What the US does with online poker players' seized funds. | Hacker News Reader

What the US does with online poker players' seized funds.

odenton.patch.com

70 pointsnoduerme64 comments

This is appalling.

In my opinion, the police and/or any governing body should absolutely not have any kind of financial interest in people committing crimes. They're there to prevent crimes, not profit from them.

Consider speed cameras. What does my local government (Tempe, Arizona) have a higher interest in: earning revenue from speed cameras, or stopping speeders? It would cost them money to stop speeders (in the form of lost ticker revenue). If they keep people speeding, they keep collecting money.

Any fines or seized funds should be given back to the community in the form of a tax rebate, not kept by the governing body as a financial incentive.

(This is a financial incentive for the community overall, and I understand that this is also a problem. However, I feel like giving money back to those you supposedly committed the crime against [the people] is better than the alternative)

Presumably there is a degree to which the local community is willing to be taxed; the more rebates they can expect, the more you can increase that tax.

My point is that reducing taxes with rebates, and keeping those revenues, amount to the same thing economically.

You would literally have to amend the tax code every time a disbursement check was issued. If you did this monthly, or quarterly, it would be impossible to raise taxes in accordance with tickets.

Or, you could just require community service instead of money for all tickets.

I think you're being a tiny bit silly in your objection; the amount of rebate will, in all probability, be a normal distribution and will be in a reasonable range to a high degree of certainty. If you get a rebate of 90 one year, but 110 the next, you may not find an additional tax burden of 100 especially onerous, particularly if it builds up in an incremental way.

I have only a little idea of what counts as community service in the US, but from what Wikipedia lists, community service labour would enable cutbacks in state expenditure in those areas.

The money should go to part of the government which are not responsible for enforcing the law for which the money was collected. Even if spread over the entire government, including the police department, it would dilute the amount enough to severely reduce the improper incentive.

So if we posit that the money shouldn't go to the police or the government in general, where should it go?

schools, like the lotto.

I would also accept: parks, and bike paths.

In all honesty, I'd be totally happy if the money went into a fund that was used to throw a block party for the town at the end of the year.

I would point out that by sending lottery money to schools, we're (to some degree) incentivizing schools to produce mathematically illiterate people.

One might say the same for sending criminals' money to schools.

I don't think this is true. Lottery revenue is significantly less than all school funding, so while we nominally send lottery revenue to schools, saying that we do so doesn't really mean anything because money is fungible. Schools could only benefit if they could produce so many innumerate (but moneyed) people that the total revenue of the lottery exceeded their total funding.

I would like to see some evidence behind this, as the argument is a straw man in my opinion.

In my state, taxes collected on Alcohol and Tobacco are both sent into the pool marked for education, yet we have the lowest smoking rate in the country and are among the 5 states with the lowest number of drinkers. With your logic, the only thing I can attribute to the statistical numbers is a poor education system because not enough people drink or smoke, which indirectly makes the education system worse and fails to teach people to smoke and drink in order to get a better education.

I'm sorry. This just doesn't make sense. Education systems don't "profit" from the few alcoholics and few smokers here. Claiming that taxes from lotteries or gambling will incentivize schools into failing to teach children to count or be responsible with money is way too far fetched for me to grasp. The time frame from when a child is in school learning math to when they are legally able to buy a scratch card at the corner gas station is too far apart. If you have some evidence that shows that I am wrong, please let me know.

On the other side of the coin, with this article, the ones that are receiving the money taken during drug busts or in this case online gambling ring busts are the ones that end up with the money. It's not laundered through every different department before it hits the city wallet, usually weeks later, not years or even decades.

I more or less agree with you. My original comment was sort of tongue-in-cheek :-) I've heard other people make that same proposition with apparent sincerity, though.

In some states it is supposed to go to schools, so the police departments route it through the fed and back to them instead.

Funds to provide for the victims of violent crime.

Actually some common law precedent for that: http://en.wikipedia.org/wiki/Deodand

It should be refunded at the end of the year to all residents (equal amounts to each person).

The residents are the ones impacted by crime, so they are the ones who should get reparations.

If the money goes to residents, then they have incentive to criminalize things.

The money should vanish, or be held in escrow, or something that dimishes the incentive to ANYONE to benefit from someone being penalized.

A: That's impossible to do. B: They do not have incentive to criminalize things.

A resident who criminalizes looses far more than they could possibly make. A resident who encourages criminal activity also looses more than they could make.

And if the money vanishes (for example they burn it) then that reduces inflation which is exactly equal to giving it to everyone in the country. So you might as well give it directly because different area have different levels of crime.

what is wrong with just burning (voiding) the money?

That's really the same thing. They can print more, so it ends up in the hands of the state anyhow. Maybe one could buy a commodity (oil, say) and burn it, and maybe plant some trees too.

So how much money would they get if online gambling were legal and taxed. I would bet it's a TON more.

But we're Americans. We can't think further than 3 seconds into the future. Thanks for stealing my poker money guys, you're really looking out for the people.

They (the police) would get nothing if gambling was legal. Gambling revenue goes into the general fund and typically offsets tax cuts or increased spending in some other area. Police departments only benefit when a crime is committed, because they can seize property without losing any of their already allocated funding.

Also politicians likely get kickbacks from the big players in gambling to the little guys down.

Interestingly, a lot of people who were making a living from online poker WERE paying taxes on that money. Come April 15th, the IRS doesn't care how you got it.

If you report income as coming from sale or manufacturing of illegal drugs (or similarly illegal organized crime type business), you go to gaol. I'm not sure how to properly report drug money on a tax return, though.

>I'm not sure how to properly report drug money on a tax return, though.

You don't, they just nail you for tax fraud (a felony) when you go down.

This is just a way to prosecute people without having to collect all that pesky evidence.

The picture of the policemen holding a giant check is embarrassing. $470k seized illegitimately from the citizens they are paid to protect...imagine what that check is like for larger cities. What about policemen that play online poker? How can counties be paid off when Full Tilt and other poker entities are promising to pay out their players as well?

The practice of stealing money from random people who aren't engaged in any illegal activity is actually fairly common among law enforcement already. The rationale given thus far is that "That money was for the purchase of illegal drugs," or if that will not work, they will simply illegally sieze something and refuse to ever schedule a meeting to let the citizen reclaim it, or illegally sieze something and "lose" it. There's no recourse for citizens because asset forfieture, busy schedules, and losing things are legal.

The only difference between the police and traditional organized crime is scale.

Not really. There is a large portion of the population that believes that the police aren't bad.

The same can't be said of organized crime.

I think that is the case in Japan.

It was also, at least in some points in history, very much the case in Sicily.

"a large portion"

Scale.

They're bigger, and they have more turf. They present themselves as authority figures.

It's not terribly unheard of for 'Mafias' to have have neutral to positive public opinions in their "neighbourhoods". For the police, the nation is their neighbourhood.

There was a time in the 50's when some "wise guys" tried to establish themselves in my city (in South America). My grandfather worked with a brother of a capo and told me that when they where getting started, the police came over and told them that the only ones allowed to bribe/extort where the police themselves. To this day, there's no organized crime in my city except from the police. And that's just one of the stories I know...

I'm sure the families of police officers who've died protecting others would disagree with you.

I understand the dissatisfaction with the things that have happened to law enforcement over the years, but it is a far, far cry from being the same thing as organized crime. I'll disagree at great lengths with those who would abuse the system with things like the article linked, no knock raids, abuse of due process, and the myriad issues with the legal system, but honestly making that kind of blanket normalization is poisonous to not only improving the state of things, but the many, many, MANY good things our law enforcement organizations DO do for the communities they serve.

To put the risk assumed by being in law enforcement into some perspective, here are some industries that saw more incidences of fatal occupational injuries due to "Assaults and violent acts":

Food Services.

Transportation and Warehousing.

Grocery Stores.

Retail.

...and more.

So next time you decide you must have some nice pepperoni pizza, tip your local pizza delivery guy nicely and make sure to thank him for his service to this country.

EDIT: citations are fun: http://www.bls.gov/iif/oshwc/cfoi/cftb0241.pdf

Protecting whom exactly? There are communities in the U.S. where the police are pretty much an occupying force.

While the modern state has evolved large social, legal, and welfare apparatuses, these can all be thought of as the PR department for the dominant gang in the region. It still comes down to guns and greed. Incidents like these are reminders.

This is hyperbolic bullshit. Keep it on Reddit.

It is my belief that governance is just another form of tyranny. Government is not conceptually philosophically different from gangs, and if you look at how the police operate in practice there are massive parallels (such as, but not limited to, their "look out for our own" attitude: http://www.youtube.com/watch?v=gH9k8L3oDa4).

"hyperbolic"

My point is that the only difference is scale. The difference in scale in this case happens to be somewhat extreme, so perhaps that is why you think I'm being hyperbolic... I'm not.

Furthermore, I've never regulated Reddit.

I will not descend into an extremist philosophical debate to decide the validity of a plainly factually wrong comment.

I hope that other readers will follow suit and am frankly insulted that you think that the readers of Hacker News are stupid enough to buy into such a plainly ignorant comment.

Edit: Burgerbrain is correct, this comment was far too mean spirited. I will not change my comment because I believe editing robs context and rewrites history. I however continue to support the feeling that I had when writing this post, which is that I feel extremist philosophical debates are both off-topic and bring down the overall level of discussion on HN.

You have some way of choosing to not participate in a discussion...

You should really knock it out with the namecalling however, because that is below HN. I am not the only person here expressing and backing up this general sentiment. If you don't want to discuss it like a reasonable adult, and don't want to read other people discuss it, then just move along. I don't have to take verbal abuse from you.

This is a terribly presumptuous thing to say. Police and organized crime may exhibit similar behaviors and methods, but the police are at least supposed to have an ideal to sustain. Admittedly, they don't always do that. But if it's not the police, it will be organized crime in charge, and I'll take my chances with the police.

I did not realize that the cases where closed and all. What happens if they are found not guilty and try to get the money back? While the other 200K they usually get is probably from small amounts not worth the fight. These are huge sums that the defendants probably will fight for.

https://secure.wikimedia.org/wikipedia/en/wiki/Asset_forfeit...

Short story: In the US, you're fucked. If they want it, they take it (and 'legally'!) Even if you are proven innocent, you're still out of luck. They don't even go to court with you for your stuff, they go to court with your stuff (which conveniently doesn't have rights).

Due process doesn't exist.

If you read the article, it says it has nothing to do with the closure of the large poker sites last month.

To clarify a couple of points:

- No 'large poker sites' were closed last month. PS, FT and Cereus network pulled out of the US industry after the Black Friday indictments. All 4 sites involved continue to operate today to non-US customers.

- This asset sharing was due to the county police's involvement in to the "Blue Monday" seizures that occurred ten days ago. It's a separate round of bank seizures and domains, but to say it "has nothing to do" with the proceding Black Friday is inaccurate.

Although the funds seizure were due directly to Anne Arundel County Police's involvement in to the Blue Monday incictments, the actual $500k was from other bank seizures that occurred over a year ago.

http://pokerfuse.com/news/law-legislation/county-police-mary...

[disclosure: I am the cofounder of pokerfuse]

Read the comments. Every single one of them. Wow.

I have not seen the reputation of the US federal government so low since I was a little kid seeing Viet Nam, Nixon, and Watergate play out on TV. But there's not even a particularly hot war going at this point.

>But there's not even a particularly hot war going at this point.

war on drugs, war on terror, and a couple real wars - i.e. Afganistan and Iraq - seems more than enough ways to "appropriate" money. Several "slow" long "wars" are much more profitable than 1 short "hot" war.

Pretty sure it was actually Nixon who actually invented the "War on [undefeatable abstraction]" with his "War on Cancer".

> a couple real wars - i.e. Afganistan and Iraq

Don't forget Libya ... plus the handful of other countries over in that region where our troops have always been stationed, or were recently deployed in response to the instability.

why is it illegal to gamble online and legal in physical world ?

why is it ok to fund police departments with seized goods? Seems like a bit of conflict of interest.

Sounds like a helluva business model to me.

Indeed, asset forfeiture is nearly as lucrative as fraudulent foreclosure, paying legislators to make people give you money, or threatening the destruction of the global economy. I would definitely like to get in on the racket, as long as I have no power to prevent it. Unfortunately I am not a police department, bank, or insurance company.

It is legal wherever they are able to effectively take their cut... err, I mean tax it.

Furthermore, how it competes with the gambling institutions they own ("lotteries") is also taken into consideration.

It's not the lotteries. Make no mistake, it's the brick-and-mortar casinos and their bottomless cash bags.

That's certainly the case in states where brick-and-mortar casinos are legal. I'm not familiar with their status in Maryland however. Just about all states have "state lotteries" as far as I know though.

My guess is that even if Maryland doesn't have casinos, New Jersey does, and they know where their money comes from.

Big US gambling houses pay politicians to protect their business model, it seems.

It is illegal to gamble in the physical world in most of the US (with some very conspicuous exceptions - horse racing, Indian tribe-run casinos and state-run lotteries).

Also, in a lot of costal cities, you can get on a scheduled floating casino, sail 7 miles out to sea, and start gambling.

That is surprising to me. I bet you couldn't park a boat 7.1 miles out to sea and sell heroin by the tonne!

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