Preet Bharara, the United States Attorney for the Southern District of New York, announced that Raymond Bitar, the former chief executive officer of Full Tilt Poker, pled guilty today to unlawful. Full Tilt Poker Hearing Underway: Three Possible Outcomes Ahead. Before deciding on the fate of Full Tilt’s licence. In any case, considering the number of court cases currently facing Full. On Friday April 15, 2011, DOJ indicted 11 individuals associated with the three largest companies offering online poker games to U.S. Residents—Absolute Poker, Full Tilt Poker, and PokerStars. The indictment charged the defendants with conspiracy to commit bank and wire fraud, money laundering, and illegal gambling offenses.
ByA decade ago, Peter Jepsen was an EPT champion, an admired high-stakes online poker pro, and even a sponsored pro at various times with Betfair, Ladbrokes, and Full Tilt Poker.
The Danish poker pro was a part of the wave of Scandinavian players (Scandis) who were dominating the game during the poker boom. Jepsen was one that almost seamlessly transferred his online poker skills to the live tournament tables.
Everything changed in 2014, however, when he was charged with cheating via poker software that allowed him to see other players’ computer screens. The Danish Economic Crime Department charged Jepsen and two others with the crimes.
Though it took quite a few years for the courts to work the case through the system, Jepsen was ultimately found guilty earlier this month.
Jepsen on a Poker High
Poker players emerged from around the world during the poker boom, though quite a few came from Scandinavian countries. Known for their aggressive styles and online poker prowess, they were generally feared at the tables.
Jepsen was among them. In his early 20s and an injured military veteran of the Iraq War, he was a quiet but powerful poker player.
His first big score came in late 2006 when he played the Caribbean Poker Classic on the Caribbean island of St. Kitts. He finished third in the Championship for $165,000. Several months later, Jepsen played the European Poker Tour in Warsaw, and he played the EPT Main Event, winning it for the equivalent of $415,679.
At the same time, he was making a name for himself online, playing at some of the highest stakes. That led to a sponsorship in the fall of 2007 with one of the leading sites at the time, as he became a member of Team Full Tilt.
Jepsen went on to play predominantly online poker, even playing what was, at the time, one of the biggest hands in the game’s history. He took down a pot of more than $499K from Tom Dwan.
By 2009, Jepsen had parted ways with Full Tilt and signed on to represent Ladbrokes Poker and then Betfair Poker.
Interestingly, Jepsen reported in 2008 that he was almost the victim of an online scammer. Someone posed as an employee of a poker company at the time and sent a file for Jepsen to download. That file turned out to be a trojan file, one that would have allowed the originator to view everything on Jepsen’s computer, including his hole cards while playing online poker. Jepsen played the role of the hero by speaking about the incident, how he protected his data, and how other players could be scammed.
In 2009, Jepsen made another claim that someone tried to hack into his computer again. That time he claimed that someone hacked a friend’s account and sent a link. When he clicked that link, he noticed something suspicious and eventually found out it was a trojan.
Fast Forward to 2014
As detailed in this 2014 article by PocketFives, a number of high-stakes online poker players had been accusing someone of installing trojan hacking programs onto their computers or selling cheap laptops to them with the program already installed. The software – Remote Access Trojan (RAT) – allowed the hacker to view the victims’ computers as they played online poker, hole cards and all.
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Poker players tried to solve the crime and eventually began pointing fingers at Jepsen. They eventually took their suspicions to the Danish authorities, who started an investigation.
Tanskalainen Peter Jepsen sai juuri usean vuoden vankeustuomion siitä, että oli kusettanut miljoonia dollareita asentamalla haittaohjelmia pokeriammattilaisten tietokoneille. Lyhyesti siitä, kun jouduin samanlaisen kusetuksen uhriksi Barcelonassa 2013. https://t.co/kCW6DJCT1V
— Jens Kyllönen (@RealJeans89) December 13, 2019
The Copenhagen Police worked with the Economic Crime Department to investigate Jepsen.
Long Road to Justice
The court finally put Jepsen on trial on charges of fraud, though he pleaded not guilty.
According to TV 2, a Danish news outlet, the Copenhagen City Court ruled that Jepsen did, in fact, commit fraud against other poker players by installing a spy program on their computers from 2008 to 2014. He not only used the malware to view his opponents’ hole cards when playing online poker, he also gained access to their bank accounts and stole money directly.
Jepsen was formally convicted of fraud and hacking, leading to the illegal profiting of approximately DKK 26,376,929, which is equal to more than $3.9 million.
The judge sentenced Jepsen to three years in prison, though six months were deducted from that time due to the length of time it took to hear the case.
In addition to the jail sentence, the court ordered Jepsen to repay the money to the victims of his crime. The amount to be repaid is NOK 26,000,000, which equates to just under $3 million.
Jepsen immediately appealed the decision to the Eastern Lands Court, demanding an acquittal.
Peter Jepsen Verdict a Mixed Victory for Poker Justicehttps://t.co/XMcvkLzAZZ
— Flushdraw (@FlushdrawPoker) December 9, 2019
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ByKentucky is poised to work toward legal and regulated online poker in 2020.
Just a few years ago, most experts in the field would have said that Kentucky was one of the least likely states to consider – much less actually legalize – online poker. And not many people could have predicted that the son of former Kentucky Governor Steve Beshear, the one who famously seized dozens of online gambling domains and sued PokerStars, would be one of its most ardent cheerleaders.
While 2019 has been a wild year for many in politics and governance around the world and notably so in the United States, Kentucky is no different. And it is ending 2019 with every intention of moving toward a plan for gambling expansion in the state that will include online poker.
Solid 2019 Progress
Technically, the path toward online poker began in late 2018. Kentucky Attorney General Andy Beshear, Steve Beshear’s son, announced a plan to help solve a pension funding problem, one that was the worst of all 50 states.
His multi-faceted plan included gambling reforms, including casinos, sports betting, fantasy sports, and “preparing for the eventual legalization of online poker.”
Beshear instructed the General Assembly to pass legislation to this effect, dedicating all revenue to Kentucky’s pension systems.
By the beginning of February, a group of 15 lawmakers – a bipartisan group of Representatives led by Rep. Adam Koenig – introduced HB.175. The bill was to legalize sports betting, fantasy sports, and online poker. And it was put up alongside HB.190 to full-fledged commercial casinos in the state, expanded gaming at racetracks, and sports betting.
Weeks later, the bill passed the House Licensing, Occupations and Administrative Committee. But a short legislative session and not quite enough support in the legislature killed the bill when time ran out in March 2019.
Beshear in Charge
It soon became clear that Beshear was running for the governorship of Kentucky. And as he began debating incumbent Governor Matt Bevin, Beshear proclaimed expanded gambling to be the only solution to the pension problem. He also noted the benefits it would bring to Kentucky’s tourism industry.
Bevin only responded with false claims about the dangers of gambling and no alternative funding ideas.
The campaign was contentious, but Beshear emerged victorious.
Big win for online poker in Kentucky last night as @AndyBeshearKY is the state's new governor. He promised expanded gambling in Kentucky, including preparing for online poker… https://t.co/B5wZd7ifAkpic.twitter.com/VBXoo0hFKo
— LegalUSPokerSites (@legal_poker) November 7, 2019
Gambling on Front Burner
Not even waiting for the new year to begin, Rep. Koenig decided to file a bill request on December 5 (though it didn’t become public until December 19). The bill is very similar to the 2019 legislative effort to legalize online poker, fantasy sports contests, and sports wagering at horse racing tracks, sports venues, and online or by mobile devices.
Kentucky Online Poker Sponsor To Take Another Bite At The Apple In 2020 – https://t.co/0Fyrga0Bew
— Sue Schneider (@SuziQSchneider) December 10, 2019
The 79-page bill, which will likely be HR.364 is “an act relating to wagering and making an appropriation therefor.” The legislation specifies everything from the accounting of revenue and distribution of funds, licensing, and oversight to penalties and term definitions, amending current law as necessary.
Section 33 of the bill begins to dive into online poker. It defines online poker as follows:
“Any form of poker, including but not limited to Five Card Draw, Seven Card Stud, and Texas Holdem, at locations removed from other players via the internet through the use of computers, smart phones, or other types of electronic devices. Online poker shall not include video lottery terminals or slot machines using electronic representations of cards in a game of chance in which skill does not play a part.”
Informative take on yesterday’s hearing in Kentucky plus the first analysis (I believe) of the sports betting (plus online poker and DFS) bill pre-filed by @RepKoenig yesterday. https://t.co/JQk3qWuXgA
— Daniel Wallach (@WALLACHLEGAL) December 17, 2019
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This specifically designates online poker as a game of skill.
The Kentucky Lottery Corporation will oversee the licensing and regulation of online poker. Much of the text puts online poker alongside the state’s lottery for all intents and purposes.
Some key points about online poker:
–Players 18 and over will be able to play.
–Geolocation software will ensure that only people within the geographical confines of Kentucky can play.
–Age verification will ensure that no one under 18 plays.
–Security and accounting standards will be required.
–License applicants must not have been convicted of a UIGEA (Unlawful Internet Gambling Enforcement Act) violation.
–License applicants must pay an initial licensing fee of $250,000.
–Licenses will be valid for one year and can be renewed annually for $10,000 each year.
–Licensees will pay a gaming fee of 6.75% of net poker revenue monthly.
–Licensees are not absolved of liability “incurred due to litigation with the Commonwealth over internet poker domain names.” Licenses will be suspended until a final judgment is issued for the improper use of internet domain names until all fines and fees are paid in full.
Holding a Grudge
The Commonwealth of Kentucky still holds a grudge against PokerStars and all online gambling sites involved in its domain seizure case.
Sections about the UIGEA violations and litigation about internet poker domain names is aimed directly at PokerStars.
It all started in 2008 when then-Governor Steve Beshear ordered that 141 online gambling-related domains be seized and put under the supervision of the state. All sites that continued operating in the US market after the UIGEA passed in 2006 were targeted, from small sites to the big ones like PokerStars and Full Tilt Poker.
The case became a very contentious one that involved accusations of censorship and demands for internet freedom. It dragged on for years until Beshear settled with PokerStars and Full Tilt in 2013.
But it was not over, as a state judge ruled in 2015 that PokerStars (then owned by Amaya) owed $870 million in penalties to the Commonwealth of Kentucky. This was for the losses incurred by Kentucky residents who played poker on PokerStars between 2006 and 2011 (Black Friday).
The case ultimately went to the Kentucky Court of Appeals, which ruled in December 2018 that PokerStars did not owe the money. The ruling reversed the original online domain case.
It is unclear what litigation is ongoing, but the bill clearly refers to something awaiting a final judgment, alluding to PokerStars and the case that started more than a decade ago.
The Kentucky Court of Appeals has ruled to reverse the $870 million judgment issued against #PokerStars in 2015 by a trial court judge. The Court stated, 'allowing a complaint, like the one put forth by the Commonwealth, to move forward would lead to an absurd, unjust result.' pic.twitter.com/bP6pJdpn4A
Full Tilt Poker
— Gambling City (@Gambling_City) December 27, 2018