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Update on 2nd Round of FBI Seizures

Posted on June 10, 2011 by mosesbet

The online poker industry suffered a huge blow on April 15th when 4 of the internet’s larges US poker sites had their domains seized by the FBI.  In addition to the seizure, 11 individuals and owners of the poker operators (PokerStars, Full Tilt Poker and UB/AB) were indicted by the Department of Justice over allegations of laundering money.

6 weeks after the “Black Friday” happening however, ten more gambling operators were shut down by the US government.  These were far more substantial in scale and included many US facing rooms such as Doyles Room, TruePoker.com, BetEd.com, Bookmaker.com, BetCris.com and others.

Many US facing operators decided not to take the risk and voluntarily closed their sites to US players.  On May 1st 2011, Sportsbook.com (one of the biggest US sportsbooks in the country having serviced players since 1996) release a statement to their affiliate and players saying they would no longer be accepting new US players and to stop sending them traffic.

On the poker side of things, quite a lot has changed too!  Although many recreational poker players can take solace knowing that they have finally been able to withdraw their funds from PokerStars, Full Tilt Poker and (wait for it!) UB.com, they still have a massive lack of options when it comes to play poker online.

How the Industry has Changed for US Poker Players

If you do a quick search for some of the biggest affiliate sites such as PokerListings.com, PokerNews.com and OnlineGamblingSites.net (check out their poker gambling sites here) you’ll see that the rooms they promote are completely different to before.  This is because most of the biggest former US-friendly rooms have now shut down or stopped accepting US players, which has shifted their focus towards UK and European Rooms.

Victory Poker CEO Dan Fleyshman decided to shut down the Victory Poker network following news of the first round of US poker room indictments. Instead, Victory Poker will now become an affiliate site and their previous player traffic has been moved to the US-friendly Cake Poker Network.

UB.com and Absolute Poker are probably a sunken ship, unlikely to return to the peak of the industry again.  The Cereus poker network (formerly 3rd largest US-friendly network) suffered the worst out of all the sites and their traffic dropped up to 70%.  The lack of notice give to players about when they could withdraw their funds also reduced their popularity among European players, and their company is in such bad shape right now that they fired 99% of their employees.

The poker affiliate community has also had its victims of the “Black Friday” fiasco.  The CEO of Protos Marketing, which owns some of the biggest poker affiliate sites such as PocketFives.com, PokerSource.com, TightPoker.com, PokerBonuses.com and PokerNewsDaily.com has decided to cut their losses and sell off PokerNewsDaily.com and PokerTerms.com on eBay for a $100k and $15k BIN respectively.

Conclusion on the US Blackout

The most worrying concern for gambling operators is that the Department of Justice seems to have spread their pursuit of indictments to include software developers in addition to payment processors, operators and the owners.  David Parchamchuck, the owner of a software development company which worked for BetEd.com was arrested by the FBI last week, even though he had virtually zero connections to the transfer of payments or money laundering.

In the face of the surge of attacks on the US gambling operators, many casinos and sportsbooks have also decided to shut down their operations or move their entire sites and companies overseas with .eu or co.uk domains.

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