PokerStars and Online Poker History

PokerStars celebrated its 25th anniversary in 2026, marking a quarter-century since the launch of one of the most influential platforms in online poker history.

The platform was founded by Isai Scheinberg and his son Mark Scheinberg. Its public play-money beta launched on 11 September 2001, followed by its first real-money poker games on 12 December 2001.

Over the following 25 years, PokerStars played a significant role in the expansion of online poker, introducing major tournament series such as the World Championship of Online Poker (WCOOP) and supporting live events including the European Poker Tour (EPT).

The company’s history also includes the 2011 US Black Friday enforcement actions, the acquisition of Full Tilt Poker’s assets in 2012, its sale to Amaya Gaming in 2014 and its subsequent incorporation into Flutter Entertainment in 2020.

In 2026, PokerStars expanded its North American operations through a closer integration with FanDuel, another brand owned by Flutter Entertainment.

Today, PokerStars operates within a multinational gambling group, with services provided through different regulated entities according to the applicable jurisdiction.

Online Poker Up to PokerStars

Up until 2001, online poker was in its infancy. The very idea of «electronic poker» originated long before the appearance of the mass internet.

The first poker programs were developed in the 1970s, alongside personal computers. In the early 1980s, the famous poker player and theorist Mike Caro-«Mad Poker Genius»-wrote a program for head-up games in Limited Hold’em on an Apple II computer that showed good results even against professional players. About this time, Las Vegas Casino began installing the first video poker machines and early video poker consoles also allowed several players to play against each other and against the computer draw and stud poker.

International poker

By the end of 1988, the first IRC chat networks had been established. In 1994 scientists of Carnegie Mellon University in Pittsburgh created a script that allows IRC users to play poker against each other. After connection to the poker server, players selected the channel corresponding to any type of poker game and very game itself was performed by input of commands «check», «bet», «call», «raise» and size of bets. The game used Play Money chips, but this didn’t prevent some poker players from playing against each other using real money.

In 1995, the first online marketplaces like Amazon and eBay appeared, which gave birth to rapid development. Soon, the first gambling websites began appearing.

The first real money hand was played on January 1, 1998, at the $3/$6 Limit Hold’em table with a minimum $30 buy-in. The game in this room was played directly in the browser, and the graphics were pretty primitive: a static picture of the poker table with avatars of players that can’t be changed and some modest animation of actions. Also, the modem connection malfunctioned, so disconnects happened a lot, and there was discovered a certain vulnerability in the random number generator that later was fixed. Yet, with the help of an ad placed by Mike Caro – who became the first ambassador in online poker history – room traffic began to grow at an incredible rate.

In 1999, Paradise Poker took over the lead with improved software, graphics and more games and PartyPoker opened in the summer of 2001. PartyPoker is known for its large-scale promotional campaigns and tournaments which have rightly made them the leader online poker start of the two-thousandth. It was here that the $1,000,000 tournament first appeared.

Emergence of PokerStars

Later in the fall of 2001, PokerStars launched a Play Money Beta, and by December, real money games went live. PokerStars has taken a big step up from its competition with their new provided users even better graphics and animation. The client has basic game statistics as well as to take notes on opponents and upload their own avatars. Besides Hold’em there were also Omaha and Stud poker, mostly in the limited format but also some tables of Pot Limit. The very first account on the site was created by the Swedish player Oscar «pokermaniac» Hornell. PokerStars Room offered a great selection of tournaments – one of the most important online poker innovations that played a huge role in the poker boom. Along with PokerStars, the following had become leading companies in the industry within the last few years: Pacific Poker – later to be rebranded as 888poker, Absolute Poker, Bodog, Full Tilt Poker.

In 2001, though, online poker was still a pretty new phenomenon and hadn’t been widely adopted by the poker community. Many offline players were suspicious of this online version of the game and didn’t consider it “real poker.” Very soon this attitude changed.

Chris Moneymaker wins WSOP 2003

2003 was a turning point in the history of PokerStars and online poker. If you poll all the current poker players who have reached the age of majority by now, most would say they first learned about online poker in 2003. There are many reasons for that, but they all concern the persona of Chris Moneymaker, a 27-year-old accountant from Tennessee who won the 2003
WSOP
Main Event by racing there via a PokerStars satellite. The best poker hero was hard to come by. Online satellites to the WSOP Main Event that year were introduced for the first time. Organizers of the World Series signed agreements with several sites, including PokerStars. Manimaker, playing in the room under the nickname «Money800», jumped into a one-table Sit-n-Go with a buy-in of $86 at the last minute, not knowing that it was a satellite to the WSOP mainline event. «If I had known about this, I would never have sat down to play that tournament», he later admitted.

Having won this Sit-n-Go, Moneymaker qualified for the $ 650 Final Satellite, which gave away three tickets to the WSOP main event. This $8,205 fourth-place consolation would have been sufficient to pay off his credit card debt, but a friend convinced Chris to seek a Las Vegas journey with the promise of $5,000 in exchange for half his main event action. Moneymaker won the ticket and his friend didn’t have that amount. For traveling expenses, though, the organizers provided just $1,000, and so Chris sold the shares to another friend. The rest, of course, is history: during the Main Event, Chris Moneymaker outlasted 839 players and captured the championship bracelet, transforming $86 into $2,500,000 in prizes. A video featuring Moneymaker’s win ran on ESPN for several months, which encouraged more players to open accounts on PokerStars and other rooms. And thus the poker boom started. Online satellites changed the tournament poker landscape once and for all. Due to them large offline tournaments started gathering more and more participants, live poker was attracting more amateurs and the line separating the «old-school» players from the «internets» began to dissolve. Next year Greg Raymer won the WSOP Main Event, which also was selected through the online PokerStars satellite, but his prize equaled a double of $5,000,000. By 2006, participation in the World Series of Poker (WSOP) Main Event had increased dramatically, reaching 8,773 entrants compared with 839 in 2003.

Online qualification tournaments organised by PokerStars and other poker platforms contributed significantly to this expansion.

In 2006, American poker player Jamie Gold won the WSOP Main Event and received the first-place prize of USD 12 million, which remains the largest individual first-place payout in WSOP Main Event history as of October 2026.

The rapid growth of the WSOP during this period became known as part of the global poker boom, which was strongly influenced by Chris Moneymaker’s victory in 2003.

WCOOP becomes the biggest tournament series in online poker

But the participation of Moneymaker in the victory was not the first big triumph of PokerStars. A year before his win when the WPT offline tournament series had only just started, and the European Poker Tour had not yet begun, the Starzes organized the first
«World Championship of Online Poker» (WCOOP)
– an online equivalent of the WSOP.

The series consisted of nine events with buy-ins starting from $109, then-high. The biggest number of participants – 565 – signed up for Limit Hold’em event, the smallest was Limit Omaha High Low – 135 entries. At the ME with $1,050 buy-in and 238 players, another Swedish MultiMarine earned himself $65,450.

The WCOOP debut in 2002 was just great: PokerStars proved that this online series can become competitive against live poker festivals, also gaining popularity. After Moneymaker’s victory, the «World Championship of Online Poker» began to gain popularity even faster than the prize funds of the World Series. By that time, in 2010, the WCOOP Main Event prize pool increased to 12,200,000 dollars, and Tyson’s «POTTERPOKER» Marx’s win for the 2010 WCOOP Main Event was 2,278,098 dollars, which is still a record today. Obviously, all these figures reflect the growing popularity of online poker worldwide and the pace of money flow into the poker economy.

In the early years, WCOOP had been marketed as an elite poker series with players in low limit action needing to wait until 2017 before being able to play WCOOP tournaments for less than $100. This trend of expanding the series into more cheaper tournaments received massive criticism from a part of the poker community that felt it devalued the WCOOP brand. But this step allowed for several times increasing the number of participants in the series. In 2021, the total number of WCOOP tournaments reached 306, and the total prize pool rose to $122,340,165.

Up until Black Friday 2011, the majority of WCOOP tournament winners were Americans. Within days after PokerStars pulled out of the United States market, it fell down to number four. For a long period of time, PokerStars had the reputation of being a poker room for American players, who were among the largest share of the player base. After the exodus of many Americans, PokerStars started to target players from Europe and Latin America.

PokerStars come to offline poker and launch the revolutionary EPT series.

In 2004, PokerStars launched their live tournament series, called the European Poker Tour, or EPT for short. It is generally assumed to be an experiment in which nobody had been certain whether it would prove successful, but it was not. European poker players, inspired by the overseas triumph of Chris Moneymaker, were eager to see a major series on their continent – all they lacked was an ambitious organizer with the right financial resources.

Unlike the WSOP, which is held once a year in Las Vegas, the EPT début season ran from September 2004 to March 2005 and had seven stops across Europe at one-month intervals: Barcelona, London, Dublin, Copenhagen, Deauville, Vienna and Monte Carlo. Thanks to an assortment of online satellites, everyone had a chance to compete, and in the following years the chance was taken by young winners of major events Jeff Williams, Mike McDonald, Gavin Griffin and Jason Mercier. In that time, the buy-ins in the vast majority of poker tournaments in Europe didn’t exceed €1,000 and such tournaments collected around 200 entries. Major events were always filled with US stars, of course – especially if there was a lucrative cash game on offer – but for the most part, the tournaments consisted of locals. PokerStars was excellent at promoting the EPT as something entirely new – poker as a game where clever young men and women get together and fight for hundreds of thousands in prize money in the most beautiful tourist destinations. But it so happened that the first season of the series coincided with the start of the era of cheap air travel, and an idea of visiting a new town and playing a little poker was attractive for many gamers.

Many innovations in the first EPT season were invented and implemented on the fly. Casino owners and card club managers certainly knew the mechanics of poker, but they’ve never seen so many players at the same time. The halls were cramped and chaotic; the tiny restaurants could not cope with the inflow of snacks during breaks, and days of play had to be extended for 15-16 hours for allowing the smooth structure of the tournament to be completed on schedule.

Television broadcasts were an important part of marketing, so cameras were built into the side tables in the first season to display pocket cards, as previously done on the WSOP. Members of the film crew had worked in dynamic sporting events before, and here they had to catch the subtle and carefully concealed emotions of poker players. «It was a sport about which we knew nothing», – Dave Corfield, one of the first EPT operators admitted. In order for the rules to be better known, during the breaks, the team studied the book «Poker for Teapots».

The EPT series has changed the landscape of poker far beyond its geographical boundaries. She has brought together Europe’s old-school poker players and the young professionals from the rest of the world who have been the driving force behind the global poker boom into one arena. This series was the first live poker experience for hundreds of thousands of online poker players. EPT played a huge role in the emergence of such poker superstars as Patrick Antonius, Bertrand «ElkY» Grospelier and Justin Bonomo, and has quickly become the main tournament series on the planet.

Black Friday 2011

On April 15, 2011, users around the world came upon an image of the then-top poker rooms – Full Tilt, PokerStars, Absolute Poker, and Ultimate Bet – informing them that these domains had been seized by the FBI.

How did it all start?

When a simple Tennessee accountant, Chris Moneymaker, selected through an online qualification, won the 2003 WSOP Main Event, the US started getting hit just like the rest of the world by an unprecedented poker popularity wave. Within a couple of years, the number of online players and live tournaments has grown tenfold. Beginners started massively to develop their skills by playing dozens of games each day, and the most successful of them began earning money.

In October 2006, the United States enacted the Unlawful Internet Gambling Enforcement Act (UIGEA) as part of the SAFE Port Act.

The UIGEA did not introduce a comprehensive federal prohibition on all forms of online gambling. Instead, it restricted gambling businesses from knowingly accepting certain payments connected with unlawful internet gambling.

Whether the underlying gambling activity was unlawful depended on applicable federal and state legislation.

The law also required the development of regulations obliging designated payment system participants to establish policies and procedures for identifying and blocking restricted transactions.

The UIGEA significantly affected the online poker industry because many banks and payment processors became unwilling to handle transactions associated with offshore gambling operators.

Following the legislation, several major poker companies, including PartyPoker, withdrew from the United States market. PokerStars and Full Tilt Poker continued serving US customers until the federal enforcement actions of 15 April 2011.

Poker rooms reacted to UIGEA differently. Partypoker, the biggest poker venue of that time, stopped serving US customers right away. It had been enough for them to lose their leadership. PokerStars and Full Tilt Poker chose not to restrict American access. Both websites found a kind of «legal loophole» to be able to bypass UIGEA. One of the biggest such “loopholes” was the American billionaire Daniel Tzvetkoff, who allowed his firm to turn into a kind of bank for the country’s 4 largest poker rooms: PokerStars, FullTilt Poker, Absolute Poker, and UniBet Poker. Officially, Tsvetkoff owned a network of large enterprises in the computer field. Actually, he performed all the money transfers of poker rooms using accounts of these firms. That went on until poker room managers started suspecting him of stealing part of the money. It was even decided that Tsvetkoff should be punished, and for that, information about his machinations should be submitted to the US authorities. It turned out that he was facing up to 75 years in prison, but then something happened that nobody expected. Tsvetkoff struck a deal with FBI and disclosed all information about the cash flow at the online poker room. As a result, he came into witness protection and the authorities protected him while he took a hit for the poker rooms.

On April 15, 2011, Preet Bharara, a prosecutor from the Southern District of New York, filed criminal charges against 11 top poker executives and the FBI immediately took their websites down.

PokerStars lost 26% of its total traffic, Full Tilt Poker lost 16%. The case of Absolute Poker and UltimateBet was a little different. By that moment both these poker rooms were a part of Cereus Poker Network included into the top ten most popular poker venues. Being harassed by the US government, they still provided services to US players but paid no more than 10% of the withdrawals. On the poker forums, there were lots of messages about panicked players selling and buying dollars at a fraction of their price on those rooms, those players had been convinced that they could never get their money back; people sold bankrolls at 10 cents per dollar.

Arrest warrants were issued against the founders and financiers of PokerStars, Full Tilt Poker and Absolute Poker/UltimateBet. Initially, he was charged with illegal online gambling. Then there were articles about fraud, financial fraud, money laundering and pyramid scheme organization (Full Tilt Poker owed players about $390 million, while it had only $60 million).

Poker community response

Naturally, these events couldn’t but influence ordinary players. Social networks and forums were full of hot discussions, and people shared their visions of the future of online poker. Some were prone to think that there was no future at all. But there were those who tried to react to the situation with humor. Obviously, it is all the fault of Daniel Negreanu. I told him if he ever started to win online, the world would end», wrote the owner of two WPT titles and two WSOP bracelets Eric Lindgren. Many players lost not only their bankrolls, but all their savings. Since they kept almost all their money in poker accounts. And sometimes the amounts were six-digit. Just before Black Friday I won the FTOPS, and my account was more than a million dollars. It was possible to withdraw exactly zero», – admitted Blair Hinkle.

After effectively blocking all online poker in the US, most American professionals have left the country. Many people moved to Europe. I made the hard decision to leave the country, where I lived my whole life. I had to break up with my beloved girl. I have six figures left on Full Tilt», – told Justin Bonomo later. There were those who never recovered from the financial losses. Chad Batista, a well-known poker professional of that year who had won millions of dollars in online tournaments, fell into a severe depression. By being an introvert, he found his escape in online poker and was ill at ease in the live events. Chad also relocated to another country, but it took a lot on him. Result: alcoholism led to liver and kidney failure; died at 34.

Aftermath

Like any global event, «Black Friday» produced its lot of aftereffects. The main blow, certainly, fell on the main figures of the case. And if PokerStars finally managed to make a deal with the government and withstand a string of financial losses, the rest of the participants did much worse. Following the 2011 Black Friday enforcement actions, Blanca Games, the company associated with the Cereus Poker Network, which operated Absolute Poker and UltimateBet, faced severe financial and operational difficulties.

The affected poker brands were Absolute Poker and UltimateBet, not Unibet Poker.

UltimateBet and Unibet were separate gambling brands operated through different corporate structures.

The Cereus Poker Network effectively ceased operating in 2011 following the US enforcement actions, the freezing of financial assets and the resulting difficulties in meeting player withdrawal obligations.

The failure of Absolute Poker and UltimateBet should be distinguished from the situation involving PokerStars, which continued operating internationally and reached a settlement with the US Department of Justice in July 2012. The 2011 Black Friday enforcement actions fundamentally changed the United States online poker market, but they did not result in the permanent disappearance of regulated online poker.

In July 2012, PokerStars reached a settlement with the US Department of Justice that included the acquisition of Full Tilt Poker’s assets and arrangements to reimburse eligible former players.

Full Tilt resumed operations under PokerStars ownership in November 2012. In May 2016, Full Tilt’s poker games were integrated into the PokerStars player network.

On 25 February 2021, the Full Tilt brand’s standalone desktop and mobile applications were discontinued. Existing account information, balances, tickets and bonuses remained accessible through PokerStars. This was a brand consolidation rather than a liquidation of Full Tilt caused solely by declining traffic.

Meanwhile, several US states established regulated real-money online poker markets.

By October 2026, regulated online poker was operational in jurisdictions including New Jersey, Nevada, Delaware, Pennsylvania, Michigan and West Virginia, subject to the relevant licensing and operational arrangements.

The Multi-State Internet Gaming Agreement (MSIGA) enables eligible licensed operators in participating states to share poker player liquidity under approved interstate arrangements.

On 1 April 2026, the Michigan Gaming Control Board approved FanDuel’s launch of multi-state online poker using the PokerStars brand, connecting eligible players in Michigan, Pennsylvania and New Jersey.

Online poker is therefore not universally prohibited throughout the United States. Its legality depends on the player’s physical location, the operator’s authorisation and the applicable federal and state regulatory framework.

Black Friday Effects on PokerStars

The Manhattan Federal Attorney’s Office accused Isaiah Scheinberg, the founder of PokerStars, of a series of illegal actions that led to Black Friday 2011, the suspension of PokerStars and the bankruptcy of its main rival, Full Tilt Poker. In this case, charges were brought against ten other persons, all of whom sooner or later pleaded guilty.

«Foreign companies that choose to work in the United States cannot ignore laws that they do not like,» said federal prosecutor Prit Bharara when the defendants in this case were charged.

After Black Friday, Full Tilt Poker went bankrupt and failed to pay players $330 million in deposits. Bharara called Full Tilt a pyramid scheme, but worked with Sheinberg to find a solution. As a result, PokerStars bought Full Tilt for $731 million, and Starzov’s property claims were removed. The Justice Department used the money to return the bankrolls to American players, and PokerStars reimbursed the lost bankrolls to «Full Tilt» players from other countries. Among online poker players, Scheinberg became a folk hero. However, despite his help in the Full Tilt case, federal prosecutors did not stop pursuing Sheinberg. His son Mark sold PokerStars for $4.9 billion in 2014. The voluntary surrender of Sheinberg to the US authorities marked the end of one of the craziest sagas in the history of the Internet.

Isaiah Scheinberg’s Story

Although Sheinberg is a closed person (there are only a few pictures of him and no interviews), he is not a normal person.

Isay was born in the Lithuanian SSR, in the 1960s he graduated from Moscow State University and then emigrated to Israel, where in 1973 he took part in the «Yom Kippur war» against the Arab countries.

After completing his military service, he joined the Israeli branch of IBM, and in 1983 he was invited to work at the company’s Canadian office in Toronto. Scheinberg, a talented programmer, played a key role in the development and implementation of Unicode, a universal character encoding standard for written languages.

Like many of his generation’s mathematical intellectuals, Scheinberg was an avid poker player. He was particularly fond of tournaments, and in 1996 Isay even played in the World Series of Poker in Las Vegas.

In 2000, Scheinberg founded PYR Software in Toronto to develop and sell software to online poker operators, but was unable to find customers in this nascent industry. Then a year later, at the height of the «dot com boom», he and his son Mark founded their own online poker room PokerStars. Mark co-wrote the concept and was the managing director of Rational Entertainment Enterprises. It was located, like many online gambling competitors, in
Costa Rica
.

The PokerStars Internet platform, operated by Rational, began operations on September 11, 2001, the same day that terrorists hijacked the towers of the World Trade Center in New York City. Coincidentally, almost a decade later, one of the «September 11th Heroes» won $1 million in a PokerStars-sponsored poker show with Fox. It was former New York police officer Mike Kosovo, who was among the first to come to the aid of the people at the World Trade Center. The software developed by Scheinberg’s PYR Software and subsequently used in PokerStars was unique because it included online tournaments. There were cash games, too, but it was the PokerStars tournaments that attracted so many players. For little money, often less than $25, they could play the freezeout and have a chance to make a big score without risking much money. Players also enjoyed the tournament format itself, in which players were eliminated alternately and the survivors continued until all chips went to the winner. In the summer of 2002, the Stars hosted the first World Championship of Online Poker (WCOOP), an online equivalent of the World Series of Poker (WSOP).

First US claims

During the early 2000s, PokerStars became one of the largest online poker operators, competing primarily with PartyPoker, which was operated by PartyGaming.

PartyPoker held a leading position in the online poker industry before the adoption of the US Unlawful Internet Gambling Enforcement Act (UIGEA) in October 2006.

Following the introduction of UIGEA, PartyGaming withdrew its real-money poker services from the United States.

PokerStars and Full Tilt Poker continued accepting US players, substantially increasing their positions in the international online poker market.

However, their continued operations in the United States subsequently became the subject of federal enforcement actions.

On 15 April 2011, the US Department of Justice announced criminal charges against individuals associated with PokerStars, Full Tilt Poker, Absolute Poker and their payment processing arrangements.

These proceedings significantly changed the structure of the international online poker industry and led to PokerStars withdrawing its unlicensed nationwide US operations.

However, the US Department of Justice did not approve of foreign online poker rooms operating in the country. It officially took the following position: Online Poker violates the 1961 law prohibiting cross-border bets (both across the US border and across state borders) using wired communication.

However, PokerStars and PartyGaming continued to serve American players. So did Full Tilt Poker, promoted and managed by renowned professional players Howard Lederer and Chris Ferguson along with Ray Bitar, Ferguson’s former stock exchange colleague. These major poker rooms advertised themselves on television, promoted television broadcasts, and sponsored top poker players. Ambasador Starzov became a famous sports star: tennis players Rafael Nadal and Boris Becker, footballers Gianlugi Buffon and Ronaldo, baseball legend Orel Hershiser and others. For a few years in the early 2000s, when PokerStars was advertised on television and a credit card was enough to register, the US government seemed to turn a blind eye. For their part, online poker rooms argued that the 1961 Act applied only to sports betting and not to poker. They also argued that another federal law, «Illegal Gambling», did not apply to poker because it was a game of skill, not luck. PokerStars, which moved their headquarters to
the Isle of Man
, received legal opinions from leading American law firms confirming this legal position. Scheinberg also moved to the Isle of Man and officially became the technical director of PokerStars.

In March 2006, billionaire Calvin Air, owner of the offshore online bookmaker Bodog, appeared on the cover of Forbes magazine. In that issue, he had an article called «Catch me if you can». Son of a Canadian pig farmer, Er moved to
Costa Rica
and turned the modest Bodog into a powerful bookmaker, starting to take bets from American players. In that article, «Forbes» wrote about Era’s billionth state, noting that Bodog apparently violated the 1961 law.

Tougher Laws and Attempts to Bypass Poker Rooms

A few months later, the
United States Congress
passed the Suppression of Illegal Online Gambling Act. The law frightened the conservative board members of PartyGaming, and the company left the lucrative US market. The stock fell and has not recovered since. In 2009, PartyGaming, which, in addition to offering poker to American online casino players, made a deal with the American authorities and paid a fine of $105 million in exchange for refusing to prosecute.

Scheinberg, on the other hand, managed a private company that offered only poker to its customers. In fact, the Suppression of Illegal Online Gambling Act 2006 made it illegal to engage in related money transactions rather than online gambling per se. Because of this, the number of available deposit and cache options for Americans decreased, but they continued to play on offshore sites. With the departure of PartyPoker, PokerStars immediately seized the US market and became the world’s largest online poker room. Only Full Tilt, who also decided to continue working with the Americans, competed heavily.

Schoenberg hired Dick Gefardt, a former House majority leader, as a Starze lobbyist in Washington, D.C., and by 2010, the room was making a net profit of $500 million a year at $1.4 billion.

However, the huge sums of money that PokerStars was handling continued to keep the Justice Department, especially the Manhattan prosecutors, in the limelight. Lawmen, led by young AUSA Arlo Devlin-Brown, found a weakness in offshore poker schemes – these were huge cash flows from players and back through the US financial system. Most banks and credit card companies refused to service their gambling transactions, so PokerStars and Full Tilt had to rely on small payment services that did not shy away from making questionable payments for a generous reward.

In 2009 and 2010, the Federals seized tens of millions of dollars from companies that serviced the cash flow of poker rooms. Some of these firms have even been charged and assets seized.

The big scandal was caused by the use of false MCC codes for bank card payments, which were used to transfer money from players to poker rooms and back. To hide the true purpose of the payment from the American issuing bank, another code was used, which made it look like the money was being transferred to pay for flowers or animal goods, rather than to the poker site. This technique has been used by Full Tilt since its inception, which has helped them quickly expand their player base, but PokerStars has always said they have not done this.

Yet, because poker rooms were not underground, but in the gray zone, and influential politicians like Barney Frank were working to legalize online poker, the industry viewed the obstacles posed by federal prosecutors as merely a costly inconvenience. «The federal government is not going to take any action against the poker rooms to prevent their collapse,» said Frank Catania, then head of the New Jersey State Gambling Commission and an online gambling consultant.

Black Friday 2011 for PokerStars

But on Friday, April 15, 2011, Manhattan federal prosecutors dropped an atomic bomb on the online poker industry. This day would henceforth be referred to as Black Friday by poker players worldwide. Federal prosecutor Preet Bharara has indicted 11 businessmen, among them Sheinberg, Bitar, and other executives of PokerStars, Full Tilt, and Absolute Poker. Also indicted were four men operating the gateway along with a banker. None were charged under the 1961 Wire Call Ban Act. Instead, the state charged Scheinberg under the newer Illegal Gambling Act along with criminal conspiracy to commit bank fraud and money laundering. However, his son Mark was never indicted.

The Feds have been creative and even arrested domains of all three rooms – PokerStars, Full Tilt and Absolute Poker. Millions of poker players tried to log in to the traditional Friday roller, but instead saw on the monitor screen a notice that their favorite poker site had been confiscated by the FBI. Players’ bankrolls were frozen. Even against PokerStars, the state filed a civil lawsuit. A few months later, Rod Rosenstein, then a federal prosecutor in Baltimore indicted Calvin Eru, founder of the online bookmaker Bodog, who at one time may have hastened the approach of Black Friday.

If Sheinberg was shocked by this development, Bharara and his prosecution team were also taken by surprise when Full Tilt Poker went bankrupt and failed to pay the $330 million players who were on their accounts. Bharara filed a civil suit against head of «Full Tilt» Ray Bitar and his two partners – professional poker players Howard Lederer and Chris Ferguson. The prosecutor accused the three of using players’ bankrolls to pay $440 million in dividends to owners and board members. Ferguson hates the poker community so far that it made him even miss a few WSOP seasons.

Following the US Black Friday enforcement actions of 15 April 2011, PokerStars reached arrangements with the United States Department of Justice that allowed it to return account balances to eligible US customers.

On 31 July 2012, PokerStars and Full Tilt Poker entered into civil settlement agreements with the US Department of Justice concerning the money laundering and forfeiture proceedings initiated in April 2011.

Under the settlement, PokerStars agreed to forfeit USD 547 million to the US government and make approximately USD 184 million available to reimburse Full Tilt Poker customers located outside the United States.

The total financial obligations associated with the settlement amounted to approximately USD 731 million.

In exchange, PokerStars acquired the forfeited Full Tilt Poker assets from the US government.

The settlement also established arrangements for reimbursing eligible US Full Tilt customers through a process administered by the Department of Justice.

Importantly, the civil settlement did not constitute an admission of wrongdoing, criminal liability or guilt by the settling parties.

The agreement also required PokerStars founder Isai Scheinberg, who remained under criminal indictment, to cease serving in management or director positions within the company.

The criminal proceedings against Scheinberg were resolved separately in 2020.

The USD 547 million forfeiture and the approximately USD 184 million allocated to foreign player reimbursement should therefore not both be described as criminal fines.

Over the next several years all state defendants in the «Black Friday case» with the exception of Sheinberg pled guilty to everything from misdemeanors all the way to bank conspiracy. The owners of the payment locks received the longest prison sentences – up to three years. But overall, the penalties filed against the online poker operators were minimal. The head of Full Tilt, Ray Bitar, pleaded guilty to conspiracy to commit bank fraud and, given the time he had served in custody, was released from the courtroom partly because of concern about his heart disease. He also accepted the $40-million fine. Scott Tom, president of Absolute Poker, who, like Full Tilt failed to pay bankrolls to players, pleaded guilty to an offense. So did Calvin Air, the billionaire and bookie owner of Bodog, who accepted bets from American players. He was even allowed not to appear in an American court, but to plead guilty in his lawyer’s office in Vancouver, Canada.

PokerStars Sale

When Isaiah’s son Mark Scheinberg took over the official leadership of PokerStars, the room continued its business in the Isle of Man but stopped serving American players. Soon, Mark began to receive frequent calls and visits from a young director of a tiny company in Montreal engaged in the development of online gambling software named David Baazov. Baazov wanted to buy PokerStars backed by Blackstone Group – the world’s biggest private investment company. Simultaneously, the state gambling regulator of New Jersey, which legalized online poker in 2013 – joined afterwards by Nevada and Delaware, denied several times granting PokerStars a license because of a relationship with Scheinberg who was ready to pay an unspecified just price for the license.

Finally, when Blackstone negotiators finally got their first look at PokerStars’ financials, they realized how Scheinberg had built one heck of a company.

Even after its expulsion from the United States, the room earned $400 million a year, courtesy of annual revenue of $1.1 billion.

PokerStars had 89 mln users registered, about 5 mln of whom visited the site at least once a month, and it easily passed the cybersecurity audit. To crown it all, by that time, 500,000 online tournaments were held every day in the Starzes.

In August 2014, Canadian online gambling company Amaya Gaming completed the acquisition of Oldford Group Limited, the parent company of Rational Group, which operated PokerStars and Full Tilt Poker.

The transaction was valued at approximately USD 4.9 billion and represented one of the largest acquisitions in the online gambling industry at that time.

The acquisition transferred ownership of PokerStars from the Scheinberg family to Amaya Gaming.

In 2017, Amaya adopted the corporate name The Stars Group Inc., reflecting the importance of PokerStars and its expanding portfolio of online gaming brands.

A further major ownership change took place on 5 May 2020, when Flutter Entertainment plc completed its all-share combination with The Stars Group.

The transaction brought PokerStars into the same international gambling group as Paddy Power, Betfair and FanDuel.

As of October 2026, PokerStars remains part of Flutter Entertainment plc, a publicly traded international sports betting and gaming group listed on the New York Stock Exchange.

The PokerStars business operates through jurisdiction-specific legal entities holding the relevant gambling permissions.

The 2014 sale to Amaya and the 2020 combination with Flutter should be presented as two separate events in the company’s corporate history.

Online Poker in the US After Black Friday

The regulation of online poker in the United States has evolved through a combination of federal court decisions, state legislation and regulatory licensing programmes.

In 2018, the US Department of Justice adopted a revised interpretation of the Federal Wire Act of 1961, suggesting that certain provisions could apply to forms of online gambling beyond sports betting.

This interpretation was challenged in litigation involving the New Hampshire Lottery Commission.

In June 2019, the United States District Court for the District of New Hampshire ruled against the broader interpretation of the Wire Act.

On 20 January 2021, the United States Court of Appeals for the First Circuit affirmed the judgment, concluding that the relevant Wire Act prohibitions apply to betting on sporting events or contests.

The ruling helped reduce legal uncertainty concerning certain interstate non-sports gambling activities, but it did not establish a nationwide federal authorisation framework for online poker.

Individual states retain responsibility for determining whether regulated real-money online poker may be offered within their jurisdictions.

By October 2026, several US states had established regulated online poker markets, while other states continued to prohibit or restrict the activity.

Approved interstate arrangements, including the Multi-State Internet Gaming Agreement, allow qualifying operators to pool players across participating jurisdictions.

The historical debate over the Wire Act should therefore be described in the context of completed judicial proceedings and existing state-level regulatory systems, rather than as an unresolved political dispute.

The legal dispute concerning the interpretation of the federal Wire Act was resolved in favour of a narrower interpretation applying the statute’s relevant prohibitions to sports betting.

In 2019, the US District Court for the District of New Hampshire rejected the Department of Justice’s 2018 interpretation that sought to extend the Wire Act’s application beyond sports betting.

On 20 January 2021, the United States Court of Appeals for the First Circuit affirmed the district court’s judgment in New Hampshire Lottery Commission v. Rosen.

The appellate proceedings are therefore no longer pending.

However, the ruling did not establish a universal federal right to operate online poker throughout the United States.

Real-money online poker continues to be regulated primarily through state-specific legislation, licensing frameworks and approved interstate arrangements, alongside applicable federal law.

The criminal proceedings against PokerStars founder Isai Scheinberg arising from the 2011 Black Friday investigation were concluded in 2020.

Scheinberg, who had been indicted in April 2011, surrendered to US federal authorities on 17 January 2020 after withdrawing his appeal against extradition.

On 25 March 2020, he pleaded guilty before the United States District Court for the Southern District of New York to one count of operating an illegal gambling business in violation of 18 U.S.C. § 1955.

The guilty plea concerned the provision of unlawful internet gambling services to US customers before PokerStars withdrew from the market in 2011.

On 23 September 2020, US District Judge Lewis A. Kaplan sentenced Scheinberg to time served and imposed a USD 30,000 fine.

No additional prison sentence was imposed.

The judgment concluded the criminal proceedings against the last of the 11 defendants originally indicted in connection with the 2011 Black Friday investigation.

These criminal proceedings must be distinguished from the 2012 civil settlement reached between PokerStars and the US Department of Justice, under which PokerStars acquired the forfeited Full Tilt Poker assets.

As of October 2026, the original Black Friday criminal proceedings against Scheinberg are no longer pending.

Regulated United Europe (RUE) provides legal and regulatory consulting services to businesses planning to establish licensed online poker platforms and other online gambling operations.

Our legal team assists clients with selecting an appropriate jurisdiction, establishing corporate structures, assessing applicable gambling legislation and preparing applications for the necessary regulatory authorisations.

The regulatory requirements for operating an online poker platform depend on the jurisdictions where the operator is established and where its customers are physically located.

A gambling licence issued by one jurisdiction does not automatically permit an online poker operator to accept players from every country.

Depending on the applicable legislation, operators may be required to obtain separate national or regional authorisations before offering real-money poker services.

The principal compliance requirements may include:

Gambling Authorisation: Obtaining the licences necessary for the intended poker products and target markets.

Technical Certification: Ensuring that poker software, random number generation mechanisms and relevant gaming systems meet applicable technical standards.

Player Verification: Implementing age verification, identity verification and customer due diligence procedures.

AML/CFT Compliance: Establishing financial crime prevention controls, transaction monitoring and suspicious activity reporting arrangements.

Player Fund Protection: Maintaining appropriate arrangements for the custody, segregation and withdrawal of customer funds.

Responsible Gambling: Implementing deposit limits, self-exclusion, customer interaction and other player protection measures required by the relevant regulator.

Payment Processing: Establishing compliant relationships with banks, acquiring institutions and payment service providers.

Data Protection: Complying with applicable privacy and information security requirements.

Cross-Border Operations: Verifying the legal conditions for accepting players in each target jurisdiction.

RUE assists gambling businesses with these regulatory and organisational processes. The granting of a gambling licence remains subject to the independent assessment and approval of the competent regulatory authority.