3 Biggest Gambling Online Has been Shutdown by U.S Goverment

Gambling online just got significantly less convenient Friday when the U.S. Government shut down the three largest Internet gambling sites operating in the United States. Now it’s time for a precedent-setting showdown, where courts will determine if this kind of gambling is legal or not.

Federal prosecutors accused the three founders of the gambling sites and eight others with illegal gambling, bank fraud and money laundering, according to the Financial Times [paywall].

The government also filed a $3 billion civil suit to recover profits from the operations, the Financial Times reported. Gambling sites Full Tilt Poker (Update: which responded to the allegations here), PokerStars and Absolute Poker allegedly disguised billions of dollars of gambling payments as online store purchases of items such as golf balls, jewelry and flowers, according to the Wall Street Journal.

If you’re in the U.S., when you point your browser to any of those three gambling sites, you see a scary thing: The U.S. government has seized the domain names of the three sites, preventing gambling transactions and anything else:

The indictment says many of the banks that processed payments for these gambling companies were unaware they were handling gambling funds, which is against a 2006 law prohibiting gambling operations from accepting payments in the United States. In addition, it says the three gambling companies found smaller, financially ailing banks to bribe, making investments in those banks that were willing to look the other way when processing gambling funds.

The problem gets a bit dicey when you realize that these three online gambling organizations are not based in the U.S. For instance, PokerStars headquarters is on the Isle of Man, a self-governed British Crown Dependency located in the Irish Sea between Great Britain and Ireland. One of our readers sent a picture of its headquarters to us today:

Will the Isle of Man or other countries where these gambling organizations are based comply with U.S. extradition requests? So far, that’s unknown.

There’s disagreement about whether online gambling is even a crime or not. Of course, the gambling organizations don’t think it should be. For example, former Senator Alphonse D’Amato of New York, who is now the chairman of a gambling group that calls itself the Poker Player’s Alliance, told The New York Times, “We are shocked at the action. Online poker is not a crime and should not be treated as such.”

Should the government be prosecuting online gambling sites? What do you think?