Internet Poker Shut Down in United States

Today the U.S. Attorney for the Southern District of New York released criminal charges against a number of online poker websites operating in the United States as well as charges against a number of companies involved with processing payments to and from these sites. A DoJ release describing the lawsuit can be found here.

As a result, the largest sites offering poker in the United States have immediately suspended players from the United States from participating. There are millions of dollars that belong to United States citizens tied up in these sites that have also become immediately unavailable. It is unclear if/when any of this money will be able to be recovered.

A law was passed in 2006 which made it illegal for financial institutions to process payments that would be sent towards online gambling sites. This law was not particularly effective, as it was still fairly easy to find organizations that either believed (1) that they were still operating legally, or (2) didn’t care that they were operating illegally. This has now changed.

Today’s lawsuit was dropped out of the blue and has resulted in the immediate suspension of access for U.S. players to online gambling services. The Poker Players Alliance will have an official statement up sometime today.

It is a sad day for a free society. This might be the final straw for online poker. A bill to move forward with federal legalization and regulation failed in Congress last year, though may still succeed this year. Various state legislatures, including the District of Columbia, are moving forward with patchwork regulations. Unfortunately, the outlook is dim on the state level as many such programs will be run by government monopolies — supporting the paternalistic idea that we can only gamble under the watchful eye of government.