It took nearly nine years for the founder of PokerStars to travel to the United States to face his indictment issued by the Southern District of New York. It took only two months from the time Isai Scheinberg submitted to be taken into custody and the date he pled guilty.
Many figured Scheinberg would never return to the US, especially considering it had been nearly a decade since the US Attorney’s Office handed down the online poker indictments on April 15, 2011 – poker’s Black Friday. He had lived in Toronto since he moved there in the mid-1980s, and he sold his stake in Amaya Gaming in 2014, thereby severing all ties with PokerStars, the company he and his son, Mark, founded in in 2001. There seemed no reason to set foot in America again.
For whatever reason, though, Scheinberg traveled to Switzerland in 2019, which has an extradition treaty with the United States.
A January Surrender
Previous information made it seem that Scheinberg voluntarily flew to the US to surrender. That was not the case.
He had been in Switzerland in 2019. And he was arrested there on June 7, 2019.
It took some time for Scheinberg to be extradited to the US, as Scheinberg did appeal that decision to allow the Swiss Federal Office of Justice to do so. However, he eventually withdrew his appeal and agreed to be extradited and face charges in the US.
Scheinberg landed in New York City on January 17, 2020. Upon landing, federal agents took him into custody at the airport.
https://twitter.com/OPRupdate/status/1242886644698677259?s=20
The 73-year-old appeared in a Manhattan federal court on that same day for his arraignment, pled not guilty, surrendered his passports, and posted $1 million bail to leave jail on January 21.
The charges on the books when Scheinberg pled not guilty were:
--Conspiracy to violate Unlawful Internet Gambling Enforcement Act (UIGEA), with maximum penalty of five years in prison, fine of $250K or twice gross gain or loss, and three years of supervised release--Violation of Unlawful Internet Gambling Enforcement Act (UIGEA), with max penalty of five years in prison, fine of $250K or twice gross gain or loss, and three years of supervised release--Operation of illegal gambling business, with max penalty of five years in prison, fine of $250K or twice gross gain or loss, three years of supervised release, and forfeiture of proceeds of offense--Conspiracy to commit bank fraud and wire fraud, with max penalty of 30 years in prison, fine of $1M or twice gross gain or loss, five years of supervised release, and forfeiture of proceeds of offense--Money laundering conspiracy, with maximum penalty of 20 years in prison, fine of $500K or twice the amount laundered, three years of supervised release, and forfeiture of proceeds of offense
A Guilty Plea
On March 25, US Attorney Geoffrey Berman issued a press release from the Southern District of New York. He announced that Scheinberg pled guilty to “running a multimillion-dollar unlawful internet gambling business.” Berman continued:
“Ten years ago, this Office charged 11 defendants who operated, or provided fraudulent payment processing services to, three of the largest online poker companies then operating in the United States – PokerStars, Full Tilt Poker, and Absolute Poker – with operating illegal gambling businesses and other crimes. As Isai Scheinberg’s guilty plea today shows, the passage of time will not undermine this Office’s commitment to holding accountable individuals who violate US law.”
https://twitter.com/OPRupdate/status/1242876532932083717?s=20
Per the document, the indictments came from the 2006 Unlawful Internet Gambling Enforcement Act (UIGEA) that made it a federal crime to “knowingly accept” forms of payment in connection with a person participating in “unlawful internet gambling.”
Scheinberg, in his guilty plea, admitted that he knew the business of offering internet poker to New Yorkers violated state and federal law. He did it anyway. He pled guilty to one count of operating an illegal gambling business in violation of 18 U.S.C. §1955, the prohibition of illegal gambling businesses, listed under the racketeering section of the US Code.
This was the third charge listed above, which carries a maximum sentence of five years in prison. This is a far cry from the original combined maximum penalty of 65 years he faced from the initial charges.
A sentencing date is not yet set but will be determined by US District Judge Lewis A. Kaplan.
When this occurs, it will close the last of the cases against the 11 defendants indicted in April 2011. The original indictment resulted in guilty pleas from all of them:
