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Online gambling is a hot-button topic in the United States. When it comes to poker, which many argue is a game of skill, the US government considers the game to be illegal.

The US government has been successful in pushing some of the online poker services out of the American market. For instance, it drove out PartyGaming and Playtech, both of which are publicly-traded in the UK, and collected a hefty fine from PartyGaming.

But that hasn't stopped some of the more aggressive companies from continuing to provide services to US players. That is, until yesterday, when The Poker Players Alliance reported that the US attorney for the Southern District of New York had three US-based banks freeze the accounts of Account Services and Allied Systems, two payment processing companies used by PokerStars and Full Tilt Poker to handle transactions with US-based customers.

According to The Poker Players Alliance, the total amount seized was $33m. That money belongs to as many as 27,000 players. The poker sites will apparently reimburse the players out of pocket. Ouch.

It's easy to look at yesterday's move as a non-event. After all, the US government's position on online gaming has been clear for some time and PokerStars and Full Tilt Poker clearly decided to take a risk in staying in the US market. So who outside of those affected should really care?

Well, if anything, this highlights just how easily government action can impact consumers and businesses on the internet. There is a push in the US for a more robust online sales tax regime and the EU is contemplating rules that could have a significant impact on many online businesses. Both of these things, if implemented, would likely make the $33m that was seized by the US government look like small potatoes.

So even if you don't care that the US government cleaned the table in a high-stakes poker match, the next hand you're dealt by government may be equally poor.

Photo credit: no prawns via Flickr.

Patricio Robles

Published 11 June, 2009 by Patricio Robles

Patricio Robles is a tech reporter at Econsultancy. Follow him on Twitter.

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Comments (1)

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DavidR

Actually they are bluffing... they are just hoping no one calls their bluff.  They are attempting to use an outdated law (applied incorrectly and somewhat inconsistently - think horseracing and fantasy football) but realize if they have to go to court they could lose which would set precedent.  They pray for settlements so there are not precedents.

about 7 years ago

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