy wheels are supposedly in motion in Washington DC to get this theoretical D-day at least moved back. But if we fail, dare I say it, we’re FUCKED! facing significant new challenges.

Though I don’t have detailed-details — yo Mitchell, got a copy of the actual letter? — apparently banks are already letting their customers know that they will not be processing certain online gambling transactions, and even mention the UIGEA by name. Or is this just old news to Californians who have already had funds confiscated?

Mitchell the Razz Guy writes:

My bank wrote to tell me that they will no longer process these transactions:

“any wager which involves the use of the Internet, where such bet is unlawful under any applicable Federal or State law in the State or Tribal lands in which the bet or wager is initiated, received or otherwise made.”

The bank even updated their Deposit Agreement and Disclosure to include the UIGEA.

Again, I’m hesitant to presumptiously declare the Nagasaki to the UIGEA’s Hiroshima … but yeah … bing bang boom!

The Feds have made another grab at money in US banks that at some point passed through online gambling and/or poker sites — seizing three more accounts held by payment processors with claims that the undisclosed sums in them are “forfeitable”.

This time it was the Maryland district going after accounts in California belonging to HMD, Inc.

In late July, Maryland-based federal authorities seized six other bank accounts from Electracash, Inc., also a payment processor alleged to be involved in laundering “proceeds of an illegal gambling business”.

Click here for a little more detail in the Baltimore City Paper, along with the latest seizure warrants.

In all these cases, the US District Court in Maryland has kept investigators’ affidavits calling for the warrants under seal. The New York Southern District handled their June payment processor seizures the same way, until the folks behind Gambling911 filed a motion that forced the courts to unseal them (with redactions).

A year ago, Maryland authorities charged (but did not arrest) two men — Edward Courdy and Michael Garone — with money laundering connected to $24 million seized from various bank accounts during an ongoing investigation of Bodog. The charges against Garone and Courdy stem from two specific transactions they allegedly facilitated — one from Germany to Georgia (for $1.5 million), the other from Dublin to Nevada (for $2.4 million).

G911 claims the most recent payment processor seizures involve online gambling and operations other than Bodog.

It occurs to me that we might well see some poker on Court TV, too. If not … we should. Payment processors fighting for their freedom, hundreds of millions of dollars, and the rights (and money) of Regular Joe others … that’s good stuff! Especially if they mix some whammies in with it all.

A US District Judge has granted Costigan Media — the folks behind Gambling911 — their request to unseal seizure warrants and (heavily redacted) court documents related to the seizure of some $34 million that US attorneys allege are ill-gotten gains from illegal online gambling.

This is a semi-significant ruling because while the First Amendment has stood up for such requests in most criminal prosecutions, there is less case law directly addressing matters of civil forfeiture, according to Judge Laura Taylor Swain … but ultimately, yes, when thousands of American citizens are having funds they believe to be theirs seized by the government, yes, the public has a right to know what’s going on.

Click here for 49 pages of freshly released legal documents, not all of which look like this:

The losing side, btw, in this mini case-within-a-case are ultimately the same Manhattan federal prosecutors who followed up these payment processee seizures with an indictment against Douglas Rennick — the Canadian payment processor who faces more than 50 years in prison (cumulative), $1.75 million in fines, and the forfeiture of nearly $566 million on charges of fraud, money laundering, and illegal gambling operations for his doing business with websites such as Full Tilt, PokerStars, Ultimate Bet, and others.

That indictment, of course, may or may not have come coincidentally on the same day Sen. Robert Menendez (D-NJ) introduced a Senate bill that would effectively make all the issues being adjudicated above moot in the future.

Regardless of what’s in play there, I think it’s clear why, indeed online poker related money issues really can’t be handled in the shadows — as much as some federal prosecutors would like such transactions to stay that way.

Ed. Note: Will be curious to see what gets more views — the latest episode of Perspectives Weekly or Face the Ace. LOL. -dm

Breaking News! A grand jury has just indicted an online gambling payment processor! Plus, a New Jersey Senator rolls out new poker legislation, and affiliate programs change their Terms & Conditions!

From the Department of Justice:

Internet Gambling Payment Processor Charged With Bank Fraud, Money Laundering and Illegal Gambling Offenses

NEW YORK, Aug. 6 /PRNewswire-USNewswire/ — Lev L. Dassin, the Acting U.S. Attorney for the Southern District of New York, and Joseph M. Demarest, Jr., the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (FBI), announced today the filing of an indictment charging Douglas Rennick with bank fraud and other offenses stemming from his role in processing more than $350 million for Internet gambling companies. According to the indictment filed yesterday in Manhattan federal court:

Since at least 2007 through June 2009, Rennick opened a number of bank accounts in the United States under various corporate names, such as KJB Financial Corporation, Account Services Corporation and Check Payment Financial Co. In opening the accounts, he and his co-conspirators falsely represented that the accounts would be used for such purposes as issuing rebate checks, refund checks, sponsorship checks, affiliate checks and minor payroll processing. In fact, Rennick and his co-conspirators used the
accounts to receive funds from offshore Internet gambling companies that offered, variously, poker, blackjack, slots and other casino games. Rennick and his co-conspirators then disbursed those funds via checks to U.S. residents seeking to cash out their gambling winnings. Rennick and his co-conspirators provided false and misleading information to U.S. banks about the purpose of the accounts because the banks would not have processed the transactions had they known they were gambling-related. In
total, Rennick and his co-conspirators processed more than $350 million transferred from a Cyprus bank account to various U.S. bank accounts for this purpose.

Rennick is charged with one count each of conspiracy to commit bank fraud, conspiracy to engage in money laundering and conspiracy to operate an illegal gambling business. If found guilty, Rennick faces a maximum term of 30 years in prison and a $1 million fine on the bank fraud charge, 20 years in prison and a $500,000 fine on the money laundering charge, and five years in prison and a $250,000 fine on the gambling charge. The indictment also seeks the forfeiture of at least approximately
$565,908,288, which represents the amount of proceeds obtained as a result of the illegal gambling and bank fraud conspiracies. The case has been assigned to U.S. District Judge Sidney H. Stein.

Rennick, 34, currently resides in Canada. Mr. Dassin praised the investigative work of the FBI and thanked the
Department of Homeland Security’s U.S. Immigration and Customs Enforcement and the Internal Revenue Service for their assistance in the investigation. Mr. Dassin added that the investigation is continuing.

Assistant U.S. Attorneys Arlo Devlin-Brown and Jonathan New are in charge of the prosecution, and Assistant U.S. Attorney Jeffrey Alberts is in charge of the forfeiture in this case.

The charges contained in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

I came across this new site the other day, and I think it’s kind of interesting. In short, Send My Chips appears to be working as an independent third party that lets you send your own money from one site to another (i.e., Full Tilt to PokerStars) without having to negotiate a trade with someone you may or may not know through a forum or some other site.

I must say, I haven’t tried this site and have no idea of how effective or trustworthy it may be. It looks like they’re facilitating money moves between major sites (Starts, Tilt, UB, Cake, to name a few), but I’m curious as to how those transfers are appearing in a user’s deposit/withdrawal history. Are they listed as P2P transfer or a deposit? Also, are these transactions being made with or without the sites’ knowledge or permission?

As a player, I think the concept is interesting and I certainly like having the ability to move money between one site and another if I wish. But, I also worry about how these transactions may look to the site operators? Is there anything here that could cause them to raise red flags and, potentially, put my account under review or possible suspension? Is the “convenience” worth the potential risk? I’m not sure I’m willing to find out.

The American Government recently froze over $30 Million belonging to online poker players, and now a payment processor is fighting back! Plus, the British betting company Betfair prepares to bring legal online gambling to the US!

Today is the first day of the 2009 main event. I’m sticking to my guns and saying the field size will be anywhere from 3,000-12,000 and offering 10:1 odds on anything outside of that. Just made a wager on the over for 5,000 … easy. Anyone else wanna offer that line? Seriously, it’s such a wild guessing game, and yet in the end, why do I think it’s gonna be just a few hundred less or just a few hundred more than last year’s main event field of 6,844? People can get their money off of PokerStars, right?

Meanwhile, Team Pokerati final tableist Gregg Merkow won his main event seat last night … and now is trying to figure out the differences between Day 1A-1D:
via Facebook

Winner winner chicken dinner won my seat to the main event in mega sat. today but can’t decide what day to play fri,sat,sun or mon.

Good question. Though as Kevin points out the numbers will likely differ noticeably as the 96 hours that constitute Day 1 progress, is there really a difference in the types of fields you can expect on each day? One more donkey-filled than another, for example (and is that a good or bad thing, lol).

Choosing when to play, of course, is the first of many decisions that will be part of someone’s journey toward becoming the winner. But it may also be the least relevant and simply depend on the player and his or her life schedule.

It seems like the payment processor crackdown may be contained — with freezing activities limited to that $33 million seized a couple weeks ago. I’m not hearing any more stories of bounced checks, and I just got an email from Full Tilt (encouraging me to activate my latest bonus) that implies all is back to normal, at least on the player’s end, or at least is not spreading:

We’ve recently reduced the minimum re-deposit (reload) amount from $50 to $30. You can deposit using a variety of payment methods, including instant eChecks – check the Cashier for full details.

(Emphasis theirs, not mine.)

Does this jibe with what everyone else is finding, at Full Tilt, Stars, UB, and elsewhere?

Are you one of the 24,000 online poker players missing their cash outs? Well the US Government has your money, and they’re laughing all the way to the bank! Get the scoop on this story, plus the state of Minnesota comes to a decision in their fight to ban internet gambling within it’s borders.

This story seems to have legs. ABC News has a piece — where they lede with a guy who so far is unable to buy into the WSOP main event. I found this story at the top of the Drudge Report … which means everyone in the mainstream media (who doesn’t read Pokerati) is also well aware of the situation. (FWIW, the ABC News story ups the number of banks targeted from four to five.)

Feds Order Banks to Freeze Millions in ‘LEGAL’ Online Poker Winnings…

Even the EU is getting involved again, threatening to take the European Commission’s discrimination claims to the WTO if they can’t reach a settlement with the US to allow their companies to compete without this sort of harassment from the US Feds. In their view, the recent actions in New York’s Southern District Court are merely a continuation of the protectionist policies that began three years ago:

“Internet gambling is a complex and delicate area, and we do not want to dictate how the U.S. should regulate its market. However, the U.S. must respect its WTO obligations,” said E.U. Trade Commissioner Catherine Ashton in a statement.

[...]

“The report comes to the conclusion that these proceedings are legally unjustified as well as discriminatory, because the activities of E.U. companies took place under the cover of U.S. WTO commitments,” the Commission said in a statement.

At a minimum, this guarantees that federal authorities (beyond a lone Assistant US Prosecutor) should be taking a real look at how “American-friendly” online poker sites process the dollars that transact in peer-to-peer poker games taking place on offshore sites before being shipped to American banks.

Word about the payment processor shizznit was definitely part of the buzz around the Rio today. We should know in about a week whether this is poker’s version of the swine flu, or if it spreads into something far more significant. Supposedly Full Tilt checks are back to clearing. However, at least one major PokerStars affiliate had his check bounce — and that’s money he lives on.

Seen in the Amazon cash game area (reading a story in the New York Post):

UPDATE: Oops, maybe swine flu wasn’t the best comparison.

Ah, once upon a time ret. Sen. Al D’Amato (R-NY) held real power … regardless, he’s still trying to wield his influence over federal actions in his home state, and the PPA statement around his statement says something about the seriousness of the payment processor account-freezing situation while confusing this quasi-legally savvy journo/not-a-lawyer on the difference between warrants and subpoenas:

PPA Statement on Southern District of NY Action Against Online Poker Players
Letter Sent to Assistant US Attorney Requesting Presence at Future Hearings

WASHINGTON, DC (June 9, 2009) – The Poker Players Alliance (PPA), the leading poker grassroots advocacy group with more than one million members nationwide, today released the following statement by PPA Chairman Alfonse D’Amato on questionable actions taken by a federal prosecutor in the Southern District of New York to freeze payment processor accounts containing more than $30 million in poker players’ deposits and payouts.

The PPA also sent a letter to the Assistant United States Attorney for the Southern District of New York asking for an opportunity to be heard in any future warrant hearings. The letter is available at www.pokerplayersalliance.org.

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