Category Archives: Legal

Absolute Poker/Ultimate Bet Reimbursement

[LL] “You know what the biggest surprise this week was?” Leroy the Lion asked.

[FF] “That you’ve already filed your taxes?” Figaro the Fish suggested.

[LL] “That was certainly the old, procrastinating me, schlepping my tax forms to the post office and waiting in an hour-long line on the last day. But I’ve reformed, and I already submitted electronically last week; I would have done it even sooner if I was getting a refund.”

[RR] “That Le Grand Orange1 hasn’t started World War III yet?” Roderick the Rock postulated.

[LL] “No, that’s less surprising with each passing week. And I’m pretty sure the rest of the world is afraid of what a crazy man with access to nuclear launch codes is capable of.”

[FF] “That United Airlines dragged that poker-playing doctor off a plane because it wanted four crew members to get on the flight instead? That was crazy.”

[LL] “Not that surprising though. Airlines have a long history of treating passengers like cargo and cash cows. Clearly, they should have kept increasing their buyout offer until enough passengers accepted. Penny-wise, pound-foolish. $800 was nothing to David Dao, who’s had two dozen tournament cashes for more than that and has spent $10,000 to play in the WSOP Main Event. Even a few thousand dollars now is trivial compared to the amount of business United will end up losing.”2

[SS] “That Absolute Poker was in the news,” Stan the Stat declared, “and good news at that.”

[LL] “Yes, that’s what I was thinking about. I’m absolutely amazed there was any possibility after six years that players would get their money back from Absolute Poker and Ultimate Bet!”

[RR] “It seems foolish to have had more than a little money on those sites after the cheating scandals, but I suppose if the games were profitable, it was just another gamble they took.”

[LL] “More than a little money. The Department of Justice thinks about $60 million could be returned. That’s more than half of what players got back from Full Tilt Poker.

Anyway, you can tell people to head over to AbsolutePokerClaims by June 9 and fill out the forms once they’re available.”

[RR] “It’ll be like finding money in the seat cushions.”

[SS] “More like getting back a wallet full of money. But when do you ever get something back after you’ve lost it for six years?”

[LL] “It’s been so long, there’s a section in the FAQ on dead money — money due to players who have passed away in the meantime.”

Footnotes:

  1. Le Grand Orange was Rusty Staub’s nickname, so I’m kind of sad to see it reused, as he was once one of my favorite baseball players.
  2. United Airlines stock at least temporarily dropped a billion dollars in market value. And the word “re-accommodate” will certainly be used sarcastically from now on; e.g., “If you’d be so kind as to call, I’d happily re-accommodate some of your chips into my stack here.”

Related Links:

Tags:
Categories:

Daily Fantasy Sports vs. Online Poker

[RR] “What do you guys think of DFS?” Roderick the Rock polled.

[LL] “I assume you aren’t talking about Distributed File Systems?” Leroy the Lion joked.

[RR] “Daily Fantasy Sports, of course.”

[FF] “It’s just like online poker,” Figaro the Fish opined. “I keep losing all my money there, too.”

[YY] “It’s just like online poker,” Yuri the Young Gun agreed. “I keep making a nice little profit off people like Figaro, who treat the game more like a lottery than an exercise in analysis.”

[RR] “Have you stopped playing online poker then?”

[YY] “Pretty much. I missed the early days of online poker because I was too young, but I got in early enough this time.”

[LL] “Early enough to make some money before government regulation kills it?”

[YY] “And early enough that most people have no idea how to play well. Although there are too many sharks for me to make a lot of money, at least I can get my money safely in and out when I want to.”

[RR] “More than a few of those sharks are former poker pros, like Aaron Jones, Andy Frankenberger, Assani Fisher, Dan Smith, Matt Smith, Max Steinberg, Mike Leah, Ray Coburn, Steven Silverman, Tom Crowley, and Tony Dunst.”

[LL] “Dan Bilzerian and Jason Somerville advertise for DraftKings, and Jonathan Aguiar works there.”

[RR] “Brett Richey and Eric Liu created BlitzPick to sell fantasy data to mobile DFS players.”

[LL] “And even Phil Ivey is throwing his hat into the ring. PhilIveyDFS is supposed to launch next month.”

[YY] “Not surprising at all. The similarities between online poker and DFS are all over the place:

  • You play against other players, not the house, which happily collects its rake.
  • Large player pools turn relatively small buyins into big prizes.1
  • The buyins range from freerolls to entry fees of thousands of dollars.
  • The variety of events is very similar, including big tournaments, sit and gos, 50/50 games, head-to-head contests,2 and qualifiers.3
  • Guaranteed prize pools in some events can backfire, causing an overlay if not enough people enter.4
  • A large luck component means that anyone can win any given tournament.
  • A large skill component means the best players will win the most in the long run, and most players will be losers.
  • Knowing the odds is very important even if many players just go with their gut feel.
  • Both industries boomed with the help of amateurs winning big prizes.
  • Both survived scandals,5 at least for a while.
  • Both were unregulated at first, but once they became big enough, the government jumped in.”6

[LL] “And there are two dominant companies in the U.S.; New York-based FanDuel and Boston-based DraftKings are like PokerStars and Full Tilt Poker. On the other hand,

  • In DFS, you do all your work before an event begins; once lineups are locked, all you can do is root for your athletes to do well. In poker, you have to select your table properly, but every hand presents new challenges for you to solve. A tournament continues for you as long as you still have chips.
  • Poker has a large social component. Even online poker has chat boxes to communicate with other players. Of course, it makes more sense to talk to players while you can still affect a game.
  • It helps to know your opponents, but in very different ways. In poker, if you can figure out how your opponents are playing, you can adjust on the fly to take advantage. In DFS, you score big by picking the undervalued players that others haven’t found (at least, you need more of them in your lineup than anyone else).
  • In online poker, better players and worse players generally don’t play in the same tournaments (separated by buyin amount). In DFS, the pros might enter every contest they can.7
  • At a U.S. federal level, fantasy sports is defined and exempted by the Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA), which ultimately doomed online poker.8

[RR] “I’d still say they’re more similar than different, at least in terms of how the government should deal with them.”

[YY] “I’d rather play online poker than DFS, but I’d also rather have just DFS than neither!”

[LL] “It’s time for someone to create a poker DFS site. ESPN has, or at least had, a Fantasy WSOP Draft since 2006. There’s no reason it can’t be done on a weekly basis.”

[RR] “Just because it can be, doesn’t mean it should. Let’s just bring online poker back legally!”

Footnotes:

  1. A $1 million first prize was briefly the Holy Grail, but Aaron Jones just won $5 million in the DraftKings Fantasy Football World Championship.
  2. 50/50 and heads-up events are the grind-it-out-cash-games of DFS.
  3. The prizes in qualifiers are entries into a higher buyin tournament.
  4. Ed Miller analyzed some DFS baseball and found that 1.3% of the players won 91% of the prizes, while 85+% of players lost money.
  5. A DraftKings employee, Ethan Haskell, prematurely released percentage-used statistics the day he won $350,000 in a FanDuel contest.
  6. Black Friday shut down the three biggest internet poker sites in the U.S. on April 15, 2011, while states began banning DFS in 2015 (Nevada on October 15, New York on November 10 [granted a stay on appeal though], Illinois on December 23, and Texas on January 20, 2016).
  7. Both DraftKings and FanDuel have begun to create separate tournaments for beginners only, but so far there haven’t been any beginner-only tournaments with big prizes.
  8. Andy Frankenberger summed up the irony, “It’s a joke that between online poker and daily fantasy, poker is the one that’s widely prohibited in this country. Anyone who thinks poker is not a game of skill probably hasn’t played much poker.”
Tags:
Categories:

Full Tilt Poker Bankroll Reimbursement Wrap-Up

[LL] “I’d almost given up”, Leroy the Lion began. “After three years and three months, and a full month after the last promise, my Full Tilt Poker bankroll has finally been returned! I didn’t get an email, but I happened to check my bank account online and saw this lovely line:”

Deposit – ACH DOJ POKER STARS / – POKERPAY01 Payment in connection with the Full Tilt Poker Claims Administration1

[SS] “I got mine too”, Stan the Stat seconded. “Wasn’t much, and I’d really rather keep it somewhere where I could play online poker!”

[LL] “There are still sites that let you play in the U.S.”

[SS] “And risk losing my bankroll again? Too bad we don’t live in Nevada, New Jersey, or Delaware, where online poker returned legally last year.”2

[LL] “I think you’d be disappointed. Before, you could play with anyone in the world. Now, the player pools are so small that the game selection is terrible. Nevada and Delaware residents can play against each other, but they’re only the 35th and 45th most populous U.S. states, with less than four million people total. New Jersey is a little better but still has under nine million residents.”

Footnotes:

  1. ACH is short for “Automated Clearing House”, an electronic banking network. DOJ is the “Department of Justice”. PokerStars bought Full Tilt Poker on July 31, 2012.
  2. Nevada legalized online poker on April 30, 2013, Delaware half a year later, and New Jersey another month later. See the legality section of the Wikipedia article on online poker.

Related Links:

Tags:
Categories:

Taxes Hold ‘Em

[LL] “Since you guys are here playing poker, I assume you’ve all filed your taxes already?” Leroy the Lion suggested, less than rhetorically.

[RR] “Sure, I usually do them as soon as I get my W-2 and all my 1099-DIVs and INTs and whatnot”, Roderick the Rock confirmed. “No reason to wait if I’m getting a refund.”

[SS] “I’m almost done”, Stan the Stat declared. “Definitely needed this break, in any case. How about you?”

[LL] “Starting on them tomorrow. I procrastinate every year, but at least I don’t have to run to the post office anymore, thanks to online filing.”

[RR] “Have you ever needed an extension?”

[LL] “Trust me, I’ve considered it many times, but that would be yet another form1 to fill out! My vice of laziness is stronger than my bad habit of procrastinating.”

[SS] “Speaking of taxes, I wonder how many poker players didn’t request their Full Tilt Poker funds back because they were sure the IRS would realize they hadn’t paid taxes on their winnings over the years.”

[RR] “I’m sure a lot of people with under $100 dollars there wouldn’t risk it. Maybe a thousand dollars, ten thou, or more even.”

[SS] “Basic expected value calculation: the chances of getting audited times the owed taxes and penalties versus the amount in the FTP account.”

[RR] “The IRS hasn’t publicly admitted anything, but supposedly they’re not involved with the payouts.”

[SS] “Legally, these payouts are exactly the same as anytime you withdraw money from an online poker account. The tax implications come when you win and lose money in games, not when you deposit and withdraw.”

[LL] “Ever the optimist, I paid my taxes on my Full Tilt Poker winnings, even for 2011,2 since I expected to get my bankroll back.”

[RR] “If you’re an optimist, why didn’t you not pay the taxes and assume the IRS would never audit you.”

[LL] “I’m a sole proprietor, so I’m already cruising down audit highway in a bright red sports car. And it especially sucks to live in Massachusetts, one of four states3 where you can’t deduct your gambling losses. And that’s not even net. If you have five winning sessions and six losing sessions, Massachusetts only cares about those five wins.”

[RR] “Unless you file your taxes as a professional poker player.”

[LL] “Exactly, but none of us play enough poker to move it out of the hobby category. Well, except maybe Yuri back in his online poker heyday.”

Footnotes:

  1. For individuals, Form 4868 will automatically get you another six months to file your taxes. You still need to pay estimated taxes in April though if you owe.
  2. Legally, nobody had to pay taxes on their 2011 Full Tilt Poker winnings since there was no “constructive receipt”. That would be the once case where taxes would be owed when the FTP funds were returned in 2014.
  3. Massachusetts, Connecticut, Illinois, and Ohio specifically don’t allow deducting your gambling losses as a hobbyist. Some states have no income taxes (AK, FL, NV, SD, TX, WA, and WY as of 2014); others only tax dividends and interest (NH and TN as of 2014); the remaining states allow you to deduct your gambling losses like the U.S. government does.

Related Links:

Tags:
Category:

Full Tilt Reimbursement!

[RR] “I got my Full Tilt money back!” Roderick the Rock exclaimed.

[LL] “Congratulations!” Leroy the Lion responded. “You see the money in your bank account now?”

[RR] “Yep. I got this email last Tuesday:”

Dear ftpCustomer:

The purpose of this email is to inform you that your Petition for Remission has been approved and you are entitled to receive a distribution from the assets forfeited in connection with United States v. PokerStars, et al., pending in the United States District Court for the Southern District of New York.

A payment in the amount of $amount will be paid electronically via ACH to the bank account that you specified in your Petition. This payment represents the full amount of your Full Tilt Poker Account Balance, which you confirmed on the Full Tilt Poker administration online filing site. Payment will be made within the next seven business days.

If you have any questions, you can call us toll-free at (866) 250-2640, email us at info@FullTiltPokerClaims.com, or write to us at Full Tilt Poker Claims Administration, c/o GCG, P.O. Box 9965, Dublin, Ohio 43017-5965. For additional information you may also visit the administration website at www.FullTiltPokerClaims.com.

[RR] “Then I checked my bank account on Friday and there it was!”

[LL] “I guess I’m officially worried then. I didn’t get an email one way or the other, and of course that means nothing got sent to my bank account.”

[RR] “Have you called them?”

[LL] “I emailed and am waiting to hear back. I’m not an affiliate or a Full Tilt Poker Pro, and I got a confirmation for my petition in September, so I don’t know what happened.”

{A day later…}

[LL] “I didn’t get any response to my email (big surprise), but (bigger surprise) when I called their toll-free number, I was only on hold for a minute when a real, live honest-to-goodness American-accented human being picked up.”

[RR] “Wow.”

[LL] “After confirming my petition number, name, and address, he gave me some bad news. My account balance was zero.”

[RR] “Uh oh. Someone managed to steal your balance?”

[LL] “After the recent Bitcoin fiasco, the thought crossed my mind. But the agent on the phone was completely calm when he said he’d search their database for my name.”

[RR] “And certainly there weren’t any other Leroy the Lions playing on Full Tilt!”

[LL] “Nope, just me. And somehow I’d managed to create two petitions, one with bank info but no balance; the other with the balance but no bank info. I finished filling out the petition that had a balance, and I hope to get paid in the second wave.”

[RR] “When will that be?”

[LL] “The agent didn’t know. But there’s plenty of money left in the fund, so I’m not worried. Just have wait a little longer.”

[RR] “After almost three years, what’s another few months?”

Tags:
Categories:

Full Tilt Poker Bankroll Reimbursement

[RR] “One term I would have added to your list of poker terms: Dead Money”, Roderick the Rock suggested. “It’s money put into the pot by players who have since folded, or it can mean a weak player.”

[SS] “It also describes my Full Tilt Poker account balance”, Stan the Stat bemoaned.

[RR] “You didn’t get an email from them this week about getting your money back?”

[SS] “Nope. This is really happening?”

[RR] “Yep. You can file your claim now (note that you may need to add a zero in front of your petition number). Even if you didn’t receive an email, you can refile your petition at the web site fulltiltpokerclaims.com (click File a Petition for Remission on the left sidebar then tap the “Create a New Petition” button near the bottom).”

[SS] “I guess I need to refile then. Maybe I entered the wrong email address or something.”

[RR] “You have until November 16, 2013, so don’t worry too much about it yet.”

[SS] “So that took six months. Probably another six months to see the money. Any word on whether the U.S. government will be looking into tax issues?”

[RR] “I don’t think they’re going through Full Tilt’s records, but this money will be treated as income by default. Different rules apply for pros and amateurs, but I suspect many players will be doing battle with the IRS over this next year.”

Tags:
Categories:

Full Tilt Poker Reimbursement Progress

[YY] “Hey, did you guys hear that the U.S. Department of Justice finally selected a claims administrator for reimbursing our Full Tilt Poker balances?” Yuri the Young Gun asked excitedly.

[FF] “Awesome. I can get my $2.14 back at last!” Figaro the Fish quipped sarcastically.

[LL] “I had most of my poker bankroll on there, so for months I regretted not withdrawing my money after the poker legislation failed the December before Black Friday. All the signs were there, but I was having too much fun to stop playing”, Leroy the Lion added more seriously.

[YY] “The process hasn’t started yet, but for future reference you can bookmark http://www.fulltiltpokerclaims.com/index.php, which currently says little more than, ‘The Garden City Group, Inc. has been retained to serve as the Claims Administrator of the funds forfeited in U.S. v. PokerStars, et al.’

[YY] “There’s a link near the bottom to sign up for an email notification when more information is available. You can also call the toll-free number 866-250-2640 from Monday through Friday, 8 a.m. to 6 p.m. EDT, for more information.”

[SS] “You can remember the phone number as ‘tomb l0an h0′”, interjected Stan the Stat.

[LL] “Indeed. I hope they pay us some interest on the loans we unintentionally gave them!”

[TT] “Sure thing! And you also believe in the Easter Bunny, / The Tooth Fairy, the Great Pumpkin, and Santa Claus / That trees grow with branches of gold and leaves of money / And luck comes from four-leaf clovers and dead rabbits’ paws”, Tyrone the Telephone insinuated.

Related Links:

Tags:
Categories:

Mayor May Not

[RR] Roderick the Rock was always up on current events, especially any news that related to gambling. “Did you hear that the former mayor of San Diego, Maureen O’Connor, was so addicted to video poker that she lost over $13 million over the course of a dozen years, helping to drain her once $40+ million dollar fortune, and eventually resorted to embezzling money from a nonprofit organization that she was a trustee of?” he inquired of the group.

[TT] “How did San Diego twice elect / a woman of judgment so suspect?”, Tyrone the Telephone asked in response.

[SS] Stan the Stat countered, “Politicians aren’t exactly known for their brains. Charisma, yes. Intelligence, no.”

[RR] “O’Connor was beyond addicted. Video poker basically became her life as she tried to fill the void left by the death of her husband1 and some other family and friends. She reported losses, mostly offset by gains, of over a billion dollars. She didn’t need the money (well, not at first), so she’s not like a lot of regular Megabucks lottery players who dream of striking it rich.”

[AA] “The lottery’s just a regressive tax on the probabilistically challenged”, Al the Almost noted.

[SS] “That’s true of the smaller games, where you can only win a few hundred dollars. But everyone has a utility curve, and Megabucks and the other large games offer life-changing money. It’s really the only way some people will ever get that rich. Unlikely but still more likely than some random guy who likes to sing in the shower winning American Idol. The same thing goes for people who play Keno and slot machines.”

[RR] “There’s also the entertainment factor. Ten dollars may well be worth it to be able to dream of a million dollars for a few days. And the excitement. Video poker, Keno, and slots are all designed to pay off periodically, giving the gambler a brief ‘fix’ and luring them back for more.”

[TT] “So the states all willfully tax / The shirts on their residents’ backs / Passing slot and lottery acts.”

[RR] “Which is why online poker will be legalized soon enough. Once the U.S. and state governments figure out how to get their share of the action, the doors will be swung wide open.”

[SS] “Absolutely. Poker should never have been included in the Unlawful Internet Gambling Enforcement Act of 2006 in the first place. There’s a huge difference between completely luck-based, guaranteed-loss-in-the-long-run ‘gambling’ like lotteries2, and skill-based games like poker. Most amateur poker players are trying to improve their skills and make the game a profitable way to have fun. While professional poker players know that if they manage their bankrolls properly and select their games well, they’ll never need to find a 9-to-5 job.”

[RR] “It’s just not right when video poker, where no amount of skill will make you a long-term winner, is legal in over half of our states, but online poker is illegal in all fifty.3

[TT] “The ex-mayor may not have stolen the money / ‘Just a zero-percent interest loan, honey’ / Our cloudy laws are certainly a bit funny / ‘Til online poker returns to make it sunny.”

Footnotes:

  1. Her husband, Robert O. Peterson, founded the Jack-In-The-Box restaurant chain.
  2. Unless a state messes up, like Massachusetts did with its Cash WinFall game.
  3. Nevada and Delaware may soon become the first to legalize online poker, creating a small multi-state player pool similar to how our multi-state lotteries work.
Tags:
Categories: