By Albert Samaha
By Steve Weinstein
By Devon Maloney
By Tessa Stuart
By Alison Flowers
By Albert Samaha
By Jesse Jarnow
By Eric Tsetsi
In 2007 and 2008, the Boston Globe reported, the congressman received $48,300 in campaign contributions from poker interests—7 percent of his total individual contributions.
D'Amato called the Bush bill "ridiculous legislation": "They've curtailed the rights of millions of Americans," he declared. "The little guy, the person who maybe can't come to Las Vegas."
The PPA claims a million members, but much of its financing comes from the Interactive Gaming Council (IGC), a Canadian trade group made up of international Internet gambling companies and gaming software developers. (The IGC backs only casino games and poker, not sports betting.)
The group has spent some $4.5 million on federal lobbyists since 2006, records show. More than $1 million of that has gone to D'Amato's Park Strategies lobbying firm. The PPA has also doled out $132,000 in campaign contributions since 2007, which doesn't include spending on the state level.
Opponents of Internet gambling say that the speed of the game, the availability, and the amount that people can lose add up to a toxic combination. A study released a few years ago concluded that more than a million young people are using Internet gambling sites on a monthly basis.
"This is not a debate about social gambling, like a kitchen-table poker game," says Les Bernal, executive director of the group Stop Predatory Gambling. "This is about a business model that relies on addicted and heavily indebted people.
"I think there's a lack of understanding about how the predatory business model works," he adds. "The more you wager, the faster you do it, the quicker it gets out of control. You can play five or six hands at once. Should we really bring Las Vegas into our homes 24 hours a day?"
While Barney Frank, Al D'Amato, and others pushed to make Internet gambling legal, investigators pushed on with their probe of Giordano.
In May 2006, Giordano moved his offices from St. Maarten to Costa Rica. There, he located his operation in a set of warehouse buildings adjacent to telemarketing outlets owned by multinational corporations and travel agents. He had about 35 employees, most of them Costa Rican.
More than 200 Internet gambling companies are located in the Central American nation, whose government tolerates them as long as their bettors are located in other countries.
Giordano hired a Costa Rican law professor named Juan Carlos Montero to set up the company and payroll structure: "I am not going into a foreign country without being totally on the up-and-up," he says.
But six months after Giordano moved the business to Costa Rica, the jig was up.
Police officers in New York, New Jersey, Florida, and Las Vegas moved in, arresting Giordano and his wife at their Florida home, as well as 25 other people in other locations. Three companies were also charged.
Among the host of allegations were enterprise corruption—a law often used to prosecute reputed mobsters—money laundering, promotion of illegal gambling, possession of gambling records, and conspiracy.
Prosecutors also filed a $500 million civil forfeiture case.
Authorities claimed that Giordano's company booked more than $3.3 billion in sports betting wagers over 28 months. (Giordano says those numbers are preposterous.)
A series of search warrants were served in New York, Las Vegas, and Florida. The federal raid in Florida seized Giordano's house, $288,000 in cash, and the $50,000 in gambling chips from the Bellagio that he had won in the poker tournament. Authorities froze the Giordanos' Swiss bank accounts.
Brown described the case as the first to occur after Bush signed the new gambling law, and the first to charge a Web designer and an offshore Internet company with involvement in a criminal enterprise. He accused the company of laundering "untold millions" through casinos, shell corporations, and bank accounts in Central America, Switzerland, and Hong Kong: "Internet gambling is a multibillion-dollar worldwide industry that for too long has operated with impunity," he declared.
Kelly, meanwhile, described the venture as "the largest illegal gambling operation we have ever encountered." He said that law enforcement had "smashed" it.
Blind quotes in the newspapers claimed the operation made payments to an acting organized crime boss, but that was never alleged in the indictment or proved in court.
The arraignment judge set bail at $5 million. Though he would successfully appeal that number, Giordano began 10 months of pre-trial incarceration at the Vernon C. Bain Correctional Center, a rusty 800-bed barge-turned-jail on the East River.
"I had never been incarcerated, and it was like hell," he says. "The guards don't treat you well, the bedding is terrible, the food is horrible. It was always freezing. The facility isn't designed for a long stay."
To pass the time, Giordano read books and newspapers. On occasion, he played poker with makeshift chips.
What followed were three years of legal wrangling that, at times, took comical turns.
At a bail reduction hearing in July 2007, Martin Schulman, a 15-year veteran of the bench, got into a remarkable exchange with prosecutors over the hypocrisies inherent in American gambling law. He repeatedly questioned prosecutor Gerard Brave, asking, for example, whether it would be legal for a Las Vegas casino to come to Queens and collect a gambling debt.