Australian online poker payment processor Daniel Tzvetkoff received a sentence of time served today in New York City federal courtroom, in relation to his operation of Intabill, which provided processing services for Full Tilt Poker, PokerStars, and other online sites in 2008 and 2009.
Tzvetkoff, 31, was in his early 20s when he co-founded Intabill with the help of Aussie lawyer Sam Sciacca, and with the help of US-based associates, the firm quickly rose to the top of the international online-poker processing hierarchy. The firm failed just as quickly, however, with Tzvetkoff’s lax bookkeeping and luxurious lifestyle — he bought a $28 million mansion on Australia’s exclusive Gold Coast — contributing factors to why firms eventually fled to other processors.
Intabill eventually defaulted on at least $80 million in unpaid processing funds, at least $40 million of which was owed to Full Tilt, which sued Tzvetkoff after Intabill’s collapse. Later, in April of 2010, Tzvetkoff was arrested at an e-processing conference in Las Vegas, and turned state’s evidence after seventeen weeks in prison while awaiting initial trial. Tzvetkoff faced up to 75 years in prison on two counts, one bank fraud/money laundering and the other regarding the operation of an illegal gambling business.
Tzevtkoff faced the possibility of a few more months in federal custody, as the applicable sentencing guidelines for his range of crimes suggested a sentence of six to twelve months. However, Judge Lewis A. Kaplan decided that the four-plus months already served was sufficient, in light of Tzvetkoff’s extensive cooperation and subsequent employment in Australia.
Tzvetkoff had also agreed to forfeit $13 million in proceeds derived from the Intabill operation, which was at its peak in 2008 and 2009.
Tzvetkoff agreed to help federal investigators decipher and link more than 90,000 documents, largely electronic e-mails and transfer verifications that had been obtained as part of the investigation into how offshore poker sitesc ontinued to offer immediate transaction prosecution to US residents after the passage of the UIGEA, which was designed to curtail such instantaneous processing activity.
Despite being a high-profile informant — numerous stories depicted him as the man who caused online poker’s “Black Friday” — three of Intabill’s US business associates were arrested in December 2009, proof that Intabill was on the Department of Justice’s radar long before Tzvetkoff’s own arrest.
Andrew Thornhill, Curtis Pope, and John Scott Clark are other US-based payment processors that worked hand-in-hand with Tzvetkoff in helping the poker sites serve US customers, and all three were indicted on December 14th, 2009. Thornhill eventually served three months in prison, Clark (like Tzvetkoff) received a time-served sentence, and Pope received 21 months after violating the terms of what appears to be a similar plea deal, in connection with a related payday-loan operation and its fraudulent failure.
One of the three is likely the person who informed FBI agents that Tzvetkoff was present at the April 2010 e-commerce conference where he was arrested. Several sources, both public and private, have offered Thornhill as the likeliest earlier cooperating witness. (A fourth US payment-processing figure who was another part of the same group, Jeff Nelson, was subsequently named by Black Friday defendant Chad Elie as another cooperating witness.)
The sentences given to Clark and Thornhill are very similar to that handed don to Tzvetkoff today, and continues to close the story of the years-long chain of processing seizures and arrests that led to 2011’s infamous Black Friday. Three of the 11 individual Black Friday defendants remain outside US jurisdiction — Scott Tom of Absolute Poker and Isai Scheinberg and Paul Tate of PokerStars. Two others have yet to be sentenced, while the others have all pled guilty and received sentences ranging from time served to three years, depending on their level of cooperation.
Tzvetkoff himself will likely return to Australia in the near future, where he woks as the chief technical officer (CTO) for what his attorney referred to as a “responsible company” in a pre-sentencing brief. Tzvetkoff acknowledged doing some post-UIGEA work for Australian “pokies king” Bruce Mathieson. Mathieson opened up his own Australian-based online payment processing firm in 2009, but steered clear of both online poker and the post-UIGEA American market.
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