MANHATTAN (CN) – The former vice chairman of SunFirst Bank in St. George, Utah was sentenced Wednesday to 3 months in prison and barred forever from the banking business for processing $200 million in illegal online poker transactions, the U.S. Attorney’s Office said.
John Campos, 58, pleaded guilty in March to causing a federally insured bank to accept money in connection with illegal gambling, prosecutors said in a statement.
According to the U.S. attorney’s statement: “After several Internet gambling businesses withdrew from the U.S. market following the passage of the UIGEA [Unlawful Internet Gambling Enforcement Act], Pokerstars, Full Tilt Poker, and Absolute Poker/Ultimate Bet (the ‘Poker Companies’) became the top three Internet poker operators continuing to do business in the United States. Because United States banks were largely unwilling to process payments for an illegal activity such as Internet gambling, the Poker Companies principally relied on one of two tactics to process billions of dollars in payment transactions from U.S. residents who gambled through their websites. First, the Poker Companies and their agents lied to U.S. banks about the nature of the poker transactions they were processing by creating phony corporations and websites to disguise payments to the Poker Companies. Second, the Poker Companies and their agents identified small banks on the brink of failure and offered them millions of dollars in investments in return for the banks’ agreements to process the poker transactions.
“Campos was the Vice-Chairman of the Board of Directors and part owner of SunFirst Bank in St. George, Utah, which was in need of capital. In September 2009, a payment processor serving Pokerstars and Full Tilt Poker proposed to Campos that SunFirst Bank accept an investment of $10 million in return for processing Internet poker transactions. Such an investment would make the payment processor the bank’s single largest owner. SunFirst’s attorney warned Campos that processing payments for an illegal business could lead to prosecution or seizure and forfeiture. Campos chose to ignore this advice, and proceeded to finalize the deal for SunFirst to process poker transactions in return for an investment. SunFirst bank earned approximately $1.6 million in fee income for processing poker transactions until November 2010, when the Federal Deposit Insurance Corporation ordered the bank to cease such processing. In November 2011, bank regulators ordered SunFirst closed due to lack of capital.”
Six other defendants have pleaded guilty; five others, including the founders and directors of payment processing for Full Tilt Poker and Pokerstars, are at large outside the United States, prosecutors said.
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