Online
Poker Tourney Winners Reap Benefits of Low Profile
One of the world's largest
poker tournaments has just concluded, awarding
nearly $13 million in prize money to 1,972 people.
Yet the winners of these events may
never be known to the public.
The World Championship of Online Poker, an
event hosted by the Costa Rica-based Internet
site PokerStars.com, is by far the world's largest
online poker tournament. The top prize in the
final event, a game of no-limit hold 'em with
a $2,500 buy-in, was $577,342 and went to Pennsylvania
player "Panella86." Second and third,
"Vendetta" and "tralala"
are from Sweden and won $573,735 and $540,877,
respectively.
These aren't real names, of course, but screen
names chosen by players to disguise their identities.
In fourth place, Las Vegan "PICKLED EGG"
won $242,775. "Buster Love, also from Las
Vegas, won $56,025 for ninth place.
A spokesman for PokerStars.com declined to
reveal the winners' real names, citing confidentiality
agreements with players.
While poker tournament winners in casinos become
celebrities and receive extensive press coverage,
Internet gambling tournaments are still a relatively
underground event.
Nevada law makes Internet gambling illegal,
and the Department of Justice says federal law
makes it illegal nationwide. But attorneys say
that's not the main reason why players wish
to remain anonymous.
By keeping their names out of the public eye,
players can try to avoid paying federal taxes
on gambling winnings, they say. Unlike land-based
casinos in the United States, offshore Internet
gambling companies aren't obligated to provide
tax forms to people who win large jackpots.
Americans who win money in other countries
still must declare gambling winnings as part
of their gross income, said Steve Johnson, a
tax expert and the Wiegand Professor of law
at UNLV's Boyd School of Law.
"If the individual chooses not to report
on the return the government doesn't often find
out about it," Johnson said. "But
if the government finds out any time in the
person's lifetime then the whole sky falls down
on this guy.
"It's a matter of assessing the risk factor,"
he said. "I would think people gambling
online aren't the most risk averse."
The IRS has ways of finding out people who
don't report winnings. The government offers
rewards for informants and could also end up
auditing someone's return for other reasons
and finding out a person is living well above
their income level, Johnson said.
There's also bragging rights to consider.
"You don't feel superior until you tell
others about it," Johnson said.
Joseph Kelly, an Internet gambling expert and
law professor at State University of New York
College at Buffalo, said players have little
to worry about apart from the IRS.
Only a few states have laws that prohibit Internet
gambling and even then, some only finger the
operator and not the player, Kelly said. Even
the Department of Justice, which has threatened
online casinos with prosecution, has said that
casual bettors aren't violating the law when
they gamble online, he said.
Only one state, North Dakota, has actually
prosecuted a player for gambling online, Kelly
said.
But that won't get the IRS off a player's back.
"You're playing with fire when you don't
declare that you've won and you win a huge amount
of money," Kelly said.
Single individuals who earn more than $326,000
are subject to the top tax rate of 35 percent.
The 15-day PokerStars.com tournament, which
featured one poker game per day, attracted 19,727
players representing 82 countries -- making
the event the most geographically diverse tournament
around.
After nearly 14 hours of play, the finalists
of the final hold 'em event agreed to split
the pot between them so they each would receive
more than $500,000, organizers said.
Many of the players won their entry fees into
the tournament events through satellite tournaments
online that cost as little as $5.50, they said.
Other players earned free seats into satellites
using "player points" accumulated
by gambling at PokerStars.com. The site awarded
more than $1 million in entries to players,
organizers said.
Contestants included PokerStars.com pitchmen
Chris Moneymaker and Greg Raymer. Moneymaker
and Raymer were the 2003 and 2004 winners, respectively,
of the World Series of Poker casino tournament
in Las Vegas.
Some disguises were catchier than others. The
No. 5 winner was simply listed as "aaaaaaaa"
and No. 15 was "1011000." But No.
16 was "dirkdiggler9" after the name
of the porn star in the film Boogie Nights,
No. 37 was "SLY STONE" after the soul
band leader and No. 47, "G. COSTANZA,"
is a likely reference to George Costanza, a
lead character on the sitcom "Seinfeld."
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