PokerStars Co-Founder Isai Scheinberg Finally Surrenders to Federal Prosecutors

January 27th, 2020 | by Jason Reynolds

PokerStars CO-founder Isai Scheinberg as surrendered to the US authorities after nine years on the Department of Justice’s (DOJ) wanted list.

PokerStars co-founder Isai Scheinberg has finally given up and surrendered to US federal prosecutors. (Image: PokerStars)

The 73-year-old started the final chapter of his long-running saga with federal prosecutors on Jan. 17. Flying from Switzerland to New York, Scheinberg was greeted by federal agents and taken into custody.

News of move was first made public by Forbes on Jan. 24. Since then, Scheinberg’s story has become a major talking point in the online poker community.

Isai Scheinberg Enters Not Guilty Plea

As it stands, the man who co-founded PokerStars will answer to criminal charges relating to gambling, bank fraud and money laundering. He appeared in Manhattan federal court on Jan. 17 and entered pleaded not guilty to all charges.

He was subsequently released on $1 million bail and will now go underway what has been described as a two-way legal discussion. Speaking to Forbes, federal prosecutor Olga Zverovich said that an “agreement in principle” has already been reached.

Scheinberg has avoided US soil since former Attorney for the Southern District of New York Preet Bharara opened his now famous indictment. However, he’s not been completely under the radar. In a strange twist of fate, the former PokerStars head honcho cooperated with Bharara to clean up the Full Tilt debacle.

With Black Friday bringing down Full Tilt in 2011, Scheinberg spearheaded a plan to compensate players. Although PokerStars was indicted alongside Full Tilt, Scheinberg worked with Bharara to agree a $731 million takeover.

Goodwill Gesture No Help for Isai Scheinberg

The acquisition settled a civil forfeiture proceeding and not only kept Full Tilt alive but allowed US players to withdraw their bankrolls. Despite throwing everyone involved a lifeline, Scheinberg wasn’t off the hook. In fact, even after Mark Scheinberg sold PokerStars to Amaya for $4.9 billion in 2014, the case still wasn’t closed.

Fast-forward to the start of 2020 and a resolution is now on the cards. The agreement referenced by Zverovich suggests that a prison term is unlikely. However, the man behind online poker’s biggest brand could face a substantial fine.

Regardless of the outcome, the news should close the chapter on one of online poker’s darkest hours. Although the industry has come a long way since the shock of 2011, it’s never fully recovered.

With much of the US still unable to play online poker and other countries reeling from the fallout, things have changed since the industry’s heyday. However, once the DOJ gets what it wants, it will be a chance for everyone to start afresh and continue the rebuilding process.