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PokerStars Founder Pleads Guilty to Illegal Online Gambling

Bloomberg logoBloomberg 3/26/2020 Chris Dolmetsch

(Bloomberg) -- The founder of PokerStars admitted Wednesday to running an illegal online gambling business, nine years after he and other online poker executives were indicted by prosecutors in New York.

Isai Scheinberg and 10 other principals at three online gambling companies were charged by federal prosecutors in New York in March 2011 with bank fraud, money laundering and illegal gambling. The other executives have all pleaded guilty and been sentenced. PokerStars agreed in 2012 to pay $731 million to settle the charges with the Justice Department, without admitting wrongdoing.

Scheinberg, 73, a dual Canadian and Israeli national, was arrested in Switzerland in June 2019 and was brought to the U.S. in January after dropping an extradition challenge. He faces as long as five years in prison at sentencing, which has yet to be set. Under his plea agreement, prosecutors agreed to seek a sentence of 12 to 18 months.

He’s pleased to put the matter behind him, a spokesman for Scheinberg said in a statement.

“Notably, all PokerStars players were paid back immediately and Mr. Scheinberg played an important role in ensuring that all of the players from other sites were repaid as well,” according to the statement.

Read More: Poker Websites Agree to Settle U.S. Money-Laundering Probe

(Updates with statement from spokesman for founder)

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