PokerStars Founder Isai Scheinberg Sentenced to Time Served
Isai Scheinberg, founder of PokerStars, has been sentenced to time served and a $30,000 fine, bringing an end to the prosecution from 2011 surrounding the shutdown of the largest online poker sites.
Scheinberg, a 73-yard-old Israeli, pleaded guilty this week to a federal online gambling charge in New York, which could have resulted in him going to prison for 12-18 months, according to Inner City Press. He originally faced up to five years in prison for directing an illegal gambling business in the United States, according to the U.S. Attorney’s office.
Attorneys for Scheinberg argued he deserved a lesser sentence, saying online poker didn’t violate U.S. law. Scheinberg’s lawyers said he deserved a lesser sentence for surrending to U.S. authorities and because PokerStars took on the $304 million of Full Tilt Poker’s liability, according to the report in Inner City Press.
Although some states have legalized online poker since the shutdown in 2011, the so-called Black Friday, the prosecution said the charges were based on the laws and norms in place at the time of the offense.
The prosecution did take into account the Full Tilt repayment to customers in recommending a reduced sentence.
Scheinberg’s background in mathematics and programming helped him create PokerStars’ software. Founded in 2011, PokerStars would become the largest online poker site in the world.
And while some companies fled the American market after the passing of the Unlawful Internet Gaming Enforcement Act in 2006, PokerStars and Full Tilt Poker continued to take action in the U.S. This led to the federal government seizing the domain names and funds of the biggest online poker providers on April 15, 2011. Scheinberg was one of 11 people indicted in the process.
The outlook and perception of online gaming has changed since Black Friday. Online gaming has become a state-by-state proposition, resulting in the return of PokerStars in the US. PokerStars is currently operating in Pennsylvania and in New Jersey. The company also has a partnership in place to launch a Michigan platform when the state launches its online gaming market.
Scheinberg no longer owns PokerStars. He and son Mark Scheinberg sold their share in the company to Amaya Gaming in 2014 for almost $5 billion. PokerStars is now an entity within The Stars Group, which itself is now part of Flutter Entertainment.
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