US Cracks Down on Online Poker

US authorities are indicting the owners of three of the world's biggest online poker sites, including PokerStars and Full Tilt, throwing the industry into turmoil and leading to heavy criticism from the media.

Federal prosecutors last week filed criminal and civil charges in New York that have forced foreign operators PokerStars, Full Tilt and Absolute Poker (of Canada) from doing business with Americans, in the biggest development in US online gambling law since the approval of the 2006 Unlawful Internet Gambling Enforcement Act, which outlawed the transfer of funds to online gambling sites.

The founders of the three poker rooms are among 11 people accused of alleged bank fraud, illegal gambling offenses and money laundering. Prosecutors are seeking the forfeiture of at least $3 billion in civil money laundering penalties from the three companies and their defendants, who also face possible prison time and huge fines if convicted. Five internet domain names used by the poker companies in the US were seized, and an FBI notice of the charges is what now greets players entering the three aforementioned poker rooms, in addition to Ultimate Bet.com and UB.com.

Following the shocking events of last week, online poker has found an unlikely ally in the mainstream media, with the LA Times and Time Magazine among those to lend their support to embattled poker room operators.

The Los Angeles broadsheet ran an editorial calling the indictment "the most extensive enforcement action taken" since 2006, but added: "The bigger question is whether taking down the US operations of three global websites will solve whatever problem Congress was trying to solve when it declared a prohibition on most forms of Internet gambling."

Time columnist Bill Saporito called the online gambling bust "hypocrisy doubled down," writing that the "raid on Internet poker sites in a country where gambling is legal in all 50 states, where governments are pushing their own lottery games every day, seems a bit contradictory to say the least."