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Thread: Australian web king behind FBI raids

  1. #1
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    Australian web king behind FBI raids



    A FORMER Queensland internet king is believed to have been a key figure behind FBI action against three major gambling websites in the United States.

    Daniel Tzvetkoff, who had been facing 75 years jail in the US, has done a deal with prosecutors which has seen him freed on bail and living in a secret New York location.

    The Courier-Mail reported today that the deal came after Tzvetkoff - a Brisbane boy wonder, who started a company with school mates at 13 - became embroiled in a massive, $543 million stew of money laundering, bank fraud and conspiracy that could bring down the world of online gambling.


    Federal prosecutors in New York yesterday charged the founders of the three largest internet poker companies in the US with bank fraud, money laundering and other gambling offenses and are seeking penalties upward of $3 billion.
    Federal authorities also froze approximately 76 bank accounts in 14 countries that contain proceeds from the alleged offenses. They also shut down five internet domain names used by the three companies to host their games.


    A total of 11 defendants, including the founders of Poker Stars, Full Tilt Poker and Absolute Poker, were named in the indictment unsealed Friday.

    The Courier-Mail reported today that two of those companies Full Tilt Poker and PokerStars, had been seeking $100m they believed Tzvetkoff had taken from them.
    Tzvetkoff was arrested in April last year and charged with money laundering, bank fraud and conspiracy for processing $543m in illegal internet gambling earnings through his British Virgin Islands corporation, Intabill, the trading arm of his now liquidated Brisbane company, BT Projects.

    He was mysteriously bailed last August, and US authorities are using his inside knowledge of the gambling industry to go after gaming companies.

    In yesterday's indictment, federal prosecutors explain that poker companies operating offshore cannot accept most forms of payment "in connection with the participation of another person in unlawful internet gambling." Since most banks in the US would not process their payments, the companies circumvented federal law by making payments appear to be transactions for other types of merchandise.
    In the indictment, federal prosecutors say they arranged for payment processors with bank accounts in the US to receive payments from US gamblers and disguise them as payments for products such as jewelry or golf balls.

    Of the billions of dollars in payment transactions that the Poker Companies tricked US banks into processing, approximately one-third or more of the funds went directly to the Poker Companies as revenue through a charge players must make on almost every poker hand played online.

    That scheme worked for a while until some banks caught on. By 2009, they had shut down many fraudulent bank accounts used by the poker companies. Two of the defendants later came up with a scheme to persuade the principals of a few small, struggling banks to process payments in return for multi-million investments.
    In one case, they persuaded the vice chairman of SunFirst Bank in Saint George, Utah, to process gambling transactions in return for a $10 million investment.

    "As charged, these defendants concocted an elaborate criminal fraud scheme, alternately tricking some US banks and effectively bribing others to assure the continued flow of billions in illegal gambling profits," said Preet Bharara, US Attorney in Manhattan.
    "Moreover, as we allege, in their zeal to circumvent the gambling laws, the defendants also engaged in massive money laundering and bank fraud."

    www.couriermail.com.au/
    The only thing necessary for the triumph of evil is for good men to do nothing

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    Re: Australian web king behind FBI raids

    Interesting. According to a comment by Patrick Pretty, this isn't Sunfirst's first rodeo:
    The poker scandal at SunFirst Bank in Utah is not the bank’s only current scandal. It also has been tied to the alleged Jeremy Johnson fraud scheme. The FTC brought the Johnson case in December, and the FDIC ordered the bank to stop doing business with Johnson.
    Last edited by laidback; 04-17-2011 at 11:59 AM. Reason: typo
    It seems like in this "industry" common sense is not all that common!

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    Re: Australian web king behind FBI raids

    Is this related to the news from yesterday that all the poker gambling websites have been closed?

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    Re: Australian web king behind FBI raids

    So the King gets off and turns in the other bad guys. He should have to serve time also. Too bad, he will be up to something else crooked.
    Last edited by scratchycat; 04-19-2011 at 11:05 AM. Reason: wanted to change it

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    Re: Australian web king behind FBI raids

    Yep,

    same case.

    Tzvetkoff was looking down the barrel of up to 75 years in jail for his part in the scam:

    Daniel Tzvetkoff allegedly shifted millions in online gaming rort via phony websites






    Tzvetkoff's company Intabill allegedly processed more than $543 million in transactions between US gamblers and internet gambling websites. Picture: Annette Dew

    FALLEN Brisbane IT entrepreneur Daniel Tzvetkoff was allegedly part of an international online gaming rort which used phony websites selling everything from golf clubs, flowers, pets, jewellery and bicycles to launder billions of dollars in illegal earnings.

    The revelations were revealed in a 52-page US indictment obtained by The Courier-Mail and filed in the Southern District Court of New York by American authorities against 11 online gaming kings accused of fraud and money laundering.

    The charges, against some of the most powerful online gaming chiefs in the world, came as a result of the Ipswich-born Tzvetkoff turning supergrass against his former peers to ensure his own release from a 75-year sentence in a US jail.

    Included as a defendant is Isai Scheinberg, the founder of the largest online gaming site in the world, Poker Stars, a man estimated to be worth more than $US1 billion.
    The indictment alleges the giant US poker houses shortcircuited Visa and Mastercard regulations and tricked US banks into authorising their internet gambling transactions.

    "In or about 2008 the defendants created dozens of phony e-commerce websites purporting to sell everything from clothing to jewellery to golf clubs to bicycles which, in reality, would be used to disguise gambling transactions," the US indictment says.
    Several of the online poker chiefs allegedly created a bogus "Green2YourGreen" business, claiming to be an environmentally friendly household products concern, to be used to disguise payments from US gamblers destined for US major online poker companies.

    Tzvetkoff is named as one of the major offshore principals who sought to deceive authorities and circumvent strict money laundering regulations.
    A glimpse into the sheer size of Tzvetkoff's fallen empire is given in the court documents, which say his collapsed Intabill online processing company processed more than $US500 million worth of illegal transactions for the world's largest online poker houses in barely two years.
    The US indictment shows that Intabill processed at least $543,210,092 of transactions for major online poker companies from mid-2007 to March 2009.
    It also lists a string of diverse international banks the US authorities claim were used by the online poker operators to hide funds.
    The banks range from Antigua, Cyprus, the Philippines, Hong Kong, Panama and Ireland through to Utah, Illinois, Colorado and Florida.
    Fallen online tycoon Daniel Tzvetkoff faces 75 years jail | News.com.au
    The only thing necessary for the triumph of evil is for good men to do nothing

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    Re: Australian web king behind FBI raids

    Quote Originally Posted by honestme11 View Post
    Is this related to the news from yesterday that all the poker gambling websites have been closed?
    Not closed....Just that those in USA can no longer withdraw their money....
    This has led to a black market for cash outs now being established....
    In short....A USA player goes and plays one on one with say an Aussie....
    The American deliberatly looses all his money to the Aussie who then cashes out to an Aussie bank....
    Then the Aussie forwards the money to the American less 30%....

    The largest American account on Full-Tilt has over 60million in it.....So we talking about a lot of money here that the US Gov is looking to pocket....
    ʎɐqǝ uo pɹɐoqʎǝʞ ɐ ʎnq ı ǝɯıʇ ʇsɐן ǝɥʇ sı sıɥʇ

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    Re: Australian web king behind FBI raids

    The US government realized that attempting to prevent US citizens gambling online would be impossible to enforce.

    Instead, it introduced the Unlawful Internet Gambling Enforcement Act of 2006 which did not specifically prohibit online gambling, instead, it outlawed financial transactions involving online gambling service providers.

    IOW, attempted to cut off the money supply.

    In response, many online gambling operators either closed down their US based services or excluded US customers.

    This case revolves around the US government seizing domains and freezing funds it alleges were involved in attempting to "launder" funds to make them appear to be from non gambling sources.

    The only thing necessary for the triumph of evil is for good men to do nothing

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    Re: Australian web king behind FBI raids

    Quote Originally Posted by littleroundman View Post
    The US government realized that attempting to prevent US citizens gambling online would be impossible to enforce.

    Instead, it introduced the Unlawful Internet Gambling Enforcement Act of 2006 which did not specifically prohibit online gambling, instead, it outlawed financial transactions involving online gambling service providers.

    IOW, attempted to cut off the money supply.

    In response, many online gambling operators either closed down their US based services or excluded US customers.

    This case revolves around the US government seizing domains and freezing funds it alleges were involved in attempting to "launder" funds to make them appear to be from non gambling sources.

    Yes their web site has what you posted on it's home page but in the poker room it's business as usual....Though I must add that the Ivey room(higher stakes games) is like a morgue and there is barely an american to be found....
    It actually looks like Paradise poker site did when the law came in and they booted all the Americans....

    Also worth noting that the European based poker rooms that never allowed those from USA in are now advertising big time to tell those in countries like Aus that they still there and we are welcome to come play....
    Large first deposit bonus is being offered by sites like noIQ poker....
    ʎɐqǝ uo pɹɐoqʎǝʞ ɐ ʎnq ı ǝɯıʇ ʇsɐן ǝɥʇ sı sıɥʇ

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    Re: Australian web king behind FBI raids

    Will also be interesting to see what the pros advertise on their shirts at the next WPT event....Most were wearing Full Tilt shirts till now...
    ʎɐqǝ uo pɹɐoqʎǝʞ ɐ ʎnq ı ǝɯıʇ ʇsɐן ǝɥʇ sı sıɥʇ

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    Re: Australian web king behind FBI raids

    Latest news....

    A deal has been done so the poker sites now have their web sites backs and Americans can now withdraw their money.....

    April 20 - If you have money frozen at Poker Stars or Full Tilt Poker there is good news, you can now withdraw your funds effective immediately. If you're dumb enough to have an account with Ultimate Bet or Absolute Poker then you still have to wait because they have yet to accept the deal, which was offered by US authorities.

    In fact those sites have yet to stop Americans from playing for real money. US online poker players cannot deposit, withdraw, or transfer funds on those two sites but they can still play. That won't sit well with authorities.

    The U.S. government has also agreed to allow PokerStars and Full Tilt Poker to resume use of their .com domain names that had been "seized" and shut down last week.

    The two responsible online poker companies (you know the ones that didn't cheat players out of more than $10 million) agreed to the "domain name use agreements" and will be allowed to reactivate pokerstars.com and fulltiltpoker.com in order to "facilitate the withdrawal of U.S. players' funds held in account with the companies."

    Prosecutors said the same agreement is open to Absolute Poker, the third company indicted last week, if it chooses to accept.

    The government initially filed "restraining orders" against several bank accounts and the domain names used by the poker companies. However, prosecutors now contend that the companies were never required to freeze player accounts.

    Preet Bharara, the U.S. Attorney for the Southern District of New York, said that no player accounts were ever frozen or restrained, and each poker company has been free to reimburse any player's deposited funds, which was probably news to them and everyone else in the industry. We all remember NETELLER, and that debacle did result in account holder funds being frozen for several months.

    "In fact, this office expects the companies to return the money that U.S. players entrusted to them, and we will work with the poker companies to facilitate the return of funds to players," Bharara said in a statement.

    When the US government plays nice like this it can mean only one thing - Full Tilt and Poker Stars are ready to cough up their share of the $3 billion. The quicker they do that the quicker they'll be able to get back to business outside of the US. As for the other company - well, it would come as no shock if they didn't have the ready cash to settle. Players with accounts there should prepare for a long haul.
    Poker Stars and Full Tilt Players Can Now Get Funds Back - 04-20-11
    ʎɐqǝ uo pɹɐoqʎǝʞ ɐ ʎnq ı ǝɯıʇ ʇsɐן ǝɥʇ sı sıɥʇ

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