Unites States v. Pokerstars, et al

Filing 227

DECLARATION of AUSA Jason H. Cowley in Support re: 225 MOTION to (1) Conduct Expedited Discovery Relating to Fugitive Disentitlement and (2) Stay Consideration of the Pokerstars Claimants' Motion to Dismiss the Verified First Amended Complaint. MOTION to (1) Conduct Expedited Discovery Relating to Fugitive Disentitlement and (2) Stay Consideration of the Pokerstars Claimants' Motion to Dismiss the Verified First Amended Complaint.. Document filed by United States Of America. (Attachments: # 1 Exhibit A, # 2 Exhibit B, # 3 Exhibit C, # 4 Exhibit D)(Cowley, Jason)

Exhibit C

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The Scheinberg Family and Poker Stars
Isai Scheinberg and Family
Isai Scheinberg (pictured to the right) founded Poker Stars on March 11,
2001. Isai and his two brothers continue to operate the now highest grossing
online poker site with an estimated $800 million annual revenues (2009).
See here for more on the history of Pokerstars.com.
The Israeli family currently live and work out of the Isle of Man as multibillionaires with 75% stake ownership in the company. The rest is said to
have been given to the employees of Pokerstars. The value of the poker site
was $2 billion in 2006.
A large majority of the remaining 25% is said to have gone to Lee Jones
who used to be the face of pokerstars as the “Cardroom Manager”. Dan
Goldman is the VP of Marketing and has been for many years and would
surely own a large chunk as well. Other possible names that come up as having a percentage are Tom McEvoy
(1983 WSOP Champ) and John Harkness (Investor and friend of Isai).
Isai Scheinberg founded Poker Stars while living in Richmond Hills Ontario, Canada. Pokerstars originated in the
Costa Rican jurisdiction.
As did his rival, Anurag Dikshit, a Party Poker founder, Isai also came from a background in programming and
computers. He originated as an IBM programmer for the US based company, and ironically is now wanted by the
Department of Justice of the United States of America for what they believe to be “illegal internet gambling”. Isai,
with the advice from his lawyers believe they are operating in compliance with the law, but due to fear of
prosecution, will likely never set foot on American soil again. Mr. Scheinberg runs the poker site under the
company name Rational Entertainment Enterprises Ltd using their own proprietary software.
Isai is not much of a poker player, only having two cashes in live noted poker events. His first cash was for a
mere $3,337 at a World Series of Poker Event in 1997, 4 years before starting Poker Stars. More recently he
placed 8th at the EPT Monte Carlo in 2008 for a prize of $14,491. While most every online poker player knows
the brand, Poker Stars, Isai can set foot in just about any major poker event and go unnoticed.
Schienberg and family announced they were going to offer an IPO in 2006. This did not happen and was
probably one of the smartest moves by Mr. Schienberg. At this time in 2006 the website was set to bring the
family $2,000,000,000. It grew to over four times that size in just a little over 3 years. In 2006 its peak player
volume of real money players was approximately 9,900 and in the late quarter of 2009 it neared an average of
38,970. Poker Stars approximate value is now set at more than $10 billion.
The dramatic increase in size was due in fully majority of the a United States law (UIGEA) which made it illegal
for banks to transfer funds to and from gambling sites. Pokerstars continues to operate in the US market with little
interruption as a privately held company.
An employee of Poker Stars said the Sheinberg family are extremely friendly people and continue to work at the
Isle of Man location despite their enormous accumulated wealth.
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