On Tuesday, a second domino fell in the ongoing “Black Friday” prosecutions by the U. S. Department of Justice, this time falling on one of the prominent payment processors for the online poker industry.
In front of Judge Gabriel Gorenstein in a Manhattan court yesterday, 53-year-old Ira Rubin appeared in a full prison issue tan jumpsuit, as he has been in custody since his arrest during the summer of 2011. Facing nine counts in the “Black Friday” indictments – three violations of the Unlawful Internet Gaming Enforcement Act (UIGEA) of 2006, conspiracy to violate the UIGEA, conspiracy to commit bank and wire fraud, conspiracy to commit money laundering and three counts of operating an illegal gambling business – Rubin was facing the possibility of, if convicted, over 80 years in jail. Thus, it was little surprise that Rubin chose to plead out for a lesser sentence.
During his plea, Rubin had to admit what he did so that it was properly recorded for further review of the case or potential appeal. While standing in front of Judge Gorenstein, Rubin admitted that he worked with the top two online poker operations at the time, PokerStars and Full Tilt Poker, as a payment processor. From 2006 through March 2011, Rubin admitted that he conspired with the online poker outlets to “disguise payments as nonexistent merchants” to circumvent online gambling laws in the United States. In the United States, credit card companies will not process transactions if they appear to be gambling related.
Details have also emerged as to why Rubin has been in an American jail since his arrest last year. On the very day of “Black Friday,” Rubin chartered a plane from Costa Rica to Guatemala and further intended to head for Thailand. He intended to get a fake passport in Guatemala that would have allowed him to travel relatively at ease, the Assistant U. S. Attorney Arlo Devlin-Brown stated, which brought about his arrest upon landing in Guatemala. Brought in front of the courts in the United States in June, bail was denied for Rubin for his potential as a flight risk.
Following the hearing, Judge Gorenstein ordered Rubin back into custody until sentencing on May 17. It is expected that, as a part of the plea deal, Rubin will receive between 18 and 24 months in prison; with prior time served, however, he will most likely be released after the May 17 sentencing.
Canadians will remember Rubin from a particular case that involved his role in telemarketing. A company Rubin founded, Global Marketing Group, was accused by the Federal Trade Commission of telemarketing fraud that involved at least nine Canadian telemarketing firms that sold fake credit cards to customers. After the FTC issued a restraining order against Rubin from engaging in the activity, Rubin violated the order and was ordered to appear in court in 2008 to demonstrate why he shouldn’t be held in contempt of court for that violation. Instead of appearing in court, Rubin fled the United States and headed to Costa Rica.
The plea of Rubin marks the second person to fall from the indictments of “Black Friday.” One month ago, Absolute Poker co-founder Brent Beckley pled guilty to one charge of conspiracy to commit wire and bank fraud. To date, none of the other indicted men – including the alleged owners of PokerStars (Canadian Isai Scheinberg), Full Tilt Poker (Ray Bitar) or the UB/Absolute tandem (Scott Tom) – have been apprehended to face the charges that have resulted from the “Black Friday” indictments of April 2011.
While both Full Tilt Poker and the CEREUS Network (Absolute Poker/UB.com) have gone dark since “Black Friday,” PokerStars maintains its status as the #1 online poker site in the industry.