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More Poker Black Friday Fallouts
Courts refuse to block takeover of credit union implicated in online poker indictments
The federal indictments against online poker activity in the United States claimed another victim this week when the US government's National Credit Union Administration imposed a conservatorship on Vensure FCU, a $4.7 million credit union allegedly linked with the online poker sites.
U.S. Judge Rosemary Collyer refused to grant Vensure a temporary restraining order in a Washington court, citing federal law, which gives the NCUA extraordinary powers to take over and liquidate federally insured credit unions.
NCUA has never lost a court challenge to its conservatorship powers.
Mesa, Arizona-based Vensure's legal team argued that the NCUA takeover threatens the existence of the credit union and of its chief corporate sponsor, Vensure Employment Services.
Evidence was led that only hours after the indictments were unsealed by federal enforcement authorities in New York, the NCUA imposed its authority over Vensure, freezing an account that allegedly processed $25 million a day in automated clearinghouse transactions for the two biggest online poker websites, PokerStars.com and Full Tilt Poker.
Vensure lawyers told the judge that their client has made moves to terminate its relationship with the poker sites and is capable of surviving without those revenues, which made up the vast majority of its business last year.
They expressed concerns that the NCUA would liquidate the company whilst its CEO and four employees were on NCUA-enforced leave with full benefits.
Media reports on the case claim that the NCUA knew all along of Vensure's gambling connections and core business, warning the company in January this year to cease and desist its gambling
ties, which the Vensure board voted to do later that month. At that point it is claimed that Vensure notified the online poker sites of its intention to terminate its processing agreement within 180 days.
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