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Guilty plea entered in NY online poker case

Guilty plea entered in NY online poker case

March 27th, 2012 by LARRY NEUMEISTER, Associated Press in News

NEW YORK (AP) - One of two men nearing trial in a case that shut down U.S. operations for three Internet poker companies has admitted he conspired with others to deceive U.S. financial institutions so they would process hundreds of millions of dollars in gaming transactions.

Chad Elie, of Las Vegas, entered the guilty plea Monday in U.S. District Court in Manhattan to a count of conspiracy to commit bank fraud and to operate illegal gambling businesses. The plea came as the money processor was scheduled to go to trial April 9 along with former bank executive John Campos, who has asserted his innocence.

A prosecutor said the government will likely know within days whether Campos intends to go to trial.

A plea deal reached between prosecutors and Elie, 32, recommends a sentence of six months to a year in prison for him. He is scheduled to be sentenced Oct. 3. He also agreed as part of the plea to forfeit $500,000 within two months, along with his interest in more than $25 million held in payment processing accounts in the United States and abroad.

Elie and Campos were the only men headed to trial after others among a dozen people charged in the Internet gambling case reached plea agreements or remained fugitives.

Prosecutors have sought $3 billion in money laundering penalties and forfeiture after targeting three companies based overseas: PokerStars, Full Tilt Poker and Absolute Poker. Elie admitted serving as a payment processor for all three companies at various times from 2008 through early 2011.

The government said Elie and others created phony corporations and websites to disguise payments to the poker companies.

Elie admitted as part of his plea that he had deceived one bank into processing online gambling proceeds by saying the money moving through accounts was the result of businesses unrelated to gambling. He said that when the bank later questioned the revenues: "I denied the account was being used for online gambling transactions."

Full Tilt Poker has defended its executives and said it has suspended play for real money on its website in the United States but would continue offering gambling on poker in other countries.

Absolute Poker said it would continue its U.S. operations because "the U.S. Congress has no control over" its payment transactions, authorities say.

PokerStars said it has had to suspend real-money play to customers based in the United States.