Daniel Tzvetkoff (pictured left), the one-time high-flying Queensland Internet whiz who brought down the online poker industry in the US, is due to emerge from FBI protection next month.
The 29-year-old faced a sentence of 75 years in a US Federal Prison but in 2010, while languishing in a New York jail, Tzvetkoff struck a secret deal with prosecutors and has become a star informant for the US Government in its bid to prosecute the kingpins of three of the world’s largest online gambling companies: PokerStars, Full Tilt Poker and UB/Absolute Poker.
Tzvetkoff, whose Queensland-based company Intabill allegedly processed more than USD $1 billion (AUD $957 million) of illegal transactions between US gamblers and Internet gaming websites based offshore, has handed more than 90,000 documents over to prosecutors. The inside information includes confidential emails.
Tzvetkoff’s first public test as a prosecution witness will come on April 9 in a New York courtroom when a former Las Vegas-based business partner, Chad Elie, and a Utah banker, John Campos, go on trial.
Elie, 31, is charged with nine offences including conspiring to commit bank fraud and money laundering and, if convicted, faces a maximum jail sentence of 85 years.
Campos, a 57-year-old executive at Utah’s SunFirst Bank who allegedly agreed to process gambling transactions, is charged with six offences and could be jailed for 35 years.
This week, Elie’s lawyers complained to the judge handling the case that, on the eve of the trial, prosecutors dumped a “mountain of documents” on them, including Tzvetkoff’s emails.
“For example, although the government had previously produced emails for Daniel Tzvetkoff, one of the government’s main witnesses in this case, the material we recently received revealed that Mr Tzvetkoff had deleted his emails from the Intabill server, which had previously been made available to the defence, and that the Tzvetkoff emails that were included in prior productions were therefore ones that Mr Tzvetkoff had cherry-picked for the government,” Elie’s lawyers, Barry Berke and Dani James, stated.
“Only after we pointed this out to the government did we receive a full set of Mr Tzvetkoff’s materials, which included more than 90,000 documents and which we were able to access for the first time only yesterday.”
Tzvetkoff was once a media darling in Australia, flaunting his wealth – estimated at AUD $82 million just a few years ago – with a AUD $27 million home on the Gold Coast, a garage filled with Lamborghinis and Ferraris, and as a sponsor of V8 Supercar outfit, Team IntaRacing.
His world came crashing down in 2009 when the Internet poker companies, for which he allegedly helped launder USD $1 billion, accused him of stealing about USD $100 million.
Tzvetkoff was arrested at a Las Vegas casino in April 2010 and charged with money laundering, bank fraud and other charges.
US Federal prosecutors vigorously fought to keep Tzvetkoff in jail after his arrest, including successfully overturning a Las Vegas judge’s decision to grant Tzvetkoff bail.
Tzvetkoff was transferred to a New York jail and sat there until June 2010 but, after secret dealings sealed by judges, he disappeared.
“He’s turned the corner, seen the light and is cooperating,” former FBI agent Harold Copus, after reviewing the details of the case, told PMA.
On April 15 last year, Tzvetkoff’s inside knowledge led to “Black Friday”, the day tens of thousands of US poker players logged on to their computers and discovered three top gambling sites – PokerStars, Full Tilt Poker and UB/Absolute Poker – had been shut down in the US by authorities.
The FBI and prosecutors also announced that day Internet gambling kingpins Isai Scheinberg and Paul Tate of PokerStars, Raymond Bitar and Nelson Burtnick of Full Tilt Poker, and Scott Tom and Brent Beckley of Absolute Poker, were charged with bank fraud, money laundering and illegal gambling offences.
Elie and Campos were also charged in the sweep. Prosecutors alleged Elie, as Tzvetkoff’s Intabill was crumbling in 2009, fleeced $US4 million from PokerStars.
“Intabill’s founder, Daniel Tzvetkoff, who processed over USD $1 billion for the poker companies, ended up owing tens of millions to PokerStars,” prosecutor Arlo Devlin-Brown wrote in a recent court filing.
“While Tzvetkoff’s lifestyle is squarely responsible for much of the missing money (USD $25 million on a house, for example), the fact is that ‘sub-processors’ that Tzvetkoff relied on – including Elie – also failed to remit and indeed simply made off with the money PokerStars was missing."
• Additional reporting by AAP