The founders of the three largest online poker sites were indicted by the FBI on Friday in what could serve as a death blow to the thriving industry.
Eleven executives at PokerStars, Full Tilt Poker and Absolute Poker were charged with bank fraud and money laundering in an indictment unsealed in a Manhattan court. Two of the executives were arrested on Friday morning in Utah and Nevada. Federal agents are searching for the others.
Prosecutors are seeking to immediately shut down the sites and to eventually send the executives to jail and to recover $3 billion from the companies. By Friday afternoon Full Tilt Poker’s site displayed a message explaining that “this domain name has been seized by the F.B.I. pursuant to an Arrest Warrant.”
The online gambling industry has taken off over the last decade, drawing an estimated 15 million Americans to bet online.
In 2006 Congress passed a law prohibiting online gambling. Most of the leading sites found ways to work around the law using foreign banks, but prosecutors allege that in doing so they broke the law.
“These defendants concocted an elaborate criminal fraud scheme, alternately tricking some U.S. banks and effectively bribing others to assure the continued flow of billions in illegal gambling profits,” Preet Bharara, the U.S. attorney in Manhattan, said in a statement.
Poker fans took to Twitter in droves, worried about the money in their online gaming accounts, fretting that online poker’s days were at an end.
[featured]Red Kings, Title Block, Does NOT accept american players!.[/featured]