on JANUARY 17, 2012

http://www.northcountrygazette.org/2012/01/17/poker_processor/

NEW YORK—A payment processor for the Internet gambling industry has pleaded guilty  to money laundering, bank and wire fraud, and gambling offenses in connection with a scheme to deceive U.S. banks into processing hundreds of millions of dollars in online poker transactions.

Specifically, prosecutors say Ira Rubin helped process payments for three of the largest Internet poker companies—Pokerstars, Full Tilt Poker, and Absolute Poker—by disguising transactions so that they would appear to be on behalf of non-gambling merchants selling clothing, jewelry, sports equipment and other items.

Rubin, a U.S citizen who had been residing inCosta Ricasince 2008, was detained in Guatemala on April 26, 2011, and then transferred to the United States.

In late 2006, Congress enacted the Unlawful Internet Gambling Enforcement Act (“UIGEA”), which made it a crime to “knowingly accept” most forms of payment “in connection with the participation of another person in unlawful Internet gambling.” After several Internet gambling businesses withdrew from the U.S. market following the passage of UIGEA, Pokerstars, Full Tilt Poker, and Absolute Poker became the top three Internet poker operators continuing to do business in the United States. BecauseU.S.banks were largely unwilling to process Internet gambling payments, companies turned to third party payment processors, including Rubin, who were willing to disguise the payments so they would appear to be unrelated to Internet gambling.

For example, in mid-2008, Rubin, together with co-conspirators, created dozens of phony e-commerce websites purporting to sell everything from clothing and jewelry to golf clubs and bicycles. In reality, these sites were used to disguise Pokerstars’ online poker transactions. Between 2008 and March 2011, Absolute Poker also used Rubin at various times to process echecks disguised as, among other things, payroll processing, affiliate marketing, and online electronics merchants.

Rubin committed the charged offenses while inCosta Ricawhere he has been living since 2008.

Rubin, 53, pleaded guilty to one count of conspiracy to violate the unlawful Internet Gambling Enforcement Act, one count of conspiracy to commit bank and wire fraud, and one count of money laundering conspiracy. He faces a maximum sentence of 55 years in prison. He is scheduled to be sentenced by U.S. District Judge Lewis A. Kaplan on May 17.

Four other defendants charged with Rubin have appeared in theUnited States: Bradley Franzen, Brent Beckley, Chad Elie, and John Campos. Franzen pleaded guilty on May 23, 2011, andBeckleypled guilty on Dec. 20, 2011.

Elie andCamposare scheduled to go to trial before Judge Kaplan on April 9.

The remaining six defendants charged in the superseding indictment are at large.