Shortly after last week’s announcement that the  U.S. Attorney in New York had managed to take down the three largest  U.S.-facing poker sites on the Internet, the day was dubbed ‘Black Friday’ by poker players and operators alike. Within a matter of days, the affected websites issued updates to  U.S. players who were up in arms about their rights being violated and more importantly, their funds being frozen. Players’ minds were set at ease a bit by the announcement that funds would be returned. But now the lingering question is when?  When will PokerStars and Full Tilt pay back their players?

The two biggest government cases that involved player funds happened within 6 months of each other. First BETonSPORTS was taken down by the DoJ in July of 2006, then in January of 2007 payment processing giant (at the time) NeTeller was indicted by the feds. These two cases literally went in opposite directions. BETonSPORTS players are still waiting for a refund, while NeTeller did sort out their mess and got funds back to players later that same year. The situation with these poker rooms looks like it will mirror, in some form, the NeTeller resolution. We do not forsee a BETonSPORTS situation here as all of the affected poker companies operate globally, like NeTeller, while BOS had over 90% of their players in the  U.S., and went bankrupt within weeks of thier indictment.

While tens of thousands of players had funds at NeTeller it took the company nearly a month to issue a statement regarding payback. “As a result of the restrictions placed by third parties, court-ordered seizures, and related legal concerns, the group is currently unable to make payments to US customers.” PokerStars and Full Tilt only took a couple of days to come to an agreement with the DoJ to return funds to players. On Wednesday they realeased the following in a statement, “PokerStars has reached an agreement with the US Department of Justice that will allow players to cash out as soon as a suitable processor is found.”

The problem here is that right now these poker rooms, no matter how much they want to get funds back to players, simply can’t. The DoJ shut down their money processors and now they most assuredly will have to get ‘permission’ from the DoJ on who to use, and how to get the funds repaid. In February 2007, NeTeller said, “As a result of the restrictions placed by third parties, court-ordered seizures and related legal concerns, (Neteller) is unable to make payments to U.S. customers”. This is the same scenario that poker players will face in the coming weeks with PokerStars, Full Tilt and hopefully, Absolute Poker/Ultimate Bet.

The NeTeller case seemed to drag on forever and it was a lengthy process, but in July of 2007, six months after the indictments and account seizures, NeTeller agreed to forfeit $136 million and admit wrongdoing for violating U.S. laws. Later that month NeTeller announced that it had come to a ‘Distribution Agreement’ with the DoJ and on July 30 stated, “US customers will be able to access their NeTeller accounts online until 26 January 2008 and make a request for their funds.”

This process took six and a half months. And, it was not until after NeTeller admitted wrongdoing and PAID that they were able to send funds to US players. The DoJ accepted millions from Neteller and its founders but they are seeking $3 billion from the poker companies. 

The poker companies will most likely have to go through a similar dance with the  U.S. Attorneys. Basically these sites will have to plead guilty before the DoJ is going to let them refund players. More pain for the players who use offshore sites is certainly a nice by-product of the arrests for a government that does not want you playing anyway.  The DoJ does not care that players are out money. Testimony by the DoJ in Congress has stated that Internet gambling is illegal as far as they are concerned. Thus, all of the affected players were gambling illegally in their eyes and their funds are deemed illegal proceeds. So far, all of the affected poker companies have proclaimed their innocence. And, as of this writing Absolute/UB had not come to any agreement with the US Attorney. They stated today, “Given the far-reaching consequences of the US Attorney’s actions for Absolute Poker and for the entire poker community, Absolute Poker believes that the responsible course of action is to review with its attorneys the relevant court filings before taking any action.”

Now, NeTeller did refund players’ money and once the agreement with the  U.S. was in place, it did happen rather quickly. However there are three different companies all in the same boat here. Most likely we will see three different scenarios for players getting refunds with the potential for varying times that payouts will be available from each company. Though we are highly confident that players at PokerStars, Full Tilt and Absolute Poker/Ultimate bet will get all of their money back out of these operations, we doubt that the statement from Poker Stars will come to fruition, “Cashouts for US residents are expected to be available within several weeks.” Perhaps they should amend that statement to say several months.

Players are urged to hang in there as the funds are expected to be paid back and follow both the sites they play at and the OSGA BLOG for updated information on payments as they unfold.