The founder of PokerStars, Isai Scheinberg, pled guilty to one count of operating an illegal gambling business last Wednesday afternoon in a New York federal court. The 73 year old’s guilty plea will face a possibility of five years in jail, to be sentenced at a later date.
The court battles began nearly nine years ago after the United States Government Department of Justice charged the owners of PokerStars, Full Tilt Poker, and Absolute Poker with operating illegal gambling businesses. Black Friday, as what is usually known in the poker community, refers to the day the three largest online poker sites in the United States were shut down. In April 2011, eleven individuals, including Scheinberg, were charged by federal prosecutors with bank fraud, money laundering and illegal gambling. The other executives included in the indictment have since pled guilty and received their sentences already.
Manhattan United States Attorney, Geoffrey S. Berman said in a statement, “Ten years ago, this Office charged 11 defendants who operated, or provided fraudulent payment processing services to, three of the largest online poker companies then operating in the United States – PokerStars, Full Tilt Poker, and Absolute Poker – with operating illegal gambling businesses and other crimes. As Isai Scheinberg’s guilty plea today shows, the passage of time will not undermine this Office’s commitment to holding accountable individuals who violate U.S. law,”
Extradited to the United States
Scheinberg, who initially pleaded not guilty and posted $1 million for bail, avoided US soil for nearly nine years in awareness of the US criminal charges against him. In January 2019, however, the final defendant was apprehended by officials in Switzerland and was requested to be extradited back in the United States by October. With a bit of resistance, the dual Canadian and Israeli national had no choice but to face his existing charges and surrender himself to federal agents two months ago.
During his first court appearance, federal prosecutor Olga Zverovich told a hearing that Scheinberg had been negotiating with the government and had an “agreement in principle” at the time. Even with the prison time recommended by Congress, it is highly unlikely that Scheinberg will face the maximum penalty of five years. Under his plea agreement, prosecutors agreed to seek a sentence of 12 to 18 months.
He’s pleased to put the matter behind him, a spokesman for Scheinberg said in a statement, “Notably, all PokerStars players were paid back immediately and Mr. Scheinberg played an important role in ensuring that all of the players from other sites were repaid as well”.
End of Black Friday
With the last of the defendants pleading guilty, the Black Friday chapter in poker history books is essentially coming to an end. PokerStars, on the other hand, has since partially re-entered the US market, hosting online games for now legal and regulated states New Jersey and Pennsylvania. The company was sold by Scheinberg back in 2014 to The Stars Group (formerly Amaya), the current largest online gambling company in the world. The founder walked away with $4.9 billion from the deal after agreeing to a civil asset forfeiture settlement with the government and handing $731 million in fines a few years back.
The present-day online poker situation is quickly evolving with many players eager to get back on the virtual felt. With multiple opportunities on the rise, poker operators such as GGNetwork, 888poker and partypoker are on the move to expand their player pool and claim the hold PokerStars once had.
With the ongoing Coronavirus (COVID-19) pandemic, real money online poker has seen a surging interest in turnouts and overall action which will seemingly continue in the upcoming months.