US Online Poker Players Denied Their Money by Government

Online poker players seeking a court order returning their seized winnings by the US government were told by a judge the funds will remain in custody until the final disposition of the criminal case opened against the payment processor involved.

Account Services, one of the Internet payment processors involved in the seizure of bank accounts intended to pay online poker winners by federal authorities, was told by US District Judge Jeffrey Miller that its lawsuit to recover the funds became irrelevant when the money became evidence in the criminal case against company owner Douglas Rennick. Rennick was charged with money laundering and bank fraud after Account Services filed a suit saying online poker is a skill game not ruled by the Illegal Gambling Act.

The payment company, along with the Poker Players Alliance, had sought to recover the seized funds, equalling $13 million in this case, by showing the law used to justify warrants did not apply in this case. In order to invoke the Illegal Gambling Act, federal authorities must show a state gambling law has been violated, and California's laws exclude skill games from gambling.

But the criminal indictments rendered the point moot, allowing federal authorities to maintain possession of the cash until the case is resolved, a process likely to take years.

“It seems the government switched gears and they seem to have done it to specifically avoid the question of whether online gambling violates federal law,” players' attorney Marc Zwillinger told the San Diego Union-Tribune.

Attorneys for online poker players and the payment processor had suggested prosecutors had illegally seized the funds, using warrants issued after the fact and enforcing laws not pertaining to the situation.

The judge's ruling means the government can keep the poker funds shut away for years while the criminal case is pursued, and, if found in the wrong, only returns the money long after grabbing it.,

Government authorities are seeking the forfeiture of an additional $565 million they say were the proceeds of the crimes Rennick is alleged to have committed.