Cookies on the PokerWorks Website

We use cookies to ensure that we give you the best experience on our website. If you continue without changing your settings, we'll assume that you are happy to receive all cookies on the PokerWorks website. However, if you would like to, you can change your cookie settings at any time.

Continue using cookies

Poker News | World Poker News

Two Black Friday Indictees Dispute Charges With Strong Legal Arguments

Share this

John Campos and Chad Elie just might become the two people who will prove the U.S. Department of Justice wrong and once again redeem poker's reputation as a game of skill as well as reclaim the reliability of the online poker business.

Although it's a long shot, Forbes' Nathan Vardi announced on Sunday that Campos and Elie have already made the first step by filing legal papers stating that DoJ's indictment against them and the online poker companies have no basis. They argue that the charges of which the U.S. government accused online poker providers – running an illegal online gambling business – have no legal value as none of the companies mentioned in the case have actually provided online gambling services.

Both Campos, a former vice-chairman of a Utah bank, and Elie, a payment processor who facilitated the flow of funds between U.S.-based players and online poker sites, were indicted on April 15th by the U.S. Department of Justice along with nine other individuals with charges of fraud, money laundering, and illegal online gambling activities. Although the two indictees have filed separate papers, they have both provided very strong arguments on why the charges against them as well as the online poker sites were invalid and why all counts filed against them in federal court in Manhattan should be withdrawn.

According to the indictments issued by the United States Attorney's Office for the Southern District of New York on April 15th, 2011, Campos and Elie were amongst those that violated the Unlawful Internet Gambling Enforcement Act, the Illegal Gambling Business Act, and conspired to commit money laundering. However, both defendants argue that the online poker companies indicted on Black Friday including PokerStars, Full Tilt Poker, and Absolute Poker did not run house-banked games which is prohibited by UIGEA. Campos and Elie state that online poker providers have not profited from their players' losses, but “charged a fee, known as a rake, for facilitated poker betting on their web sites that was related to a peer-to-peer game in which players competed against each other and not the house.”

“PokerStars and Full Tilt are not ‘illegal gambling businesses’ under IGBA because they are not ‘gambling businesses’ at all,” says one of the legal documents. “To be ‘engaged in the business of betting or wagering’ requires that the business has a stake in the outcome of gambling contests, and the Indictment here fails to allege that the poker companies had any such stake.”

In his document Campos who was also vice-chairman of Sun First Bank, demands that all charges against him are dismissed as according to the Unlawful Internet Gambling Enforcement Act, financial transaction providers like a Utah bank as well as those working on their behalf are to be excluded. Elie had filed a total of three legal papers justifying his claim to cancel all charges filed against him on April 15th which, according to him, are “a part of flawed attempt by the government.”

Both Campos and Elie point out that the government's attempt to shut down the online poker companies by charging them with violating the Illegal Gambling Business Act is invalid as poker cannot be referred to as gambling. In fact the Act includes nine activities listed as gambling including bookmaking, lottery, roulette slot machines as well as other casino games, but poker is not among them. The memorandums argue that poker is a game of skill and not chance and it's not a house-banked game, therefore it cannot be referred to as a gambling. “Online poker is a game in which the outcome depends to at least some degree on skill,” states one of the court filings.

The defendants also took the opportunity to sting the U.S. Attorney General Eric Holder who confessed that he could not tell if poker was a game of chance or skill. “The common man is at a loss,” Elie argues in one of his memos. “Indeed, the Attorney General himself has commented that determining whether poker is a game of chance is ‘beyond [his] capabilities.’”

In their papers Campos and Elie disagree with the charges issued against the online poker companies stating that they were running their business offshore and that the state of New York has no legal right to indict them. In one of his memos Elie argues that “the government is improperly using New York state law to bring federal charges of violating the Illegal Gambling Business Act.” Both indictees say that the money laundering charges are based on fake statements and therefore should be canceled.

By filing their papers, Campos and Elie have made one of the most straightforward challenges ever against the government's policy concerning online poker. However, the fight seems to be a long and hard one and the final result is not likely to be reached in the near future.

We hope you'll follow us on Twitter! And like us on Facebook.

News Flash

The IRS Scores Big at 2015 WSOP ME Final Table

The IRS managed to snag 34.13 percent from the payouts of the 2015 November Nine, totaling $8,467,091.

Read more

Quick Room Review

Bonus Room review

Subscribe to the Nightly Turbo

Be the first to know all the latest poker news, tournament results, gossip and learn all about the best online poker deals straight from your inbox.

RSS Feed