Seized Online Poker Funds Distributed to Police Department in Maryland

June 11, 2011

Last week it was reported that the Anne Arundel County Police Department in Maryland, USA received more than $470K worth of seized funds that were the result of a federal investigation on Internet gambling. Now poker players around the world are questioning this news.

On June 2nd it was reported that a fraction of the money confiscated by the US Department of Homeland Security’s International Customs Enforcement (ICE) division was given to Anne Arundel County. ICE seized more than $30 million in payment transactions between December of 2009 and January of 2011 when they set up a faux processing company. The story generated opposition from people across the globe who thought the distribution of the money by the government was wrong. In the eyes of online poker players and gamblers, this seizure and distribution was mere theft.

Bill Sutton, restaurant manager in Edgewater, lost $1,000 when the poker site he played at, Full Tilt Poker, was shut down by the feds. He said, “What upset me so much was the seizure of those funds and it not being facilitated to get the funds back to the players.”

Full Tilt Poker’s seizure, along with Sutton’s cash, was separate from the funds that were distributed to Anne Arundel County, but he is still angered by law enforcement officials who appear to have no intention of refunding players money.
Sutton said, “I understand it was a big score for them, and it was a lot of work for them to do it. The thing that upset me the most was that they are taking funds from players when it has not been deemed illegal.”

Furthermore, Baltimore’s US Attorney’s Office says it has no intentions of returning the money to the players.

Spokeswoman for Maryland’s US Attorney’s Office Vickie E. LeDuc says, “Illegal gambling proceeds are forfeited to the government. Anyone who believes that an Internet gambling business owes them money can try to collect from the Internet gambling business. The government is not going to give the money to gamblers.”

According to legal experts, the distribution of the seized money in not unprecedented, but it is unusual for a local department to hold a press conference with a photo op.

Frequent legal consultant for gambling issues and business law professor at SUNY College at Buffalo, Joe Kelly, says, “I think this unusual. I’m not saying it hasn’t been done, but this is the first time I’ve seen it done with this type of publicity.”

A federal grand jury in Baltimore back in April indicted three defendants and two business for online gambling, and in May, ICE seized 10 domain names and 11 bank accounts relating to online gambling charges in what appears to be a national attack on Internet gambling institutions that started with Black Friday when the three biggest online gambling operations, PokerStars, Full Tilt Poker, and Absolute Poker, were shut down by the US Department of Justice. Charges of illegal gambling, bank fraud, and money laundering were also involved. Most affected US poker players are now without their money and have reportedly lost their only source of income.

Sutton, who once had funds on as many as 15 different poker sites, said, “I know a lot of people that do play for a living. A lot of them are my mentors, and they’ve lost their livelihood.” After the 2006 Unlawful Internet Gambling Enforcement Act (UIGEA), he shaved down his online assets.

The UIGEA has been the main vehicle for the recent shutdowns of online gambling operators, though there is still much debate among gamblers and law enforcement agencies regarding what types of gambling is legal and what types are illegal.
Federal law makes it illegal to process online gambling payments via US financial institutions, explicitly banning online sports betting. However, many online gambling supporters believe that poker is a game of skill rather than luck and should not be categorized with games of chance and sports bets.

“With poker, you’re not playing against the house, you’re playing against other people,” said Sutton. “Yes, there is some luck involved, but it’s an odds thing. If you play when the odds are in your favorite during a particular hand, you’re going to win more than you lose.”

Sutton claims his first $50 deposit at an online poker website was made five or six years ago and ever since, he had done well enough that he hasn’t deposited any personal funds since.

He said, “I’ve been able to purchase some nice things. There have been thousands of dollars that I’ve been able to pull out as a fun hobby.”

Online poker is treated differently in each state. Some states have sided with the player, and rarely are the players themselves targeted by law enforcement. In fact, Washington state is the only state that deems online poker explicitly illegal. Maryland also has unfavorable laws against it as well.

“When you look at everything, it doesn’t look good for poker in Maryland. I’d much rather defend poker players in New York, South Carolina or a number of other states than Maryland,” commented attorney Kelly.


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