Remission of FTP funds and the PPA

[baadgerman]

fwiw...America's Cardroom (which used to be Doyle's Room) currently makes the same claim:

http://www.americascardroom.eu/play-...or-real-money/
We take your poker account extremely seriously
We know that’s what’s nside your poker account is incredible valuable to you. That’s why we keep all poker account balances in segregated accounts that are never used for operational expenses. It’s a system that guarantees we can fulfill our monetary obligations to our players

[LetsGambool]

That would make a fraud case easier, although the question of where the money comes from remains open. It can't come from the Stars settlement funds and the DOJ hasn't shown an inclination to pay out from seized commingled funds.

I've written my AP/UB money off completely, hope you have some luck finding a way to get a recovery.

[Gzesh]

Originally Posted by Skallagrim

As a matter of basic and fundamental fairness, I agree.

As a lawyer, however, I see 2 problems with getting to a fair result:

1) The DOJ never formally charged AP/UB with Fraud, and,

2) The legalities of the case dictate that the mountainous pile of money obtained by the DOJ from the Stars/FTP settlement is separate and distinct from the molehill of money they have collected in connection with AP/UB.

None the less, fair is fair. The PPA has urged, and will continue to urge, that the DOJ do everything it can to try and get AP/UB players repaid just like FTP players. But we have to recognize that the cases are not identical.

Skallagrim

Has the PPA suggested to any of its brick and mortar casino friends that they consider buying the AP/UB poker software or its player database, which would kill two birds with one stone:

1. It would generate some recovery, from which AP/UB players might get paid more than if no one steps up and buys such assets, and

2. A prospective US-licensed operator would acquire both proven* software and a marketing database for pretty cheap.

(Nothing wrong with helping sell off AP/UB assets if it will benefit players. The values would not be great, but it would possibly help a bit.)

(*I am referring to the software version without the "window" that enabled potripper to prosper.)

[baadgerman]

"Has the PPA suggested to any of its brick and mortar casino friends that they consider buying the AP/UB poker software "

Which is something else i've been wondering. Why have AP/UB not tried to sell the Cereus network? One of the primary reasons I played on FT and AP was that I liked the interfaces so much better than the PS interface (which matters quite a bit when playing for substantial periods of time). I can't believe there weren't any buyers looking for good poker interfaces. Instead they just forfeit it to the gov't, pretty much ensuring the worst/lowest possible price upon resale. And I really hate the interfaces of some of the smaller remaining sites (America's Cardroom in particular, not impressed with Pokerview either)

[baadgerman]

As to the forfeiture/remission process. Personally, I have always believed the forfeiture process to be an unconstitutional deprivation of 'property' w/o 'due process of law' (yes, i understand that post-deprivation remedies are sometimes constitutionally permissible). It simply puts too much power into the hands of law enforcement personnel and is too subject to abusive deprivations. I remember when it was initially enacted to deprive drug lords of the ability to hire good attorneys and present strong defenses. It has been extended into a wide variety of other 'criminal' activities. Moreover, the funds from such seizures often end up in the hands of law enforcement...motivating them to conduct such forfeitures. Just my 'rant and rave' i guess.

[leowolf]

Since the first post concerning the remission of FTP funds 22 days have passed by. Has anyone a clue, when the remission will start?

[baadgerman]

Originally Posted by leowolf

Since the first post concerning the remission of FTP funds 22 days have passed by. Has anyone a clue, when the remission will start?

No. The government is currently attempting to hire a 'claims administrator' to handle the FT payouts.

[Skallagrim]

Originally Posted by leowolf

Since the first post concerning the remission of FTP funds 22 days have passed by. Has anyone a clue, when the remission will start?

A clue? Yes, I think I have a clue.

Nothing will happen till at least early September as the DOJ has given payment processors till 8/31 to apply for the job of handling the remission process.

It will probably be a few more days to a few more weeks after that for a processor to be actually chosen. I would expect an announcement of some sort at that time, probably with a general time table for the actual process.

Skallagrim

[baadgerman]

Originally Posted by LetsGambool

I've written my AP/UB money off completely, hope you have some luck finding a way to get a recovery.

Intellectually, I'm assuming the worst. You know the expression 'hope springs eternal' though. Given that there appeared to be no other 'source of repayment' I thought floating a 'theory of recovery' involving known monies (the PS/FT sale) was worth a shot. As Skallgrim admits, there is a certain amount of 'fundamental fairness' involved in promoting an 'equality of outcomes' for ALL the players, not just those lucky enough to have played at the 'right' site. Obviously the value of the goodwill of FT's foreign players was of substantial benefit to PS, while AP/UB's customers were 95% American and thus of little value to PS at the moment.

[throwawayact]

Using a new account for obvious reasons...

I just realized something that may cause me an issue with getting funds as a US player.

When I first created a FTP account before I knew much about poker, I didn't sign up with rakeback. After studying and becoming a serious grinder, I ended up paying a friend to sign up an account for me.

I used that account for a year and supported my income through it (made about $12,000). I paid taxes on the income that I withdrew from the site which was approximately $11,000. $1,000 was left online when the site went down.

So after this good news about us having a good shot at getting our money out, I'm worried that my friend will get dinged for not paying taxes on the whole $12,000 that I made on the website - even though I paid taxes on what I withdrew.

Anyone have any incite for me? and yeahyeahyeah, I know... My risk for creating a separate account, but that was a Full Tilt rule that I broke, not an American Law. So since I paid taxes on what I withdrew, I'm hoping that I can prove to the IRS that it was me who was playing and me who was withdrawing, and me who was paying taxes without getting seriously dinged...

[LetsGambool]

Yikes, that's a tough one, especially because it seems like you weren't actually paying your taxes correctly anyways since taxable income isnt equal to withdrawals. See the tax sticky FAQ.

You and your friend probably need priviliged professional advice at this point.

[PokerXanadu]

Originally Posted by throwawayact

Using a new account for obvious reasons...

I just realized something that may cause me an issue with getting funds as a US player.

When I first created a FTP account before I knew much about poker, I didn't sign up with rakeback. After studying and becoming a serious grinder, I ended up paying a friend to sign up an account for me.

I used that account for a year and supported my income through it (made about $12,000). I paid taxes on the income that I withdrew from the site which was approximately $11,000. $1,000 was left online when the site went down.

So after this good news about us having a good shot at getting our money out, I'm worried that my friend will get dinged for not paying taxes on the whole $12,000 that I made on the website - even though I paid taxes on what I withdrew.

Anyone have any incite for me? and yeahyeahyeah, I know... My risk for creating a separate account, but that was a Full Tilt rule that I broke, not an American Law. So since I paid taxes on what I withdrew, I'm hoping that I can prove to the IRS that it was me who was playing and me who was withdrawing, and me who was paying taxes without getting seriously dinged...

These are my opinions about what may happen in regards to IRS involvement in FTP remission payouts. I may be completely wrong, so take it FWIW.

1. I doubt the IRS will concern itself with any remission payouts of less than six figures. And they may not get involved at all, considering that US treasury is getting their just due from the pockets of PokerStars in the first place.

2. In a case like yours, if the IRS does somehow get involved, it will probably be a simple matter of explanation to the IRS to sort it out. Just keep and provide whatever related documentation that you can.

3. It is unlikely that the IRS will concern itself with whether taxes were reported and paid on withdrawals or winnings. Although the general agreement among those familiar with gambling tax rules is that poker winnings and poker losses have to be reported separately, as explained in the tax sticky, there are no actual tax ruling precedents for online poker play. For income amounts under six-figures, I doubt the IRS will expend much, if any, resources to clarify this grey area as the additional net collectible taxes after IRS auditing expenditures would be quite small in the scheme of things.

Bottom line, you are probably worrying about something that will never be an issue. Besides which, it's not like there is anything you can do now to ameliorate the situation. Just keep your documentation, and let sleeping dogs lie.

The only people who need to take action now are those that didn't pay taxes in the first place on their winnings.

[sba9630]

Originally Posted by 1938ford

Just some additional FYI for those interested:

In the case below a forfeiture order was made in August 13 of 2010. The actual notification for remissions did not go out to victims until April 28, 2011. According to the claims administrator no remissions have been made. They hope to have "hard date" for actual checks going out before the end of September. This case involves less money and fewer victims than the FTP case.

http://www.xybernautremission.com/EN/

In the QWest Communications case there was a forfeiture order of 44 million in 2007 as a result of a criminal conviction. Remission in that case took until March of 2012.

These are, unfortunately, typical time periods associated with remission. I'm not saying the FTP case will follow this pattern. I do not KNOW. But, at the very least history suggests it will take more than a few months to settle the matter.

.

[Skallagrim]

It is pretty hard to compare the FTP case to those other cases.

On the plus side: both the money and all the financial records needed are already in DOJ hands. In most other cases it took a long time from the forfeiture order to the point of actually having those two things.

On the minus side: the processor will be dealing with hundreds of thousands of accounts and remission checks. Some will be easy to process, but many will have glitches ("I forgot my password, etc...).

Neither plus nor minus: government speed is not like normal speed and far less than internet speed.

When explaining the right to speedy trial to folks I have gotten to the point of simply saying "what is speedy to the government and the courts has no relation to what is speedy to the average person, but they can't delay your trial forever."

I think this case will be somewhat in between: not near as fast as we would like or expect from the private sector, but faster that most of the pessimists are suggesting.

Skallagrim

[sba9630]

I copied that here hoping you would give your opinion, thanks for the info.