Isai Scheinberg admits to his guilt.
The man behind PokerStars, Isai Scheinberg, has confessed in a New York court to operating an illegal online gambling business worth millions of US dollars. He's facing up to five years in prison. Scheinberg handed himself over to American authorities at the end of January after nearly nine years abroad. What's the gist of this story?
End to a Long-Waged Legal Battle?
In a prolonged trial involving bank fraud, money laundering, and unlawful gambling, Isai Scheinberg, the former founder and CEO of PokerStars, has admitted his guilt in a New York federal court. The judge overseeing the case is Sarah L. Cave. He confessed to unlawfully running his online poker company, disregarding the 2006 Unlawful Internet Gaming Enforcement Act (UIGEA).
Schemeberg's admission suggests he knew operating his business contravened federal laws. Yet, despite this knowledge, he carried on with his multi-million-dollar online poker business in the US until 2011. Prosecutors also mention Full Tilt Poker and Absolute Poker in the case. The Public Prosecutor's Office's official statement reads:
"Though all major online gambling companies ceased doing business in the United States after the UIGEA, PokerStars and Full Tilt Poker, along with Absolute Poker, continued providing illegal online poker access to U.S. customers until March 2011."
Predicted Sentencing
Scheinberg surrendered to US authorities in January. With an initial not-guilty plea, he was granted $1 million bail. Federal prosecutor Olga Zverovich has mentioned that "an agreement in principle on the fundamental terms" has been agreed on with Scheinberg.
The verdict is imminent. According to the Department of Justice, while Congress requests a five-year sentence, it's likely Scheinberg won't actually serve this punishment in jail.
Complicated Criminal History
The New York Attorney General's Office points out that Scheinberg's guilty plea proves the Department of Justice will not be deterred by time. Since the indictment, a lot has changed in the US gambling landscape. In May 2018, the Federal PASPA rule was repealed, starting a liberalization process for online gambling in the States.
Now the US State handles regulations, leading to a booming online sports betting market. Meanwhile, some counties also legalized online poker, including six states and most recently, Pennsylvania, followed by Michigan's amendment law. However, Scheinberg's case remains untouched. Scheinberg, who established PokerStars in 2001, fled the US in early 2011. Scheinberg was a fugitive for nine years, spending most of the time in Canada or the British offshore island of Isle of Man.
Although the US authorities never gave up, Scheinberg still provided support from his exile. PokerStars settled a civil forfeiture and civil money laundering lawsuit filed by the US authorities in 2012, resulting in the company forfeiting $547 million. Scheinberg agreed to cease his affiliation with PokerStars by relinquishing all management responsibilities; his son Mark Scheinberg took over. In 2013, he forfeited an additional $50 million to the Department of Justice to avoid any future charges.
PokerStars' current Status
Ultimately, the Rational Group, founded by PokerStars' father Scheinberg, sold to the Amaya Gaming Group for $4.9 billion in June 2014. Presently, The Stars Group (TSG) runs the PokerStars brand, which is the worldwide leader in the online poker industry. Scheinberg, who earned a math degree from Moscow State University, has since become a folk hero among online poker enthusiasts. Recently, TSG announced an $11.2 billion merger with Flutter Entertainment, which, if approved, might create the world's largest online gaming enterprise.
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Source: www.onlinecasinosdeutschland.com
