Latest Arrests Should Have Little Impact Upon Online Poker Community

At first glance, the charges lodged against a number of individuals running a payment solutions company with tie-ins to online poker and sports betting, seemed like another death blow against an industry already at the end of their tether.

A closer look reveals something different entirely. To put it bluntly: a bunch of dumbasses processing online gambling payouts in UTAH.

There is no hypocrisy when it comes to the state of Utah. They don't allow gambling in any form, not even state lotteries. So it struck us as beyond bizarre that any company would select Utah as a state in which to process money for online gambling websites.

"This will have no affect on our operations."

The U.S. attorney for Utah on Friday announced charges against various individuals and companies involved in the processing of payments for online gambling operations.

The defendants live in Las Vegas, but two of the companies involved were based in Draper, a Salt Lake City suburb, according to the indictment.

"We now have a body of information technology and strategy that can cross many jurisdictions," U.S. Attorney Brett Tolman said at a news conference.

The indictment claims banks issuing Visa and MasterCard credit cards were fooled into processing Internet gambling charges. Defendants also channeled Western Union wire transfers through the Philippines.

The 34-count indictment includes charges of racketeering conspiracy, bank fraud, transmission of wagers and money laundering.

The first company, CurrenC and CurrenC Worldwide, based in other countries including Korea, Jamaica and the United Kingdom, processed most of the credit card and wire transfers. But two companies, Hill Financial Services and Gateway Technologies, based in Utah, and are accused of providing accounting and technical services for the illegal business and were used to track transactions, Tolman said.

While only four online gambling companies are mentioned in the complaint, Gambling911.com has learned that at one point or another more than half the online poker and gaming firms utilized CurrenC. It is widely believed that CurrenC ceased dealing with Internet gambling firms following the passage of UIGEA (Unlawful Internet Gambling Enforcement Act) in October. One company mentioned in the complaint, BetonSports, has been out of business for nearly a year now.

For online poker and other gaming companies that may have used CurrenC and its affiliated companies, they are claiming business as usual.

"This will have no affect on our operations," said one operator who wished not to be identified.

The indictment seeks to recover $150 million from the defendants as well as real estate, vehicles and other assets under RICO, the federal Racketeer Influenced and Corrupt Organizations law.

None of the defendants is in custody, but all are scheduled to appear in U.S. District Court in Salt Lake City on May 30.

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Christopher Costigan, Gambling911.com

Originally published May 12, 2007 11:49 am ET