The Future of U.S.-Facing Poker Sites & the Safety of Funds
While everyone is largely occupied with the 2011 World Series of Poker, the events of April 15 and May 23 have not been forgotten by the poker community. For those who may not recall, those were the dates that the U.S. Department of Justice and U.S. Attorney’s Office for the District of Maryland cracked down on online poker with a series of indictments and domain seizures. Consequently, the dates have been referred to as “Black Friday” and “Blue Monday” respectively.
Before the WSOP, PokerNews reached out to numerous sites that are still serving U.S. players and asked the following questions:
- Has your site experienced an increase in traffic since Pokerstars/Full Tilt/Absolute Poker/UB left the U.S. market?
- How is your site able to continue offering real-money play to U.S. players? Is this being offered legally?
- Player funds has been a hot topic as of late. Are player's funds safe on your site? Are player's funds held in a separate account than other operating expenses?
- What would you say to players to reassure them that their money is safe on your site?
Unfortunately, the vast majority of sites we contacted did not respond or declined to comment. They included the Everleaf Gaming Network, Bodog, Cake Poker, and Doylesroom. Given the recent indictments in May, it seems the questions are no longer applicable to the latter site whose domain was seized by the U.S. Attorney’s Office for the District of Maryland.
While some sites remained silent, a few were happy to talk to PokerNews, albeit with the boilerplate responses the poker community has learned to endure. For instance, Marco Griffin of Carbon Poker support responded to our inquiry with the following:
“Thank you for your email. We sincerely apologize for the delay in responding, we are currently experiencing a high volume of emails. Staff adjustments are being finalized and our response times should return to normal shortly. Your understanding and patience during this period of unprecedented growth are greatly appreciated.
“Regarding the recent news of some Internet gaming companies encountering legal issues, we can inform you that we have not been affected by these recent events. We will continue to provide a safe and secure gaming experience for our players.”
Chuck Kidd, CEO of the Poker Pro Network (PPN), elaborated a bit more, saying that his site had experienced a 22 percent increase in traffic since Black Friday. When asked how PPN is able to operate in the U.S., Kidd said: “How many times must it be said that unless there is a particular state ban on poker you are not playing illegally under any U.S. law . . . This indictment is not about poker... it is about a criminal conspiracy to commit bank fraud, wire fraud, money laundering and factoring of credit cards. You could change the headline to read Online Pharmacy owner arrested and it would still be the same issue. The U.S. Government is using this opportunity to attempt to paint our industry in a bad light with a very broad brush to scare players and owners. These were criminal acts no matter the industry and now the DOJ is calling all of us crooks and scaring the players.”
He went on to address the issue of player’s funds on PPN: “We must segregate our funds and have a reserve for all chips in play. So every chip used at PPN by a player is covered by this Cash Reserve. As to the safety of the funds, I do not use the Cake Network Cashier system but rather our own. This allows PPN to be totally autonomous from any third party processing. So between PPN and the bank, [they’re the] only companies I control directly and in our five-year history no player has ever lost their money with us.”
Likewise, PokerView has experienced a 26 percent increase in traffic since April 15. Sandy Hart, spokeswoman for site, assured players that their site is “licensed and is operating under the Lotteries & Gaming Authority of Malta and is therefore able to accept real-money players internationally.” She also touched upon the topic of funds: “Player funds is considered to be one of utmost importance to PokerView. PokerView prides itself in providing fast cash outs to all its players to ensure maximum player loyalty and satisfaction.”
While both PokerView and PPN are optimistic and reassuring, the constant threat of seizures, like those that occurred on Black Friday and Blue Monday, are no doubt discouraging to players looking for a new place to play. The fear of legal repercussions and lingering questions regarding player funds have certainly taken their toll on the industry, even on the sites still catering to U.S. players.
This was recently evidenced last month when Josh Brikis made an announcement via Twitter: “I regret to inform that I have ended all relationships with and my status as a ‘Pro’ for PPN.” When contacted by PokerNews, Brikis went on to explain his decision: “It was my choice. I just didn’t want to bother with telling people all summer their money is safe and you can withdraw and all that. After the second wave of shutdowns I said that was enough, I will wait until the government is done and it’s legal and everything. Nothing against PPN or Chuck [Kidd] at all, I just didn't feel comfortable anymore with it. I plan on playing 20+ events and a lot more mixed games than I have in the past. It is a huge summer for me considering I am not backed and don't sell my action out. Being on a five-month downswing, this summer's WSOP means a lot to my future.”
Brikis’ reliance on the 2011 WSOP as a sort of proving ground is something echoed throughout the poker community as former online grinders and sponsored pros are left with few options other than either moving to Canada, ala Cole South, or grinding the live tournament circuit — unless of course they’re willing to once again chance the online realm with a new site.
While some sites still continue to serve U.S. customers, the immediate outlook for the industry is bleak. Rumors are swirling that Lock Poker will no longer allow new cash customers from four states (New York, Maryland, Louisiana, and Missouri) and the District of Columbia. PokerNews attempted to confirm these reports with Lock Poker CEO Jennifer Larson, but she declined to comment. To make matters worse, many industry insiders are predicting the seizure of even more domains in the future.
On a brighter note, many industry experts predict the legalization and regulation of online poker by the U.S. government in the future, though realistically that day may be many years away. Only time will tell what will happen with what is left of the online poker industry. In the meantime, there are still plenty of sites open to U.S. players, just be sure to do your homework before depositing to ensure your money is as safe as can be.