Isai Scheinberg, the founder of the international iGaming giant, PokerStars, will not have to go to prison.
SDNY, Sept 23 - When Isai Scheinberg, after being indicted in 2011 and recently returning from Switzerland voluntarily though following an extradition request appeared in U.S. District Court for the Southern District of New York on February 20, the mood was strangely cordial. The last of those to face federal justice, PokerStars founded Isai Scheinberg, has now pleaded guilty, according to a press release from the DOJ. Isai Scheinberg has pleaded not guilty to the charges filed against him and was released on $1 million bail. Nov 14, 2016 The 36-Year-Old Former CEO Of Amaya Offers $6.7 Billion Deal To Buy The. Isai Scheinberg is the last of the individuals that will have to face charges related to the unlawful gaming operations in a case in which 11 defendants in total were charged in the original indictments – 2 from PokerStars, CEO Scheinberg and Payments Director Paul Tate, 2 from Full Till, CEO Raymond Bitar and Director of Payments Processing. Isai Scheinberg, the notoriously famous founder of renowned online poker app PokerStars, has surrendered himself to the U.S authorities after being accused and charged for planning illegal gambling, bank fraud, and money laundering by the United States federal government. Scheinberg has to plead not guilty and was released on a bail of $1 million.
That good news was delivered by Judge Lewis A. Kaplan. Scheinberg's age and effective plea bargain seemed to be responsible for his avoiding jail time.
The Saga of PokerStars in the U.S.
Although PokerStars is an internationally-known and legitimate business, it was not welcome in the U.S. Under Bush and Cheney, the Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA) targeted many forms of online gambling, including poker.
But PokerStars was one of the companies that continued to operate in the U.S.
And the federal government cracked down on them.
Hard.
Who was indicted?
The U.S. issued a document and went after 3 companies: PokerStars, Full Tilt, and Absolute.
But they also went after the individuals at the heads of these companies. The U.S. indicted 11 executives: Scheinberg, Raymond Bitar, Scott Tom, Brent Beckley, Nelson Burtnick, Paul Tate, Ryan Lang, Bradley Franzen, Ira Rubin, Chad Elie and John Campos.
This 201-indictment is known as Black Friday. Parlay cards online. And it made clear how seriously the U.S. takes what it regards as illegal, offshore companies.
Scheinberg's Arrest and Plea
Scheinberg was arrested in Switzerland in June 2019. Then in January he was extradited to the U.S.
He was 74 years-old when he first appeared before the judge in March 2020.
Part of the reason why Scheinberg was able to avoid prison was PokerStar's assuming the financial burden of Full Tilt Poker’s debts. These were considerable, including $184 million owed to non-US players.
Fine and Punishment
Scheinberg was fined $300,000. The time he would have served was viewed as already served since his 2011 indictment.
Isai Scheinberg's commentary
In response to the ruling, Scheinberg said, “I am pleased that Judge Kaplan has determined today not to impose a prison sentence in my case.'
He then went on to defend PokerStar's treatment of its players: 'PokerStars played an important role in creating today’s global regulated online poker industry by running an honest and transparent business that always treated its players fairly.
“I am particularly proud that in 2011, when PokerStars exited the US, all of its American players were made whole immediately. Indeed, PokerStars reimbursed millions of players who were owed funds from other online companies that could not or did not repay those players.”
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