Top News of 2020 #9: The End of the Black Friday Saga (2023)

December 23, 2020

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The year 2020 will mostly be known for how COVID-19 has changed the world as we know it, but it has also seen many big events in the world of poker, including the end of the Black Friday saga.

Black FridayGuerraon the day the US federal government filed suit and shut down the three largest online poker networks in the USno PokerStars,Full Tilt Poker, Emdefinitely pokeron April 15, 2011.

A Justice Department indictment charged a total of 11 people, includingPokerStarsfounderIsai Scheinberg.

In September 2020, Scheinberg was fined $30,100 and served a prison term.Richter Lewis A. Kaplanin the Southern District of New York, making him the latest of eleven individuals charged by the United States Department of Justice (USDOJ) to stand trial in an effort to end this dark chapter in online poker.

While many poker players enjoyed Black Friday, many others turned to online poker. That day changed the online poker scene forever. With that in mind, let's recall the origins of Black Friday and its consequences.

UIEGA introduced

You could say that the Black Friday saga started with the introduction of Black Friday almost five years before it actually happened.Illegal Internet Gambling Enforcement Law(UIGEA) was passed by the US Congress in October 2006.

Among other things, the law prohibited US financial institutions, including banks and credit card companies, from sending money to online poker sites.

Many online poker rooms and networks left the US market after his death, including the then market leader partypoker. Both PokerStars and Full Tilt Poker were among the operators that continued to admit North American players, leading the duo to become market leaders, with partypoker losing much of its market share due to compliance.

Believe it or not, for many US online poker players this went on for years and there were still plenty of options to choose from. This occurred in part because theAnti-poker legislation only took effect in June 2010.

PokerStars, Full Tilt, Ultimate Bet, Absolute Poker,Bodog, and others continued to operate after that date, although payment processing required some maneuvering as most major players blocked payments to US citizens related to online gambling.

Black Friday is turning the poker world upside down

The hammer fell on April 15, 2011, a day that will forever be known in the poker community as Black Friday.

That day, the USDOJ published a 52-page indictment and civil suit against top executives of PokerStars, Full Tilt Poker and Absolute Poker, and executives of several payment processors, under the Illegal Gambling Business Act of 1955 and the UIGEA of 2006 .

Those named in the indictment face several years in prison, while the civil suit sought $3 billion in assets from the sites.

As a result, PokerStars and Full Tilt Poker immediately stopped serving US players, and Absolute Poker and its sister site, Ultimate Bet, followed shortly thereafter.

In the indictment, eleven suspects were named as follows:

“According to their allegations, these defendants engineered an elaborate criminal scheme, taking turns deceiving some US banks and bribing others to ensure the continued flow of billions in illegal gambling profits,” the Manhattan US Attorney said. .Preet Bharara. “Furthermore, we allege that the defendants have also engaged in massive money laundering and bank fraud in their zeal to circumvent gambling laws. Foreign companies that choose to do business in the United States are not free to ignore laws they don't like, simply because they can't stand the separation of their profits."

Just days after Black Friday, PokerStars and Full Tilt reached a settlement with the U.S. Attorney's Office for the Southern District of New Yorkrecover your dotcom domain namesand both went back to work. The development encouraged US residents and others to do so.withdraw their money.

The same path was opened for Absolute Poker, but they - along with their sister site Ultimate Bet - decided to open up US dot domains and offer services to players outside the United States.

As the days turned into months, it quickly became apparent that Full Tilt Poker and Absolute Poker did not have the funds to pay and close their customers.

Meanwhile, PokerStars refunded all players who requested withdrawals and quickly established itself as the leader in the online poker market, with no other site available for years to come.

Related:

PokerStars corrigiu Full Tilt

Many players were left with significant balances on Full Tilt Poker, Absolute Poker and Ultimate Bet after Black Friday and did not keep player funds in segregated accounts.

It looked like Full Tilt Poker players would eventually be saved when several people tried to buy the failed online poker room.

Ultimately, it was PokerStars' parent company in the Rational Group that took a big step forward when it acquired Full Tilt Poker's assets in July 2012 in a deal that also involved the USDOJ. PokerStars saved the day after agreeing to refund customers around the world, while also losing $731 million to the DOJ, which was responsible for reimbursing US players through a subpoena that took more than a year.

Full Tilt Pokerrelaunched a few months later as a sister site to PokerStars, allowing players to transfer funds between their accounts.

definitely pokerEmultimate pokerThe stories differed as no one bought their belongings. It looked like players had no luck getting their money back until April 2017, when the USDOJ announced a refund plan for confiscated Black Friday-related funds.

Scheinberg, the last abandonment

One by one, the eleven defendants appeared before the court. Some were fined, others were arrested.

The poker world was shocked when Full Tilt Poker became CEO in 2014Ray BitarsThe verdict only included a $40 million fine and no jail time, with Bitar claiming he had a life-threatening heart condition.

See more information:Ray Bitar pleads guilty; Sentenced to prison and retention of assets

"The Federal Bureau of Prisonscannot provide Mr. Bitar with the care he needs,” the judge said. "Prison would undoubtedly kill him." The possibility of jail time would make Bitar ineligible for a heart transplant, which would also carry a death sentence.

However, in June 2019, Scheinberg was finally arrested in Switzerland. Scheinberg initially fought extradition to the United States before finally giving up that fight. In January 2020, the 73-year-old Israeli-Canadian businessman, born in Vilnius, Lithuania,handed over to federal authoritiesin New York City on charges of operating an illegal gambling business, to which he initially pleaded not guilty. He surrendered his passport and posted $1 million bail.

Two months later, in March 2020,Scheinberg changed his plea to guiltythe only charge of operating an illegal gambling business and faced five years in prison and fines.

Finally, in September of that year, a federal judge ruled with a sentence served and a fine of $30,100.

The judge apparently disregarded Scheinberg's lawyer's contention that he deserved a lighter sentence because PokerStars corrected the devastating mistakes of its competitors, who failed to separate player funds before Black Friday when they failed to condone Scheinberg's actions. . .

“I cannot condone what you did, but the world is made up of fallible people,” the judge reportedly said. "It was a big mistake, but it shouldn't ruin what's left of your life."

Scheinberg seemed satisfied with the conclusion of the decades-long drama. he delivereda statement about itonline poker report:

I am pleased that Judge Kaplan today decided not to impose a prison sentence in my case.

PokerStars was instrumental in creating today's globally regulated online poker industry, running a fair and transparent company that has always treated its players fairly. I'm particularly proud because in 2011, when PokerStars left the US, all US players recovered immediately. In fact, PokerStars has refunded money to millions of players that other online companies owed them that those players were unable or unable to pay.

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Coincidentally, a few months after the verdict was announced,Scheinberg Inducted into the 2020 Poker Hall of Fame ClassThere he will compete against poker players like Patrik Antonius, Eli Elezra, Antonio Esfandiari, Chris Ferguson, Ted Forrest, Mike Matusow and Huck Seed, as well as the infamous director of poker Matt Savage.World Series of PokerCommentators (WSOP)Lon McEachernEmNorman Chade.

The 31 living members of the Poker Hall of Fame will vote, with one nominee being announced on December 30, 2020 as the newest member of this exclusive club.

_{The Stars Group owns a majority stake in iBus Media, the parent company of PokerNews.}

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