Missouri man the latest to be charged under UIGEA

25 May 2010
A 51-year-old Missouri man has been charged with participating in the conduct of a gambling business and conspiracy to launder the proceeds of a gambling business by the U.S. District Court of Maryland.
Kenneth Wienski of O'Fallon, Mo., was charged under the Unlawful Internet Gambling Enforcement Act (UIGEA) for transferring money to and from Internet gambling operators to fund player accounts. He was also charged under Maryland criminal code, which states that a person may not "receive, become the depository of, record, register, or forward, or propose, agree, or pretend to forward, money or any other thing or consideration of value, to be bet wagered or gambled on the result of a race, contest or contingency."
A criminal complaint filed by Detective Richard Gunn of the Anne Arundel County Police Department details the relationship payment processors play in the business model of Internet gambling operators who choose to accept bets from U.S. players.
"In order to facilitate the movement of funds to and from their customers, Internet gambling operators began using money processing businesses generally called 'payment processors,'" the criminal complaint reads. "Typically, an Internet gaming operator directs the payment processor to collect funds from individual gamblers, funds intended to be used to wager with the gambling organization. The payment processor then notifies the gambling organization when the funds are available."
The complaint details how undercover agents gambled at Bodog, making several wagers on sporting events while in Maryland. On several occasions, the agent collected winnings in the form of a check payout. Those checks came from payment processors based in the United States, including Direct Channel, JBL Services, ZipPayments, Electracash, HMD Inc., SNR and Diversified Check Solutions. Warrants were issued to JBL Services in January 2008, and $14 million was seized. Other similar shutdowns and seizures followed with ZipPayments (July 2008, $9.8 million), Electracash (July 2009, $2 million), and HMD Inc. (August 2009, $1.7 million).
According to the criminal complaint, confidential informants say that Wienski, the executive officer of Diversified Check Solutions, "openly discussed that Diversified would be processing gambling funds, and that there was a need for a fake medical billing company to cover these activities."
According to the complaint, Wienski created SNR Medical Billing, Inc. to fill that need. The company's Web site lists more than 50 clients, but one of the listed clients (Lifespan, based in Rhode Island) says it does not do business with SNR. Calls to several other clients were not returned by Tuesday afternoon.
The complaint alleges that Wienski received $135,000 for setting up the scheme from James Davitt, who ran HMD before its funds were seized last year.
The warrant for Wienski's arrest is the latest in a series of legal actions targeting Internet gambling payment processors in the last year. Douglas Rennick of Canada recently entered a guilty plea for money laundering in federal court in New York, forfeiting $17.1 million and facing a sentence of six to 12 months in prison, while Daniel Tzvetkoff of Australia was arrested last month on similar charges.

Aaron Todd

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Home-game hotshot Aaron Todd was an editor/writer at Casino City for nearly eight years, and is currently the Assistant Director of Athletics for Communications and Marketing at St. Lawrence University, his alma mater. While he is happy to play Texas Hold'em, he'd rather mix it up and play Omaha Hi/Lo, Razz, Deuce-to-Seven Triple Draw, and Badugi.