By Jared Chausow
By Katie Toth
By Elizabeth Flock
By Albert Samaha
By Anna Merlan
By Jon Campbell
By Jon Campbell
By Albert Samaha
Killing livelihoods and a $2.5 billion industry, the feds attack Internet gambling
"I figured if gambling online is illegal, I might as well go to legalized gambling in the form of the stock market," Fritz says, laughing. A friend had gone to a Wall Street firm and "just blew the doors off, and he said what he learned in poker really helped him. They were like, 'Well, we need to hire more poker players.'"
For Michael LaTour, the game was a way out of unemployment. The Syracuse man landed a job out of college selling mortgages and personal loans for American General Financial. But a year later, spectacularly inept bets by American's parent company, AIG, put him back on his ass.
"There weren't many jobs out there, and I'd been on unemployment for a while," LaTour says. "I saw some people being successful at poker, and I decided if I was ever going to seriously take a shot at it, now would be the time to do so."
LaTour played for two years, earning $50,000 in 2010. Averaging $10,000 a month for 2011, he was doing much better last year, until the feds came calling. Suddenly, the $35,000 in his PokerStars account was seized.
"The days after, it was really a panic," LaTour says. "Nobody knew what was going on. It's been draining emotionally."
If he and his girlfriend hadn't bought a house, LaTour might have gone to Canada. Instead, he has taken the Syracuse police-officer exam, but the academy doesn't offer classes until April. Two years after pulling himself off unemployment by his wits, he's back to searching for a job.
"This isn't something I wanted to do my entire life, but the money was out there, and it made more sense than any entry-level job just because of the potential to win such huge amounts of money," LaTour says.
Players weren't the only ones thrown out of work. The feds blew up an entire industry. In 2003, Michael Minkoff started a business that handled the shipping of poker books and videos sold on websites. His Las Vegas company also did freelance video production. It was a modest affair, employing three people and a passel of part-time help.
Then came the stealth attack by Frist and Kyl in 2006. Hurling little guys like Minkoff to the side of the road, sites began closing and paring costs. Black Friday nearly finished him. At his peak, he moved more than a thousand books a month. Now, he sells less than 50, hardly enough to employ himself part-time.
The feds launched an even bigger hit on the television industry. The list of canceled shows since April is long. Poker After Dark, the late-night show on NBC, was canceled abruptly after four years when the feds called its sponsor, Full Tilt, a Ponzi scheme. High Stakes Poker ended a six-year run on the Game Show Network in December. The National Heads-Up Poker Championship, also on NBC, collapsed in October after seven years. In April, Fox pulled PokerStars Big Game and PokerStars Million Dollar Challenge prior to their second seasons.
According to Kantar Media, Full Tilt and PokerStars spent $26 million in TV advertising last year; PokerStars spent another $8.3 million on Web and magazine ads. In one fell swoop, the feds made it disappear.
Although the feds wiped out the major American sites, a few remain, most notably Bovada and Merge Gaming Network.
The volume is much lower, and it's difficult to get paid. All have severe restrictions on how much and how often you can withdraw from your account. Merge only allows players to withdraw up to $2,500 once every six to eight weeks. And many are finding it difficult to add money to their accounts, since credit-card companies will often reject the transaction.
After Black Friday, Wright started playing on Merge just to salve nerves made raw by an empty wallet and a squealing baby. He and his wife went to Florida for a live World Poker Tour event, but he didn't play well. When they returned to North Carolina, they didn't even have enough money to get their dogs out of the kennel.
With their marriage stretched to its breaking point, Wright went to Costa Rica just before Thanksgiving. A friend agreed to front him a roll, pay his airfare, and cover his rent for a few months.
Costa Rica has become a magnet for Americans. Wright lives in an apartment complex with other online players. The country's tourist-friendly economy makes it a logical landing spot for those like Wright, who has a DUI and, subsequently, isn't allowed into Canada. Since Black Friday, companies such as Poker Refugees have sprung up to help players gets visas, bank accounts, and apartments in Costa Rica.
But there remains a larger question: Why are the feds chasing honest, taxpaying citizens out of the country? Especially for something as benign as playing cards, an act committed by nearly every American?
Congressman Barney Frank denounced the crackdown as an "incredible waste of resources" and wondered why the feds felt compelled to protect "the public from the scourge of inside straights."
After all, for most of the country's estimated 2 million online players, poker is little more than recreation. And those who made their living from it seemed to personify the American spirit, providing for their families by creating livelihoods from their wits.