Black Friday: Poker

Posted by Arthur Crowson

Let’s talk about Black Friday — no, not the day after Thanksgiving where people ‘give thanks’ by getting up at 4am to save $50 on a flat screen TV.

This Black Friday is something entirely different. This Black Friday brought the largest poker sites and online casinos in the world to their knees.

Since the widespread legalization of online poker and sweeping gambling legislation many states moved to introduce during the pandemic, it’s unlikely we’ll see another ‘black friday’ quite like this — but let’s take a stroll through history.

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So, What Happened on April 15, 2011?

When players logged into their PokerStars, Full Tilt, Absolute or Ultimate Bet account, they were greeted with a message from the Department of Justice who said this domain was seized by the FBI — players quickly dubbed this day Black Friday.

department of justice poker black friday statement

No deals on this Black Friday.

Why Were Poker Domains Seized by FBI?

The government didn’t just randomly decide to close accounts and charge the main players involved — it started when the FBI arrested Daniel Tzvetkoff.

Tzvetkoff was the head of Intabill, a now defunct payment processor that helped poker sites mask deposits to look like retail store transactions (and not gambling transactions) so banks would process them.

The FBI threatened Tzvetkoff with a 75+ year prison sentenced — and he sang like a canary, outing clients like PokerStars and Full Tilt.

New York US Attorney Preet Bharara was able to create a case of using this information, starting with charging these sites with a Class A misdemeanor for running a game of chance (illegally) within New York.

Did you know? The Unlawful Internet Gambling Enforcement Act is a type of law that needs to be attached to a crime/charge. Long story short, it can’t stand alone which is the reason why Bharara started with the Class A misdemeanor.

This prompted the FBI and Department of Justice to seize the 4 domains and indict 11 people associated with the companies and related processing companies on felony charges that included money laundering, fraud, violating the UIGEA, etc. — this is just one reason it’s important to play at safe poker sites, and read online casino reviews so you can research a site’s safety & security, banking methods, and make sure they’re verified by eCogra, or a similar regulatory agency.

Why Were Poker Domains Seized by FBI?

The government didn’t just randomly decide to close accounts and charge the main players involved — it started when the FBI arrested Daniel Tzvetkoff.

Tzvetkoff was the head of Intabill, a now defunct payment processor that helped poker sites mask deposits to look like retail store transactions (and not gambling transactions) so banks would process them.

The FBI threatened Tzvetkoff with a 75+ year prison sentenced — and he sang like a canary, outing clients like PokerStars and Full Tilt.

New York US Attorney Preet Bharara was able to create a case of using this information, starting with charging these sites with a Class A misdemeanor for running a game of chance (illegally) within New York.

Did you know? The Unlawful Internet Gambling Enforcement Act is a type of law that needs to be attached to a crime/charge. Long story short, it can’t stand alone which is the reason why Bharara started with the Class A misdemeanor.

This prompted the FBI and Department of Justice to seize the 4 domains and indict 11 people associated with the companies and related processing companies on felony charges that included money laundering, fraud, violating the UIGEA, etc.

Who was Indicted on Black Friday?

The people indicted include:

  • Isai Scheinberg, founder of PokerStars
  • Paul Tate, Director of Payments for PokerStars
  • Raymond Bitar, CEO of TiltWare – software company for Full Tilt Poker
  • Nelson Burtwick, Directory of Payments TiltWare (current)- software company for Full Tilt Poker. Past Director of Payments for PokerStars
  • Scott Tom, part owner of Absolute Poker
  • Brent Beckley, Director of Payments and Risk Management at Absolute Poker (as of 2007)
  • Ryan Lang, payment processor
  • Ira Rubin, payment processor
  • Bradley Franzen, payment processor
  • Chad Elie, payment processor
  • John Campos, Vice chairman of the board and part-owner of SunFirst Bank

The Department of Justice also froze 75 banks in 14 countries and PokerStars and Friends were forced to close up shop to US customers, which accounted for as much as 40% of their business. And that was just on Day 1.

What Happened After Black Friday?

The months – years, in some cases – were interesting, to say the least. It was business as usual for PokerStars. They cashed out American players within the first couple of weeks following their indictment. And they were the only ones.

A couple of months after the indictment, the parent company to Ultimate Bet and Absolute Poker, Blanca Gaming, released a statement saying they were going to file bankruptcy, and a days later they laid off their pros representatives.

Full Tilt Poker said in a statement there wasn’t a legal payment channel for them to use for cash outs, and that they had no accounting of the millions taken by the DOJ.

This didn’t go over well with players …or the US Government. It sparked multiple investigations that led the Alderney Gambling Control Commission to suspend their license on June 29th, 2011. No one was able to play on FTP after that.

Then news broke that Full Tilt was seeking investors so they could pay back players (as much as $150 million).

Shortly after more news broke saying the US Government was claiming Full Tilt was a ponzi scheme because several members of the company (including Chris Ferguson and Howard Lederer) received hundreds of millions – more than $440 million – since 2007. MORE than enough to pay players back.

This turned into an ordeal outside of the Black Friday indictments. Both Howard Lederer and Chris Fergus had civil suits to deal with that resulted in them giving up millions in profit sharing revenue, properties, vehicles and bank accounts. They both managed to avoid jail sentences, and Isai Scheinberg did initially as well — in 2020, Scheinberg surrendered to New York authorities, and pled not guilty to his charge of operating an illegal gambling business.

On 12/20/2011, Absolute Poker co-founder Brent Buckly pled guilty to misleading banks, setting himself up for a 12-18 month prison sentence. He ultimately was sentenced to 14 months.

Ira Rubin entered a plea agreement, pleading guilty to 3 of 9 counts of conspiracy to commit bank fraud. He’s expected to serve 18-24 months.

John Campos was hit with a single misdemeanor and Chad Elie pled guilty to conspiring to commit bank fraud and for operating an illegal gambling business.

In April 2013, Ray Bitar reached a deal to plead guilty to criminal charges. He was sentenced to time served and was ordered to give up his assets which included various homes and $40 million. Bitar received a light sentence since he’s a Class IV heart transplant candidate — he was facing 65 years in prison.

Arthur Crowson

Arthur Crowson writes for GambleOnline.co about the gambling industry. His experience ranges from crypto and technology to sports, casinos, and poker. He went to Douglas College and started his journalism career at the Merritt Herald as a general beat reporter covering news, sports and community. Arthur lives in Hawaii and is passionate about writing, editing, and photography.

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