Men named in poker indictment already tied to Las Vegas fraud case

Two of the men arrested in today's national Internet poker crackdown are already tied to a massive fraud case being prosecuted by the Federal Trade Commission in Las Vegas.

Las Vegas businessman Chad Elie, who was arrested today, had earlier sued St. George, Utah, businessman Jeremy Johnson, who authorities claim was the mastermind behind a fraudulent $275 million Internet billing scheme. Johnson is the focus of the FTC lawsuit in Las Vegas.

Elie, who has a Las Vegas company called 21Debit, is accused in indictments today of, along with others, approaching John Campos, vice chairman of SunFirst Bank in St. George, Utah., about processing Internet poker transactions.

SunFirst Bank is a creditor of Johnson's in the FTC case.

"While expressing 'trepidations,' Campos allegedly agreed to process gambling transactions in return for a $10 million investment in SunFirst by Elie and an associate, which would give them a more than 30 percent ownership stake in the bank. Campos also requested and received a $20,000 'bonus' for his assistance," said a statement today from the U.S. Attorney's Office in Manhattan. Campos was among those arrested and indicted today.

In his lawsuit against Johnson, Elie claimed he was due $20 million from Johnson and codefendants after Johnson told him he had a trusted relationship with SunFirst and that, in exchange for an investment, Elie could begin processing payments for his "online merchants" through SunFirst. That lawsuit was dropped for undisclosed reasons last month.

The bank, in the meantime, had been hit with an enforcement order from the Federal Deposit Insurance Corp. related to its processing of transactions for Johnson.

Johnson was not named in today's criminal indictments.

However, in court papers he's said he not only played poker extensively on sites operated by some of the defendants in today's indictments -- Full Tilt Poker and PokerStars -- but that his companies had merchant account arrangements with online poker companies including Full Tilt and that he used some of the poker companies' funds for investments.

In today's indictments, Elie, Campos and others are charged with conspiracy to violate the Unlawful Internet Gambling Enforcement Act and other counts. Elie faces a count of conspiracy to commit bank fraud and wire fraud while both he and Campos face a charge of money laundering-conspiracy.

This isn't Elie's first encounter with law enforcement.

Elie said in his Utah lawsuit that besides running his Las Vegas company, he is the CEO of Florida company Viable Marketing Corp.

Records in Florida show Viable Marketing was named in a Feb. 17, 2010, statement from Florida's Attorney General and the FTC as one of several companies that received subpoenas investigating potential violations of Florida’s Deceptive and Unfair Trade Practices Act.

The Viable Marketing subpoena related to "unauthorized recurring charges" associated with a work-at-home Internet business opportunity, the statement said.

An attorney for Elie couldn't immediately be located for comment on today's indictments, which focused on major online poker operators PokerStars, Full Tilt Poker and Absolute Poker.

The main FTC case against Johnson and his companies, filed Dec. 20 in Las Vegas, remains active with the defendants last month updating their denials of allegations of wrongdoing.

The defendants said they had in good faith tried to comply with FTC marketing guidelines -- assertions denied by the FTC.

The FTC says Johnson and his companies scammed consumers out of $275 million by luring them into obtaining trial memberships for bogus services and then repeatedly charging their credit and debit cards monthly fees for the worthless services.

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