Accused strikes plea deal in poker case

The first of 11 individuals indicted in the biggest US prosecution against online poker companies doing business in America has pleaded guilty, giving more momentum to the law enforcement team.

The plea deal came on the same day that a separate grand jury in Baltimore indicted two other businesses, two Canadian residents and a woman living in Costa Rica with fresh gambling and money laundering charges.

In the earlier case, Bradley Franzen agreed to plead guilty to bank fraud and money laundering conspiracies as well as violations of the Unlawful Internet Gambling Enforcement Act of 2006, according to papers released on Monday by the US attorney for Manhattan.

Mr Franzen operated as a middleman, connecting payment processors for all three of the poker companies cited in the indictment that was unsealed last month, the new filings say.

The documents say that between 2007 and 2011, he ran a business based in Costa Rica that helped PokerStars, Full Tilt Poker and Absolute Poker by finding payment processors that disguised transfers from Americans to the betting companies.

Because US banks declined to handle betting transactions, the processors mislabelled the payments as being for environmentally friendly household products and internet marketing campaigns, the superseding information says.

The document cites other unnamed and unindicted conspirators, suggesting that the investigation is being aided by others who have been co-operating.

The Baltimore case has led to the seizure of 10 web addresses, including Doylesroom.com, betmaker.com and boomaker.com.

US immigrations and customs enforcement officials said they won the indictment and seizures after a two-year undercover probe in which they set up a payment processor that handled $33m in transactions.

The previous case gained force from a similar seizure order that blocked access to PokerStars and FullTilt. Under a subsequent arrangement, those sites are open to non-Americans, while US residents can only apply through them for refunds from their accounts.

If convicted on all three counts, Mr Franzen could face a combined maximum of 30 years in prison, but prosecutors promised to ask for a reduced sentence as long as he co-operates.

The government has also filed a $3bn civil suit seeking to recover profit at PokerStars, Full Tilt Poker and Absolute Poker, which are based in other countries but had a combined majority of the US market.

Three others accused in the first case have been arrested, including one who was detained in Guatemala and brought to court in Miami.

Other defendants live in Europe and have apparently avoided arrest, although the money-laundering claims could allow for extradition proceedings even from countries where online poker is legal.