Kentucky Slaps $870m Fine on PokerStars for UIGEA Violation

Kentucky Slaps $870m Fine on PokerStars for UIGEA ViolationHaving paid the US government $731 million for violating the UIGEA between 2006 and 2011, PokerStars’ biggest headache of late revolved around whether it would be able to shake off its “bad actor” label and reestablish itself back in the US. This year, the Amaya owned business then received a massive boost after being granted its much anticipated iGaming license from New Jersey, but with 2015 almost in the bag the year has now ended on somewhat sour note for PokerStars after been ordered by a Kentucky judge to pay the state $870 million.
In the five year-period between 2006 and Black Friday, around 34,000 Kentucky residents are believed to have lost some $290 million gambling on PokerStars’ unregulated site, although according to Amaya that figure is a simplified “gross distortion” of facts, as most of the money was lost to other players and not PokerStars. Furthermore, Amaya’s attorney Sheryl Snyder explained that PokerStars’ gross revenue from Kentucky during that period was nearer to $18 million, but despite the discrepancy, PokerStars is now facing a massive fine of up to $870 million. Pending payment of the fine, PokerStars is also facing additional interest penalties of 12 percent, and as Franklin Circuit Judge Thomas Wingate explained:
“Without a doubt, the Defendants made a business calculation that took into account the violation of Kentucky’s laws. However, the law is more than some ordinary itemized expense on a balance sheet, and its value is not as easily accounted for as the Defendants may have thought as they executed their illicit business plan.”
In the meantime, PokerStars has stated that any recovery of funds should be made against the site’s former owners, while the Poker Players Alliance has also rallied behind PokerStars and described the lawsuit as a “cynical big government money grab of private consumer dollars to pay for political excesses.” Adding further credence to the PPA statement is the fact that presently any money recovered is expected to end up in state coffers, and not the pocket of the gamblers involved.


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