Scott & Mike MatusowIf you are a regular listener of my show, you know I warned people 6 months ago not to leave too much money on the sites. for 3 years prior, I told people that this was only a matter of “when” not “if”
I knew this was coming based on my talk with a Lawyer connected to The DOJ. To be clear, Mike Matusow DID NOT have any PRIOR first hand knowledge this would occur. In fact, he used to call me “nuts: when I was telling him as well!

So what can we expect now?

First off, in spite of what FTP and PS says, this does effect players beyond The USA. 76 Bank accounts have been frozen/seized by The Feds in 14 countries world wide. Many of the accounts seized were not only the payment processors for The USA, but for many other countries.. Please read THE FULL 52 PAGE INDICTMENT HERE . More international subpoenas are currently in the process of being executed. Many people simply have not read the entire indictment, and beleive this only effects USA players.

Simply put, these sites cannot meet any cash out demands because these assets, along with more assets, are frozen and will be frozen. I expect legit payment processors to ” run for cover” and distance themselves from FTP and PS. Now FTP issued a statement claiming they beleive online poker is legal, as do ” some of the best legal minds in The USA”.. Well, SO DO I!! but this is not about online poker in and of itself, but offshore sites engaging in alleged money laundering and fraud, in order to CIRCUMVENT THE UIEGA, tricking banks to process these payments, when The UIEGA clearly states it is illegal for them to do so, WILLINGLY, KNOWLINGLY!



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In my opinion, the only chance FTP and PS has to beat this case, is for their attorneys to argue that the UIEGA in and of itself is unconstitutional. The Federal Reserve is supposed to be the oversite with jurisdiction. How can a privately held institution like The Fed have this kind of authority? Also, it appears to be a violation of “equal protection under the law” Article 9, I beleive. Why were some Sports betting and horse racing sites in The USA and abroad allowed to have their payment processors process these bets, wheras online Poker sites were not? Having said all of this, it is likely you will not see your money ever again. It will be seized by The USA GOV, just like they seize alleged Drug dealers money and possesions. I also beleive The USA will claim that the very servers themselves the sites use to run the games, were built and maintained from “illegal and illicit gains”, therefore they will seize those servers with the aid of foreign countries where the servers reside, and effectively shut down FTP and PS indefinetly world wide. This is the classic DOJ play book tactics I describe above. They handled the Warez busts in 2003 in the same manner. They will seize as much as they basically WANT TO SEIZE and freeze, and foreign Governments almost always go along with The USA, not wanting to “piss off The USA”

I have more to say in the coming days over this issue so stay tuned!

Scott

There is good news for poker players in the Unites States. Our poker room remains open for all players. This is one of very few online poker sites that can still be played & will always be legal to play for US players. All banks will accept payments from the poker room. It easy and takes a couple of minutes to register. For full details simply go to Make Poker Legal Poker Room

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7 Responses to “Online poker busts; what we can expect to come next”

  1. realitybytes says:

    http://www.businessinsider.com/online-poker-players-get-their-money-back-2011-4

    read the above article it is a much more unbiased look on the matter, also as stated on your previous post comparisons to drugs and now extended to warez simply is not valid FTP and Stars are located in countries that have good business laws and will protect them, and their legal practices. The neteller comparison is a much better angle to look at this from. Spreading comparisons to drugs and warez does not help, it will simply fuel propaganda, and make people on the fence think it is a good move to not legaliize poker in the states. Having read over the indictment document and seeing how much money is involved payment processors will never turn their back on that money, FTP and Stars are not small companies they generate and will still continue to generate vast ammounts of money.

  2. ScottMatusow says:

    no matter what u think, the DOJ will do whatever they can to secure a freeze of up to 3 billion in assets of these sites.. its moot if these sites operate legally in those other countries. is it right for The DOJ do it? nope, but they will, and those other countries will not get in the way… now let’s see if I am right, because i correctly predicted this 2 years ago.. its not a bias. it is an opinion. this is a blog, i am not a news reporter.

  3. realitybytes says:

    The DOJ has to follow the laws of land where the company is formed, Isle of Man and Ireland are not push over countries that will not protect them. The DOJ can apply for extradition they can and have put through process of freezing accounts, but they will all be appealed and or those involved will voluntarily hand themselves over. There is no dispute that crimes have been committed, and no question in my mind that those involved will be found guilty either by court ruling or plea and bargain pleas. That does not change the fact that these businesses operate within legal practices, and the DOJ has no juristriction over the running and or influence of those businesses. Isle of Man is renowned for their business laws, they will not change laws and jeopardize their infrastructure nor will they give in to demands that are outside of their laws. Please show me references that the DOJ has successfully managed to perform the actions you speak of in either Isle of Man and or Ireland. They simply cannot do it it is out of their control.

  4. realitybytes says:

    Just to add, for the Isle of Man these appeals can be escalated to British courts, and then the European courts if wanted/needed. For Ireland they can be escalated to European courts, either way they will be dealt with by courts whom have an inveted interest in ensuring these companies remain in operation although I doubt the appeals need to be taken out of the Isle of Man and Ireland.

  5. realitybytes says:

    Hey Scott, last post on this now :D , come on you know you will miss me.

    Anyway stumbled upon this which I think sums up my points exactly and I am hoping as the author is a professor you will give it some credability.

    http://www.gamblingandthelaw.com/blog/299-federal-poker-indictments-revisiting-prohibition.html

    Seriously though take a look at your stance on some of these items and the things you have suggested, US DOJ and law cannot dictate outside of the US, and nor will any British or EU based country “follow suit” it is simply a biased instilled opinion of many US citizens that their law is world wide but it most definatually is not, especialy when it comes to legally operated businesses within other countries and Isle of Man was a perfect location for Stars to setup as US DOJ does not stand a chance against them. Also the $3 Billion you claim the DOJ will want to ensure they get, is nothing to Full Tilt and Stars, how much do you suppose those companies are worth?

    Stars is still boasting 90k users and Tilt 50k, the arguement of payment processors pulling the plug does not stand, if this has shown anything it has proved that money is everything, look at the allegations, they took part ownership of US banks to process payments, you honestly think they will run in to problems with processors in countries where they operate legally?

    Lets face it the US market is probably the single most valuable market but after 2006 it has never been the same, I can draw from my own profits and see a clear decline, majority of my biggest earnings are EU based, and the ROW comprises of a considerable portion of income.

    Anyway back to the points you raised that these companies cannot meet demands for cashouts, this is not true, while they will no doubt halt some payments to US cashouts as it is undertmined right now of their legal stance and actions and if the DOJ will handle the money by returning it to people through what has been seized and if it remains seized, I find it unlikely they will continue to hold anything that is outside of the US though. The simple fact is even if the sezures do cause financial problems for them they are still multi billion dollar companies who are still generating insane ammounts of money, lets just suppose they are in financial trouble they will have no problems finding investment, based on projected income. If they can pursuade banks to operate illegally in the US, they again will have no problems within countries where they are legal.

    Anyway I am out I hope you will take a look at some of your opinions and hopefuly change your attitude to this elitist US ethos that US is global law it simply is not true, and as the events unfold I am 100% certain you will proved wrong.

    “now let’s see if I am right, because i correctly predicted this 2 years ago” I correctly picked the winner of the Grand National, does that qualify me as a horse racing pundit? Making the assumption that processing US payments was going bust was obvious is was law, it holds no bearing on making predictions about other laws you appear to no nothing about!

  6. ScottMatusow says:

    and i have actually changed my view the last 24 hours after talking to my brother. i never said us is global law, and i am familiar with a lot of the laws you refer to. my opinion was based on USA imperialistc past behavior. the war in Iraq was not legal, and we engaged it anyways. The USA has a history of acting in an illegal manner, and other countries have a history of going along with The USA regardless. That was my main point. so please calm your tone on your last line. your assumption is totally wrong.

  7. realitybytes says:

    Not to side track but the politics of war is something entirely different, US and UK have their own interests for the iraq war, we are agreed on the legality issues. This is not war though and comparisons cannot be made.

    I am glad you have altered your views, no out of tone was meant difficult to portray through text. In all fairness you seem a stand up guy, I have read over a few of your blog posts, find them an interesting read. I was just tired of coming across what appeared to be plenty of heated rants that seemed to portray events out of context, with no solid basis other than hysteria of what has gone on, which the DOJ intended, playing right into their hands. Tilt and Stars are legal companies where they operate, they would if they could play ball within the US, they have made good with many countries which has cost them severe taxes which they could have simply avoided in the same mannor, but they did not because they want to operate within the laws.

    Anyway I wish you success, will drop by your posts from time to time. Been good debating with you!

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