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Kentucky’s spoiler role in PokerStars-FTP deal; payment processor forfeits $6m

TAGs: Black Friday, commonwealth of kentucky, Full Tilt, full tilt poker, lst financial inc., payment processor

kentucky-pokerstars-ftp-dealFor those of you who may have been asleep at the time and thus blissfully unaware, the online poker interwebz lost the plot Wednesday afternoon after one of the Twitterverse’s wannabe Jimmy Olsens claimed he had it on reliable authority that PokerStars had ‘folded’ its rumored deal with the US Department of Justice to acquire the assets of Full Tilt Poker (FTP) and make FTP’s former players whole. What’s more, he who shall remain nameless claimed Stars had never been serious about the deal in the first place; it had only been a cunning bluff to screw Groupe Bernard Tapie’s attempt to bring FTP back into the marketplace. However, this ‘scoop’ was soon quashed by ESPN’s Andrew Feldman, who relayed a message from Stars head of corporate communications Eric Hollreiser: “Twitter rumors of PS folding on the FTP deal is “false”. Seriously, when will this nightmare end? (And we don’t just mean the grammatically incorrect use of “is” where “are” belonged.)

In more concrete Black Friday-related news, a letter has surfaced from US Attorney Preet Bharara to Judge Leonard Sand, the black-robed guy overseeing the DoJ’s civil complaint against PokerStars, FTP and Absolute Poker. In the July 10 letter, Bharara asks Sand for extensions to the scheduling deadlines regarding FTP, FTP’s former CEO Ray Bitar and the Commonwealth of Kentucky (which filed its own forfeiture claim against FTP’s domain name last September, after claiming ownership of 141 gambling-related domains way back in 2008). Kentucky’s role in a potential FTP-to-PokerStars deal has largely been ignored up to now, and provides yet another hurdle to clear before a settlement can be concluded. Bharara sought a July 16 deadline for (a) FTP, Bitar and Kentucky to file a motion to dismiss and (b) the DoJ to file to strike FTP, Bitar and Kentucky’s claims. An Aug. 6 deadline for opposition to such motions was requested, while replies would be permitted until Aug. 13, all of which Judge Sand so ordered on Wednesday. And round we go…

Wednesday did bring closure to one Black Friday case. San Antonio, Texas-based payment processor LST Financial Inc. agreed to forfeit $6.27m to federal prosecutors for its role in aiding online poker companies indicted on April 15, 2011. LST was likely done in by Ryan Lang, one of the 11 individuals indicted on Black Friday, who pleaded guilty to tax fraud and UIGEA violations in February, for which he faces sentencing on Sept. 24. Redfall International, a Calgary, Alberta-based company 50% owned by Lang, utilized LST to process payments for PokerStars and other online poker outfits, although LST claimed Lang kept them in the dark as to these activities. As part of LST’s deal, the feds will return funds seized from LST accounts that were not connected to online poker processing. The Wall Street Journal reported that a North Carolina bank would receive $212k from the funds forfeited by LST to cover expenses incurred from unwittingly aiding LST’s poker processing activities.

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