PPA provides DoJ with recommended path to refund FTP players

[Skallagrim]

Originally Posted by tamiller866

....

Conversely, what FTP owes winning players is gambling winnings, which is a gambling debt, just as it would be if they were an underground card room in NYC where players were able to leave their winnings on account rather than cashing out when they leave.

I will try one last time. The money FTP owes us is not a gambling debt because you never, never, ever gambled with FTP. FTP did not sit at the table. FTP did not raise nor fold nor hit the 2 outer on the river that took your stack.

Lets try this example: you go to an illegal casino and hit a slot for $1,000. You take the $1,0000 and put it in a safe deposit box at your bank. Later you go to the bank and ask to go to the box. When you attempt to take the money out of the box the bank says you can't because it is "illegal gambling winnings" and the bank does not pay those. AFAIK, only you would defend the bank in this situation, everyone else would see quite clearly that the bank and you have not gambled and therefore the removal of your money is neither payment of a gambling debt nor payment of gambling winnings.

If the illegal gambling business was raided, showing your receipt to the DOJ wouldn't entitle a player to remission - regardless of any promises they may have made that your funds were segregated, but in this case the card room was in fact operating legally in Alderney, and only their accepting of deposits from US players is what violated Federal law.

You are completely forgetting (or possibly deliberately ignoring) the charge of FRAUD AGAINST THE PLAYERS.

If your hypothetical gambling business was raided, and part of its business was storing customers' money, and its managers lied about keeping the money separate and safe and instead took the money for hookers and blow, then once the prosecution discovered that fact it could bring an additional charge of theft (Fraud) against the illegal gambling business and the customers who lost money on deposit with that business would be victims of that theft/fraud.

And that has nothing to do with whether or not the customer is also a "victim" of illegal gambling or a co-conspirator to illegal gambling or whatever other construct regarding illegal gambling you wish to imagine next.

The same principles apply to remission in the FTP case.

Skallagrim

[Stinky Stu]

Thank you, as always, PPA.

[tamiller866]

Originally Posted by Skallagrim

I will try one last time. The money FTP owes us is not a gambling debt because you never, never, ever gambled with FTP. FTP did not sit at the table. FTP did not raise nor fold nor hit the 2 outer on the river that took your stack.

Lets try this example: you go to an illegal casino and hit a slot for $1,000. You take the $1,0000 and put it in a safe deposit box at your bank. Later you go to the bank and ask to go to the box. When you attempt to take the money out of the box the bank says you can't because it is "illegal gambling winnings" and the bank does not pay those. AFAIK, only you would defend the bank in this situation, everyone else would see quite clearly that the bank and you have not gambled and therefore the removal of your money is neither payment of a gambling debt nor payment of gambling winnings.



You are completely forgetting (or possibly deliberately ignoring) the charge of FRAUD AGAINST THE PLAYERS.

If your hypothetical gambling business was raided, and part of its business was storing customers' money, and its managers lied about keeping the money separate and safe and instead took the money for hookers and blow, then once the prosecution discovered that fact it could bring an additional charge of theft (Fraud) against the illegal gambling business and the customers who lost money on deposit with that business would be victims of that theft/fraud.

And that has nothing to do with whether or not the customer is also a "victim" of illegal gambling or a co-conspirator to illegal gambling or whatever other construct regarding illegal gambling you wish to imagine next.

The same principles apply to remission in the FTP case.

Skallagrim

I'll try not to use the term 'gambling debt' since that seems to have caused some mental block to form in your thought process, but just why do you think 'someone else at the DOJ' (per Ifrah) had a problem with paying out 'gambling winnings'?

Do you really believe that they have some concern over committing a UIGEA violation? Yet paying back deposits from a gambling site would not be in violation?

Don't bother reading any further if the answer to that rhetorical question was yes, obviously the concern over paying winnings (and/or not remitting losses) is that it would legitimize the business that they are calling illegal in their indictments.

AFLMS needed to be advised that they could have their cake and eat it too, that an online poker site could be breaking US laws in it's promotion of gambling and solicitation of deposits while the gambling itself could still have occurred in a remote licensed online cardroom.

Instead the PPA just regurgitated the SDNY position that US customers are fraud victims, leaving it to AFMLS (though it appears we may get lucky as they have delegated SDNY the responsibility of hiring an administrator) to decide whether the fraud delegitimized the games since the money wasn't there, whether even if the money was there would returning winnings from an 'illegal gambling business' set a bad precedent for future illegal gambling forfeiture proceedings (especially B&M), or if they pay based on balances could the courts have to decide whether losing players could recover winning players' remission.

The goal of any remission or restitution process is to restore the victims back to the pecuniary position which they would have been in had they never had contact with the fraudster, if AFLMS adopts that position in this process, players will be refunded based on deposits alone.

The PPA was granted the opportunity to state a position which SDNY is unable to make, that players should be restored to their position had the fraud itself not occurred, because the gambling itself was lawful in the jurisdiction in which it occurred, meaning that deposits to player accounts from the tables are actually even more legitimate that deposits accepted from the US in violation of the UIGEA.

[Skallagrim]

Tamiller (and this is my last post on the subject):

The fraud FTP committed against the players was telling us that our account balances were safe and secured when in fact they were being used by FTP to fund FTP operations and pay dividends.

Had that fraud not occurred, FTP would have paid players the amount of their account balances when they had the chance to do so after BF. AND THAT IS EXACTLY WHAT THE PPA IS SAYING TO THE DOJ.

The remission process is not about restoring folks to the position they would have had had they never met the fraudster, you just made that up out of thin air.

The remission process is about restoring to folks to where they would have been had they not been defrauded.

The worry about paying "illegal gambling winnings" is a red herring thrown out by people who love to scare others. "Illegal gambling winnings" is not a term used in Federal law. "Illegal gambling proceeds" is the correct term and it is not concerned with winnings or losses. If the DOJ thought player funds where "illegal gambling proceeds" then there would be no remission process at all and the DOJ would simply keep all the money.

And that's it. Someone else will have to take over responding to your novel and creative theories based on 1/2 truths and inconsistent use of terminology.

Skallagrim

[zerosum79]

Are we going to get an update when the second letter regarding 3rd party repayment is sent?

zero

[Skallagrim]

Originally Posted by zerosum79

Are we going to get an update when the second letter regarding 3rd party repayment is sent?

zero

Yes.

But it is not ready yet.

Skallagrim

[tamiller866]

Originally Posted by Skallagrim

Tamiller (and this is my last post on the subject):

The fraud FTP committed against the players was telling us that our account balances were safe and secured when in fact they were being used by FTP to fund FTP operations and pay dividends.

Had that fraud not occurred, FTP would have paid players the amount of their account balances when they had the chance to do so after BF. AND THAT IS EXACTLY WHAT THE PPA IS SAYING TO THE DOJ.

The remission process is not about restoring folks to the position they would have had had they never met the fraudster, you just made that up out of thin air.

The remission process is about restoring to folks to where they would have been had they not been defrauded.

The worry about paying "illegal gambling winnings" is a red herring thrown out by people who love to scare others. "Illegal gambling winnings" is not a term used in Federal law. "Illegal gambling proceeds" is the correct term and it is not concerned with winnings or losses. If the DOJ thought player funds where "illegal gambling proceeds" then there would be no remission process at all and the DOJ would simply keep all the money.

And that's it. Someone else will have to take over responding to your novel and creative theories based on 1/2 truths and inconsistent use of terminology.

Skallagrim

Thin air: http://www.justice.gov/usao/briefing...ing_money.html

The purpose of restitution is to put you in the same position financially that you were in before the crime was committed.

Your loss for restitution purposes is ... not more or less than what you actually invested.

Why would they keep all the money if they believe depositors were victims of fraud?

The issue of returning winnings isn't a 'red herring' I created, it was a concern raised by someone within the DOJ during negotiations according to one of the attorneys involved in the negotiations.

It is a very real concern, the only actual concern that needed to be addressed by the PPA, as SDNY had already chosen to treat FTP customers as fraud victims before the PPA said anything.

I don't need to regurgitate all of the reasons DoTheMath posted in another thread as to why AFLMS might choose to base remission upon deposits when restoring victims to the place they were prior to the fraud, but without an argument as to the poker having been specifically authorized in the jurisdiction where it was played, players are left in the same position they would have been had the PPA said nothing at all.

Which just baffles me, the PPA and you specifically have beat the dead horse of online poker not being in violation of any Federal law for years, but the one time the PPA decides not to voice that position is the one time when that argument could actually be useful to the players.

[Go Get It]

Originally Posted by Skallagrim

Yes.

But it is not ready yet.

Skallagrim

Also, will this letter at least include a discussion about Points balances/admin fees that players may have to cover?

And does the PPA have an official processor that they will recommend to the DOJ?

[TheEngineer]

Originally Posted by tamiller866

Thin air: http://www.justice.gov/usao/briefing...ing_money.html


Why would they keep all the money if they believe depositors were victims of fraud?

The issue of returning winnings isn't a 'red herring' I created, it was a concern raised by someone within the DOJ during negotiations according to one of the attorneys involved in the negotiations.

It is a very real concern, the only actual concern that needed to be addressed by the PPA, as SDNY had already chosen to treat FTP customers as fraud victims before the PPA said anything.

I don't need to regurgitate all of the reasons DoTheMath posted in another thread as to why AFLMS might choose to base remission upon deposits when restoring victims to the place they were prior to the fraud, but without an argument as to the poker having been specifically authorized in the jurisdiction where it was played, players are left in the same position they would have been had the PPA said nothing at all.

Which just baffles me, the PPA and you specifically have beat the dead horse of online poker not being in violation of any Federal law for years, but the one time the PPA decides not to voice that position is the one time when that argument could actually be useful to the players.

Your avatar disagrees: http://www.pokerplayernewspaper.com/...-america-12334

[tamiller866]

Originally Posted by TheEngineer

Your avatar disagrees: http://www.pokerplayernewspaper.com/...-america-12334

Not really, I agree with her that it is a compelling argument and said so when it was already made by SDNY, but had it been combined with the standing argument that the PPA has been making the past six years which SDNY can't make themselves (that online poker doesn't violate Federal law) it would have been much more compelling.

[northeastbeast2]

How could you have gambled if there is no consideration? This money you are getting is an approximation of the money that was wiped out when Full Tilt Poker collapsed. Your account balance and transactions records are being used as a reference to determine how much should be paid to you. You are not actually being paid the money in that account.

The only way that they could show continuation of your account and account balance would be if they were forced to pay you by law. In this situation they do not actually have to pay you.

So they have two choices they could make.

1. They could keep the money on behalf of the United States and its citizens.
2. They can direct the compensation to specific US citizens

If they decided to do option 1 would you have tax liability as the result of them deciding to keep the money for the United States?

If they decide to direct the money to specific US citizens they have full discretion in how they choose to distribute that money also. Even if that compensation exactly matches your previous transaction history on Full Tilt Poker it would impossible to prove why the DOJ decided to compensate you.

I'm saying that because they have the option of not paying you and keeping the money on behalf of the United States itself that directing money toward specific people does not make it taxable.

The only way it could become taxable would be if the United States government claimed it as revenue first then distributed it. If it is never legally possessed by them as revenue to the Treasury the distributions themselves cannot become taxable until they pass on from whomever they are distributed to and result in private transactions.

[LT22]

What did I just read? Cliffs notes?

[Go Get It]

Originally Posted by Go Get It

Also, will this letter at least include a discussion about Points balances/admin fees that players may have to cover?

And does the PPA have an official processor that they will recommend to the DOJ?

?

[tamiller866]

I was completely befuddled upon reading that the PPA Path to refund players included no mention of the tried and true PPA argument that online poker is not illegal, having been out of contact with the world for a week do to flooding here in the Philippines.

Then today I got a link to this article on twitter: http://hardboiledpoker.blogspot.com/...ght-fight.html

Which linked to this John Pappas OP-Ed that was published while I was offline: http://www.forbes.com/sites/realspin...-online-poker/

Which makes it now clear to me why the PPA chose not to make a legal argument for online poker play: Pappas insinuates that the DOJ themselves have declared that online poker is not illegal, and that they (the DOJ) are trying to send a message to Congress that it is time to regulate online poker.

Which inspired one respected attorney/poker player/blogger to wonder Did Pappas and the PPA Just Shoot Full Tilt Players in the Foot?

I realize that the primary focus of the PPA is on getting legislation favorable to their benefactors pushed through congress, but on this one occasion I had hoped that politics could be put aside to do what was in the best interests of the players.

But no, the PPA chose to use this occasion as just another phase in their legislative chess game in which the players are the pawns, and risked upsetting the DOJ who has shown clear indication of a desire to make players whole for the chance to seize the tiniest of political capital.

I could write an a detailed rebuttal on why the argument that the DOJ was somehow granting their approval of online poker by reaching a settlement with PS/FTP is in no way beneficial to getting legislation passed, but that would just be dignifying the fact that the PPA ever attempted to make the argument at even the slightest risk of players not being fairly refunded.

[jackaaron2012]

Let's say that what gets paid out is only whatever you put in. For example, you put on 1,000, you ran it up to 80,000, but you get paid 1,000.

Is it possible that a player would sue the DOJ using the idea that all the money they won was theirs, and they were doing nothing illegal when they won it? I guess the question is could the DOJ have lawsuits on their hands if they don't pay back in full?