Posts Tagged ‘money laundering’

Popular Online Poker Currency Bitcoin watched by US Govt.

Sunday, March 24th, 2013

Bitcoin (a.k.a. bitcoins) has become a very popular currency in the online poker world. Bitcoin isn’t backed by a central bank or country, and it can be sent across the internet anonymously through “wallets.” This allows poker players to easily make deposits and withdrawals from poker rooms without worrying about huge delays and hassles.

Unfortunately, it looks like the ease of use aspect could be gone because the US government has been focusing on bitcoins. Furthermore, the American government has applied money laundering laws to virtual currency in a move designed to target Bitcoin.

The Wall Street Journal discussed the money laundering laws by writing, “online cash will now be regulated in a similar manner as traditional money-order providers such as Western Union. They would have new bookkeeping requirements and mandatory reporting for transactions of more than $10,000.”

At first, this may seem like another selfish move by the US government to hurt the online poker industry since they’re not drawing tax revenue from it. However, applying money laundering laws to Bitcoin and other virtual currencies is more about eliminating drug-based crimes. The WSJ discussed both the legal and illegal side of bitcoins with the following:

Bitcoins can be used in a host of legitimate transactions—for example, website Reddit allows users to upgrade services using bitcoins and blog service’s store accepts them as a form of payment. also lets bitcoin savers pay for deliveries through Domino’s and other pizzerias.

On the other hand, at least one online service takes bitcoins as payment for illegal drugs, according to a Federal Bureau of Investigation report last year. Bitcoin’s backers point out that criminals will use any currency for money laundering or illegal purchases.

After the new stipulations placed on virtual currencies, the value of bitcoins has already fallen from $60 a unit to $49. Of course, this doesn’t mean that the currency will suddenly become obsolete. However, its use among US online poker players may drop significantly. Seeing as how many US-friendly poker sites are relegated to paper checks, which can take weeks to process/send, this definitely isn’t good for the game.

Real Reason for PokerStars, Full Tilt Crackdown

Tuesday, April 19th, 2011

Last Friday marked a dark and tragic time for most US poker players because it seems like everybody has/had a PokerStars or Full Tilt account when the US Department of Justice decided to shut the sites down. Immediately, people pointed the blame at the US government and cried that our liberties and freedoms were being taken away. And while there’s nothing democratic about telling limiting the options people have for playing online poker, people can’t blame the entire thing on the American government.

Plenty of this blame can be directed at the actual sites themselves because Stars and Full Tilt were certainly not innocent in the whole matter. Sure there were difficulties in both receiving and getting payments to players; however, bribing banks, working with David Tzetkoff to develop shell companies, and disguising transactions as golf balls, jewelry, etc. was not the way to do it.

Furthermore, those in charge at these companies were irresponsible in taking such measures because they have to worry about their clients’ money as well. Obvious bank fraud and money laundering activities are not the way to keep your players’ money safe by any means. Luckily, the DOJ was not the monsters that people initially portrayed them to be since both FT and Stars were able to re-open their .com names to let players cash out. The whole thing wreaks of an above-the-law attitude by both sites.

Now this isn’t a pro-government rant either because PokerStars and Full Tilt shouldn’t have to go to such measures to take deposits. The UIGEA is a half-assed, idiotic law that was supposed to dissuade online poker sites from offering services to American citizens, when all it really acts as is a nuisance.  The US should have regulated online poker a long time ago to get taxable revenue instead of wasting money to implement measures that reject an extra source of tax revenue. Hopefully that regulation is coming soon.