There have been rumors lately that the Department of Justice was looking to crack down on payment processors of some of the major online poker sites. It has now been confirmed that the DoJ has issued an order that the accounts of several payment processors from four banks to be frozen and the cash seized.
Poker players were having some trouble recently when checks they were getting from some Internet poker sites, specifically Full Tilt Poker and PokerStars, began bouncing. It was later revealed that a letter had been sent to four banks, including Wells Fargo in San Fransisco, Citibank, and two other banks, demanding that they freeze the accounts of payment processors Account Services and Allied Systems. The letter was signed by the Assistant U.S. Attorney for the Southern District of New York, Arlo Devlin-Brown. He states that the funds were frozen “because they constitute property involved in money laundering transactions and illegal gambling offenses.” Later in the day, the banks received another letter informing them to consider the funds “legally seized” by the FBI.
The Poker Players Alliance contacted all of the parties involved and issued a statement on the issue. In it they state that they are “disappointed that this unprecedented action has been commenced against law abiding poker players.” They also ask that the Southern District of New York immediately release the funds to the players. In addition, they state that they are “coordinating a legal strategy to appropriately protect PPA members who are impacted by the Southern District’s actions.”
The PPA does state that they have contacted the poker sites affected by this and that the sites have stated that customers will receive all money due to them.
This step by the Department of Justice is quite an unprecedented move. In the same letter issued by the PPA, they state, “We are also concerned that the Southern District has selectively taken action against online poker when the current law regarding the activity is far from clear, and policies from various levels of government are inconsistent at best. In fact, no federal or state court has ever found a payment processor or a players accessing an Internet poker site to have violated the federal laws alleged by the Southern District in this case.”
There will undoubtedly be much more information on this situation throughout the coming days and weeks. This action affects us all as poker players, obviously more so for American players. It will be interesting to see if lawmakers, such as Barney Frank, have any input on the situation and if it will help to push forward the process of bringing about the regulation of online poker. Either way it is an unfortunate setback for online poker that we will all be watching very closely.