By Nathan Carroll, Rakeback.com Staff Writer
Poker player and ex-Full Tilt Poker employee Jason Newitt has been served with a subpoena from the office of the U.S. Attorney for the Southern District of New York (SDNY). He is ordered to appear before a grand jury on September 14th to give testimony regarding Full Tilt Poker (FTP) for an ongoing federal investigation.
This is not the first time we've heard from the SDNY. In June 2009, they orchestrated one of the biggest crackdowns on internet gambling this country has ever seen. Targeting bank accounts managed by Allied Systems, Inc. and Account Services, authorities froze or seized $34 million in funds. These two payment processors deal with the majority online poker cash outs, and all of the big U.S. networks were affected: PokerStars, FTP, Cake Poker, and Cereus, among others.
In all cases, the online operators decided to eat the loss rather than short their customers and compromise their reputation for secure and safe accounts. So even though players were eventually returned all their funds, the incident set off a flurry of debate. Doomsayers warned that this move signaled the end of online poker in the U.S., while others brushed off the implications and suggested that everyone return to business as usual. And aside from an increase in intensity from the Poker Player's Alliance and other advocates for the game, that's more or less what happened. That is, the federal attorneys in New York have stayed quiet--until now.
This is also not the first time the poker world has heard from Jason Newitt. His name turns up in an amusing 2007 incident that achieved meme-worthy status on a notable poker message board.
In November of that year, Jimmy "Gobboboy" Fricke issued an email request for sponsorship to FTP and got back a simple rejection note--but with some of the internal debate still attached. The undeleted email thread revealed Howard Lederer referring to Gobbo as "a freak, and a very weird dude." Lederer further explained, "he is also quite young. I think we should stay away."
Fortunately, Fricke took the accidental insult in good humor, and the story spread throughout the online poker community. Where does Newitt come in? Well, it turns out that he was the customer service rep corresponding with Fricke--and presumably the one who screwed the pooch during the email exchange. Oops!
The next development in Newitt's saga came in 2009 when he hit Full Tilt with a lawsuit, claiming wrongful termination and unsettled distribution payments. Was he fired in the fallout from the Gobboboy incident? No one knows for sure, though if that turns out to be true it's pretty gutsy for him to claim he didn't deserve to lose his job over it. Whatever the reason, Newitt was willing to file a case through the Nevada court system.
His own case and the ongoing investigation by federal authorities combine to put Newitt in a bind. The reference to "distribution payments" in the lawsuit filings implies he has an ownership stake in FTP. According to the SDNY, that makes him the operator of an "illegal gambling business" and might put him back in court as a defendant instead of a witness. It's possible that the attorneys will offer him a deal whereby he receives amnesty for his role in FTP in return for explaining what he knows about the power structure of the business.
Regardless of what happens, hopefully the phrase "freak and a very weird dude" is used in court as much as possible.
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