By Kyle Munzenrieder
By Kyle Munzenrieder
By Terrence McCoy
By Jeff Weinberger
By Ryan Yousefi
By Chuck Strouse
By Terrence McCoy
By Terrence McCoy
The feds launched an even bigger hit on the television industry. The list of cancelled shows since April is long. Poker After Dark, a late-night show on NBC, was axed after four years when the government deemed its sponsor, Full Tilt, a "Ponzi scheme." High Stakes Poker ended a six-year run on the Game Show Network in December. The National Heads-Up Poker Championship, also on NBC, collapsed in October after seven years. In April, Fox pulled PokerStars Big Game and PokerStars Million Dollar Challenge prior to their second seasons.
According to Kantar Media, Full Tilt and PokerStars spent $26 million in TV advertising last year; PokerStars spent another $8.3 million on web and magazine ads. But the feds made it all disappear.
Though the government wiped out the major American sites, a few remain, most notably Bovada and Merge Gaming Network.
The volume is much lower, and it's difficult to get paid. All sites have severe restrictions on how much and how often players can withdraw money from their accounts. Merge allows players to take out only up to $2,500 once every six to eight weeks. And many players find it difficult to add money to their accounts because credit card companies often reject the transactions.
After Black Friday, players such as Walter Wright began gambling on Merge just to salve nerves made raw by an empty wallet and a squealing baby. Wright had been an online-poker superstar, winning more than $100,000 a year at his peak. When Black Friday hit, he was stuck in North Carolina, out of a job, living with his in-laws , and with no way to provide for a family of four.
He and his wife went to Florida for a live World Poker Tour event, but he didn't play well. When they returned to North Carolina, they didn't even have enough money to get their dogs out of the kennel.
With their marriage stretched to its breaking point, Wright went to Costa Rica just before Thanksgiving. A friend agreed to front him a roll of cash, pay his airfare, and cover his rent for a few months.
Costa Rica has become a magnet for Americans. Wright lives in an apartment complex with other online players. The country's tourist-friendly economy makes it a logical landing spot for those like Wright, who has a DUI conviction and subsequently isn't allowed into Canada. Since Black Friday, companies such as Poker Refugees have sprung up to help players obtain visas, bank accounts, and apartments in Costa Rica.
But a larger question remains: Why are the feds chasing honest, taxpaying citizens out of the country? Especially for something as benign as playing cards, a pastime nearly every American has enjoyed?
Congressman Frank denounced the crackdown as an "incredible waste of resources," wondering why the feds felt compelled to protect "the public from the scourge of inside straights."
After all, for most of the nation's estimated 2 million online players, poker is little more than leisure recreation. And those who made their living from it seemed to personify the American spirit, using their wits to create livelihoods that provided for families.
There's also the question of why conservatives such as Frist and Kyl would push a law so lush with the dreaded nanny-state overtones. "I believe in a smaller, more conservative role for government than telling me which card games I can play on my computer," Fritz says vaguely.
Frist declined to comment about his motives. Kyl didn't respond to repeated interview requests.
Most players cynically dismiss the senators' move as a strong-arm play. The feds want their protection money — i.e., taxes — and won't let the ride continue until someone pays up. But because government moves in slow motion, it has left a multibillion-dollar industry to rot from atrophy. Any remedy will likely take years.
"It's really frustrating to me," LaTour says. "It just seems they weren't seeing any of that money that was going out there so they want to set it up so they can tax it. But the longer this takes, the more there will be people like me who just give up on it and move on with our lives to find another way of making a living. I've pretty much stopped waiting around."
A solution seems rather simple. Because everything is handled electronically, Internet poker offers the possibility of instant taxation of winnings. And the feds could easily force sites operating in the U.S. to pay American taxes for the privilege of doing business here.
Yet the average poker enthusiast doesn't employ a battery of lobbyists on Capitol Hill. And even if he did, he'd still be confronted by the moralists who believe any form of gambling is a sin.
"We're a pretty small minority," Wright says. "We don't have a big voice. We need to be louder. But we're talking American politics. We know it's going to take longer than it should, they're going to find a way to screw people, and they're probably going to make the taxing situation really complicated."
Within a month of the federal crackdown, PokerStars returned $100 million to U.S. players and continued to operate abroad. Barros, like other PokerStars players, was given back the several hundred dollars that was frozen in her account on Black Friday.
This is little more than an outstanding example of the American government bending to the demands of the few rich pricks out there that got their panties in a bunch because someone else came up with an idea first and was making money. God forbid people in "The land of the free" be able to have the choice between driving (which costs money) to a "local" casino to play poker and paying ridiculous house takes, and choosing to stay home and play at their leisure. With all the crap "we the people" have being crammed down our throat by our elected officials its not going to be a big surprise when one day we wake up and find that many people are fed up and will take violent action against these affronts by the fatcats. Mark my words, its coming and likely a lot sooner than later. This isnt a rant, if people are blind to whats happening in our society than thats your problem but dont act amazed when people just start snapping.
Next The Feds should concentrate their efforts in shutting down Wall Street Big Bank Crooks and Politicians that keep flagellating us with higher gas prices and rich bailouts ;(
Many unemployed people were able to pay their bills by playing in these sites. Shame, shame GOP. But the GOP act very similar like Fidel, trying to control every aspect of Americans.
The GOP also use the Bible like Castro uses the communist manifesto, to control, control, control and destroy DEMOCRACY.
Online gambling is illegal. Why am I supposed to feel sorry for people who made a living doing something illegal? sorry you don't get to indulge every vice including gambling while sitting in your underwear at home.The opportunity to play poker is readily available at licensed casinos and virtually every state including Florida has multiple casinos. If licensed casinos think there is sufficient demand for poker playing between players at separate locations whats to stop them from doing it? Incensed race tracks operating casinos and casinos operate simulcast horse racing betting don't they?
It would seem that shortly after the Feds shut down online poker, The world went bankrupted. Think about that.
Thanks for this informative article about online poker and what the government did to it. An entire industry was destroyed last year. This is the first article that really illustrates the situation. We need federal legislation that licenses and regulates online poker in the U.S. and brings back an industry.