Update: More Reactions To Federal Indictments

Experts, opponents and advocates of online poker issue statements It seems that the current situation with online poker in the US touches everyone, with a number of new reactions to the federal indictments against major online poker companies and their processors being issued by experts, opponents and advocates of online poker in the lucrative US market. According to the senior Democrat on the US House Financial Services Committee, Barney Frank, this move represents "an incredible waste of resources," adding that the seizures conducted in the action protect "the public from the scourge of inside straights." He added: "Go after the people responsible for empty houses, not full houses. I'm not saying violate the law, but to give this priority in law enforcement over some other things I think is a terrible idea and I think the administration is wrong on this." In regards to the crackdown, it may have affected more than just the indicted sites – with around $16 billion spent by U.S. players on Full Tilt Poker, PokerStars and Absolute Poker last year, the initiative's casualties include casual and professional players and their backers, programmers and investors. As a result, the ESPN television sports channel, which is owned by Walt Disney Co., has announced that it is removing poker advertising and programming: “We are aware of the indictment only through what has been announced publicly. For the immediate future, we are making efforts to remove related advertising and programming pending further review.” As for the state of Nevada, where Pokerstars has been prominent in pushing for legalized intrastate legislation, there have been calls to investigate the political funding invested by the company in the amount of around $272 000. This is due to the fact, claimed the State Senator Greg Brower, a Republican and a former US Attorney for Nevada, that contributions by foreign entities to federal, state and even municipal political campaigns are not permitted by federal law. Some of the 68 recipients of the funds (politicians seeking election to the state legislature, constitutional officers of the state and political parties and action committees) allegedly include secretary of state Miller, who denied the claims, Assembly Speaker John Oceguera ($10 000), Nevada governor Brian Sandoval ($10 000) and his rival for the post Rory Reid ($10 000). As for one of the first indictees to appear before the Utah federal court, a vice chairman and part owner of SunFirst Bank John Campos (57), charged with violating the UIGEA, operating an illegal gambling business and money laundering, he was released by Magistrate Judge Robert T Braithwaite on condition that he surrender his passport, report to pre-trial services as requested and appear at future hearings in New York, where the indictment was filed. According to a reputable US gambling law expert, Professor I. Nelson Rose, the timing for the indictments is very suspicious, having in mind the positive moves towards state and federal regulation. He said that interrupting the process may have been the goal, adding that the prosecutors have the problem of convincing a jury that there is bank fraud when the "victims" are tricked into making millions of dollars. In his article "Federal Poker Indictments: Revisiting Prohibition" Prof Rose opines: “Prohibition created modern organized crime, by outlawing alcoholic beverages. When people want something and it is illegal, organizations will arise to fill the demand. How much more so when the activity, online poker, is not even clearly illegal?" He also states: "The DoJ has been waging a war of intimidation against Internet gambling for years, successfully scaring players, operators, payment processors and affiliates into abandoning the American market.” "Lacking the two essentials to any prosecution – a statute that clearly makes the activity illegal and a defendant physically present in the U.S. – the feds have announced showy legal action against easy targets about every other year. "Online poker is not an easy target, since a federal Court of Appeal ruled the Wire Act is limited to bets on sports events. And tricking financial institutions into processing poker payments seems a technicality, especially since the banks made millions without paying a penny in fines." Considering the future fall-out from the federal action, the professor doubts that it will deter poker players, but notes that there are many famous American poker players and others who are associated with the indicted operators who could experience some of the fall out. Another comment arrived this week from the Antiguan Minister for Finance and the Economy, the Honourable Harold Lovell, who stated that the federal action is "...the latest effort by the American authorities to shut off competition in remote gaming in violation of International law." He also added: “I am concerned that at this point in time United States authorities continue to prosecute non-domestic suppliers of remote gaming services in clear contravention of International law. "I am not aware of any other situation where a member of the World Trade Organisation has subjected persons to criminal prosecution under circumstances where the WTO has expressly ruled that to do so is in breach of an International treaty.” In addition, Antigua's legal counsel in its dispute with the US at the WTO, Mark Mendel, commented: “The WTO ruled that these kinds of laws criminalizing the provision of remote gaming services are contrary to the obligations of the United States under the WTO agreements. "The United States, being a very heavy user of the WTO rules to its own benefit, simply cannot continue to prosecute persons for engaging in legitimate International commerce.” “What the United States has attempted to cloak as a moral issue is now clearly nothing but economic protectionism at its worst. "Rather than engaging with Antigua and the world gaming community to reach a reasonable accommodation on this relatively new but now globalised form of economic commerce, the United States has instead determined to protect its domestic gaming interests regardless of International legal obligations. "This is very hard to reconcile not only with its pronouncements regarding the imperative of other countries to strictly observe their WTO trade obligations but also with stated official United States government policy of adherence to the rule of law.” “Given the time that has been spent by the Antiguan government on sincere attempts to negotiate a reasonable settlement with the United States, and the very meagre results that have come of those discussions, it might be time for Antigua to go back to the WTO and compel American compliance with the rulings that this very small country fought so hard for and deserves to see implemented.” According to the Antiguan government's statement, "Last weeks' indictments and other recent developments would seem to indicate that the United States is still unwilling or unable to tackle the issue of offshore remote gaming services in a mature and legally compliant fashion. It was concluded: “At this time we are examining all of the options we have against the United States as a result of the WTO decision. We are confident that the WTO rulings have significant strength and we are now looking into ways to capitalise on that in order to achieve our objectives.”