As you all know, Stanley Sludikoff, the owner of Poker Player Newspaper, passed away March 12, 2016.

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Poker Scandal Plagues Industry Part 3

by Stanley R. Sludikoff, Publisher
[Read Part 1 Read Part 2]
There is no doubt that the United States of America has unclean hands in this mess. First Congress failed to protect its citizens when they knew that millions were playing poker on the internet. Instead a small minority of senators and representatives, who were seeking to legislate morality as they saw it, looked for a simple way to stop people from gambling on the internet.

 The method they chose was to sneakily pass a bill, the UIGEA, by attaching it to another bill— dealing with port security—that the president HAD TO SIGN. Although this is standard operating procedure in the Congress, it is not the way our founding fathers wanted the federal government to work. All federal legislation needs to be heard and debated in both houses of Congress. Anything less is a perversion of the Constitution they all have sworn to uphold.

 That bill was extremely difficult to enforce and highly questionable. Santyana said, “Those who fail to learn the lessons of the past are condemned to repeat them.” It looks like a large number of Senators and Congressmen managed to fail American History 101. Remember prohibition; it didn’t work!

 Now we have a new wrinkle in US government activity. This time the actions of the Department of Justice have come under close review. As most people know by now, a recent legal opinion by the DOJ states that the main federal antigambling law, the Wire Act, applied ONLY to sports and race betting on the Internet. This has major repercussions for the recent actions of another hand of the DOJ, the US Attorney’s office in New York.

 You see, some clever person in that group figured that because people playing poker on the internet, specifically on Full Tilt, they were engaging in illegal activity and their winnings could be confiscated. This amounted to tens of millions of dollars that the winners would never see again.

 Instead, the NY federal prosecutor’s office would use the money to pay for their expenses in investigating and prosecuting the alleged culprits in this scandal. The Black Friday indictments were not based on the Wire Act, apparently because the DOJ knew that that statute did not cover poker. Instead, they based the federal charges on New York state misdemeanor anti-gambling laws, which might not apply to poker, especially overseas poker with no connection to New York. If it turns out that this activity was NOT illegal, DOJ should be giving it back to the players. In which case, where will the money come from to pay the DOJ bills? WOW!

 And if DOJ does not restore the player’s winnings, they better have a good legal argument or they are no different than the Full Tilt and Absolute Poker/UB managers who embezzled millions from their customers. Perhaps they are even worse since they acted under color of authority.

 As you will see in future editorials on this subject, the total number of persons who have engaged in criminal activity could be very large. Such an investigation will be extensive. It is typical of DOJ that once they have scored a legal victory and nab the top people, all the little crooks manage to sneak under their radar. The usual problem with this is that the activity continues since both the little crooks and a new generation of crooks saw how so many got away with the crime. It now becomes a worthwhile risk for the shady side of human nature to take a shot at the same thing. In other words, the DOJ usually does an inadequate and slipshod job.

 Perhaps the recent Madoff scandal shows us just how DOJ works. Do you think Bernie Madoff pulled this scheme off all by himself and that none of his associates were guilty? Do you think Mrs. Madoff should have been allowed to keep $2 million dollars while many of Madoff’s client’s lost their life savings? Why isn’t she also in jail??? And why hasn’t any action been forthcoming with other obvious lawbreakers in this scandal? Let’s put down the taxpayer’s eggnog and get back to work.
The Holiday is over.
Continue onto Part 4.

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