This week the U.S. Department of Justice seized bank accounts belonging to two processing companies – Allied Systems and Account Services. These two companies were processing payments to U.S. players for several poker sites. This is a clear violation of the UIGEA and thus the government felt it was right to sieze $33 million dollars in funds.

The mainstream media got a hold of this from a statement released by the Poker Players Alliance (PPA). This group has gone on the offensive lobbying in Washington with the claim that poker is game of skill and, thus, is not illegal. Perhaps all of this rhetoric has lulled the poker community into thinking that what they are doing is 100% legal. The playing may be in that proverbial ‘gray area’, but the moving of the money to play with is still in violation of the UIGEA.

ABC News found one player who had won a seat for the World Series of Poker. ‘David’ had a payout check bounce at his bank. ABC News quoted the player “David” as saying, “It’s not like the government went after money that the site made, instead they seized money that belonged to me.” The whole government action is being portrayed as taking the funds from players – these were “players funds” was repeated in almost every article on the subject, including the NY Times. The PPA recently posted on their site “The funds that were seized were not the property of any online site – it was YOUR MONEY that was seized.”

However, in reality the news outlets, the PPA and ‘David’ have it wrong. The money was at the processing company, it had not yet been delivered to the players. The poker rooms were not shut down, just a couple of their processors were attacked. Keep in mind, every gaming property online has multiple money processing companies.

This has happened on many occasions to sports bettors in the last few years. We have reported on several books, including large ones, who have had checks bounce on players due to government seizures or simply just shady companies going out-of-business. Since affected players never actually received any payout, we have seen every sportsbook make good on any bounced checks. Either another check is issued or another method of payment is used.

Back in June of 2008 a processor, Zip Payments, faced a similar showdown with the DOJ. This time $9 million was seized. Not a whisper in the news. You know why? The players were all compensated and though it took affected sporsbooks many months to recover, every player was paid out in full. Bodog has been a target of these seizures with several different processing companies losing over $24 million to the DOJ. Yet, all Bodog players eventually were paid out every dime.

We contacted both Full Tilt and Poker Stars who have been implicated as companies that use(d) these processors. Full Tilt did get back to us with the following comment, “We will be protecting players’ money and players do not have to worry about getting paid their funds.” There has been no reply yet from Poker Stars, but since they are a reputable company that wants to stay in business, we expect that players will also eventually get their money.

Still, poker players are up in arms. “How could they do this to us? Poker is not illegal.” And no, it may not be, game o’ skill and all that. But, certainly moving the money for the purposes of illegal gambling is. And that is what Allied Systems and Account Services were doing. Again their funds were seized, not the 27,000 players that the PPA claims.

Have poker players been lulled to sleep on what has been happening? Were they clueless to the processing problems that exist in today’s gaming environment? I can only surmise that they have followed blindly the “poker is game of skill” argument without seeing the ramifications of sending money offshore to engage in games for real money. Poker players have been led down a path now for several years where they believe that their money is safe at an online company. The truth is, the U.S. Government has been doing just about whatever it wants to online gaming companies since 2006. The DOJ and state governments have arrested CEOs, tried to ban domain names, made legitimate companies plead in retroactive cases and yes, seized funds.

Keep in mind, the U.S. Government is not the bunch of dummies that so many players think. They went after these processors during the World Series of Poker. What better time than to scare the American poker players into thinking that their money is going to be seized and big brother will come a knocking? What better time to get the most possible exposure for your act?

The most alarming thing about all of this is that the entire industry felt that this type of activity would cease during an Obama administration. Barney Frank did make a statement, but since he does not work for the DOJ, his words have little impact. As will this latest government action. The cards will continue to be dealt, poker rooms will still serve U.S. players and money will still change hands.

The government can scare players, but it cannot stop the flop or the parlay or a roll of the dice . . .