Douglas Rennick said in federal court yesterday, “I had business that transferred money from offshore gaming sites to American players within the Southern District of New York,” as he pleaded guilty towards a single count of dealing offshore bets.
Rennick is a Canadian who is alleged to be behind quite a few online poker payment processing companies. He will be sentenced on September 15. Rennick’s lawyer said that his client’s plea will mean the forfeiture of $17.1 million as well as 6 to 12 months incarceration.
This is far less from what he could have faced if he had not pled guilty and then found to be guilty of all charges he is facing in federal court.
Aside from being charged of processing offshore bets, Rennick was also indicted last August for bank fraud conspiracy, gambling conspiracy, and money laundering conspiracy. Should he be convicted of all the charges, he would be facing up to 55 years of imprisonment.
Rennick has been alleged of having been operating several shell companies which he used for transferring money to and from online gambling companies which included Account Services Corporation, Alenis Limited, Check Payment Financial Co, KJB Financial Corporation, and My ATM Online. These companies were some of the companies that online poker players could possibly recognize from their checks.
A lot of poker players as well as the people that were involved in the industry expressed their strong disapproval over the indictment during that time because the federal government has been playing hard ball. The gambling charge he was being accused of was in fact the least heavy of the three. The most he would have faced could have come from bank fraud and money laundering charges, both of which he did not admit to in his plea deal.
The indictment read, “Rennick did not disclose to Washington Mutual Bank that KJB Financial Corporation would process payments from internet gambling companies. Instead, Rennick falsely and misleadingly represented that his company would issue checks ‘for the following reasons’…”
Among the reasons that Rennick had allegedly gave were affiliate checks, rebates, refunds, minor payroll, and sponsorship checks.
The Southern District of New York as a record of chasing online poker-related cases. They were able to seize over $34 million of poker funds in June of 2009 which were about to be sent out players on several poker sites. This included Absolute Poker, Full Tilt, Pokerstars, and UB.
A man who was alleged to be Daniel Tzvetkoff was arrested in Las Vegas last month for laundering money as a poker payment processor as well. New York’s Southern District will be heading up that investigation as well.