When You Gamble... And Lose

It's a dark era for online poker.  Its legality has been under fire for years.  And it turns out that the card-sharks-turned-entrepreneurs willing to circumvent the law and financial interdiction may not have been the most trustworthy of characters after all.  The Justice Department came out firing last week, branding Full Tilt Poker - by my reckoning, the best-known, most mainstream online poker site - a fun but still fraudulent Ponzi scheme.

Actually, Iridium, you didn't win anything...

Full Tilt Poker seemed to have lost the faith of their clientele back in April when the feds' measures started blocking withdrawals.  But these latest allegations put some former FTP players over the edge.  Rafe Furst, one of the lesser-known FTP execs (after Howard Lederer and Chris "Jesus" Ferguson), took to the blogosphere not so much to answer the accusations as to claim innocence and call for support.  Reception was overwhelmingly icy, though.  Probably the most popular comments were either of two varieties - "F*** you!" or "Where's my money?  Now I can't pay my bills..."

What's the world coming to when you can't trust Jesus with your money?

Now, I enjoy the occasional friendly game of poker, and even spent a few years playing on less-resourceful-thus-now-defunct PartyPoker.  I got my money out (not more than $50 by the last withdrawal), having already banked some small winnings.  Good times.  If Uncle Sam hadn't come down against online gaming, I could possibly still have been active.  I believe I even signed a petition for the Poker Players Alliance at some point; I seem to remember it was worth $10 to my PP account...

On that note, that bonus may be a bit of a clue that these online poker companies were fabricating the money in their clients' balances.  As a small-fry gambler (and online personal finance expert), it's difficult to sympathize with people who seemed to think of their FTP balance as a stream of income, secure store of wealth and even investment vehicle of sorts.  Were they unaware of its tenuous legal status?  Were they not tipped off by the hoops they had to jump through to deposit and withdraw money through intricate international payment systems, while such was even possible?  Did they forget that they were gambling?

That said, I also have some words for supporters of FTP and its celebrity execs.  "Innocent until proven guilty" only counts in actual courts, not the court of public opinion, and especially not the new Wild West of the Internet.  However misguided former FTP clients may have been, they have lost money while now seeing the staggering amounts FTP execs were paid even as their business model was dying (or being killed off).  Whether or not FTP is as guilty as the DoJ claims, they undeniably should feel ashamed at profiting from their clients' misconceptions at best, delusions at worst.

In the end, this whole scandal is probably just ammunition for advocates that online poker should be legalized, regulated and taxed.  I've never found those kinds of arguments particularly convincing in other areas, e.g. drugs.  But with an issue that does resonate a little more strongly with my own experience, I'm starting to rethink that blanket stance.