Will some of your favorite poker stars end up in jail for participating in an alleged online ponzie scheme? These stars, who are familiar names if you watch any televised poker, have a large personal interest in the announcement from the U.S. Department of Justice on March 1st that they have reached a settlement worth $731 million dollars with online poker companies PokerStars and Full Tilt Poker. This settlement resolved bank fraud and money laundering allegations against these online poker giants.

More serious charges of operating a ponzi scheme (The scheme is named after Charles Ponzi, who became notorious for using the technique in 1920 .The scam works by luring investors in with the promise of huge quick profits, and paying the initial investors with money from the following "investors". Eventually, when the scheme runs out of new investors to scam, the whole thing collapses)against Full Tilt were also resolved. The allegations were filed last year that Full Tilt had used more than $400 million that had come from players deposits to reward owners and board members since 2025. Our old friend Full Tilt Poker will pretty much cease to exist as part of this settlement. They will be giving the government virtually all of their assets, which will then be acquired by the still surviving PokerStars. According to the complaint, Full Tilt owes foreign players about $180 million , a debt that Poker Stars will now pay. U.S. players who may have been victims will have to contact the government (good luck with that)to get their share of the $547 million given up by PokerStars to the Feds. Just in case you want to take a chance on getting some of this money, there is as of yet no mention of the application process.

This case began last year, when the Feds accused these companies of trying to get around the ridiculous U.S. ban on online gaming by using phony retail companies to trick U.S. banks and credit card issuers into processing payments for players in the U.S. This allowed gambling deposits to show up as purchases of sporting goods or jewelery, for example. A third company, Absolute Poker, will be required to give up all of it’s remaining assets.

So far, eleven people, some of whom have already been arrested , face criminal charges, including the former boss of Full Tilt, Mark Scheinberg, who was one of the people arrested. Poker TV superstars Howard Lederer and Chris(Jesus) Ferguson, who were both Full Tilt board members, have been able to avoid spending any time in "the big house". They will still have to face civil charges however. We will keep you posted as the situation continues to evolve.