Case Against Online Poker Payment Processor Closed

August 20, 2010

Last year’s US court case regarding Ahmad Khawaja, online payment processor, is finally over after the FBI confiscated more than $13 million from Allied Systems and Allied Wallet, two payment processors involved in online poker transactions with the world’s biggest online poker site, PokerStars.

The FBI claims that funds were seized after violations of the UIGEA was violated, though the confiscated amount is only a fraction of the total value of cash that what was actually transferred back and forth via the two processors during 2009.

The investigation that ultimately brought down the companies involved specifically eight bank accounts that were allegedly in direct conflict with orders set forth by the UIGEA. In defense of the accused, it was argued that the UIGEA was convoluted and in fact permitted such transactions to be made legally. Unfortunately though, however such transactions may be “hidden” in writing, efforts to slip them under the radar were not effective in these cases.

A statement made by PokerStars follows:

“PokerStars does not condone efforts by processors to conceal the nature or purpose of funds used to play online poker. PokerStars has taken steps to ensure that processors properly disclose the nature of their business to their relevant financial institutions.”

Attacking the payment processors that facilitate online poker transfers is the only way for the feds to enforce the UIGEA, as there is no actual criminal activity taking place. The UIGEA is in fact convoluted and while it hasn’t done much to stop or even deter the existence and progression of online poker, and gambling in general for that matter in the US, it does point fingers at the financial institutions that facilitate online gambling between players and the gambling sites.


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