PokerStars, the biggest online poker website in the world recently announced that it has decided to shutdown operations in Israel and has sent out an email to Israeli poker players informing them that the company had decided to pull out.
PokerStars was founded in 2001 by the Israeli Scheinberg family who helped turn the poker site into one of the most popular online gambling brands in the world. PokerStars is now being run by Canadian based Amaya Inc who acquired the brand back in 2014. Amaya Inc now joins the likes of 888poker, Unitbet Poker and partypoker who have already pulled out of the Israeli market.
The company informed players that it will be converting their tournament tickets into real money for all Israeli online poker players and players will also have the option to convert their remaining StarsCoin balances into real cash and then withdraw their funds. PokerStars decided to pull out of Israel as the company decided it was far too risky to continue to offer online gambling services in Middle Eastern markets due to a number of business risks that existed.
An email from PokerStars read “Our management team regularly reviews our operations market-by-market to assess commercial opportunities and business risks for our brands. Following a recent review, we regret to inform you that we have decided to stop offering real money games to players who are physically located in, or have a registered address in, Israel [as of] June 27, 2016.”
Israel had banned all forms of gambling based on a law passed in 1977 but most of the government’s in power did not pay strict attention to the online gambling industry and as a result there were a number of online gambling providers who took the risk and provided services to Israelis. However the State Prosecutor began to take special interest in online gambling providers in 2015 and was deliberating over taking a major credit card provider to court for providing payment services to off-shore online gambling providers.
Earlier this year the Jerusalem District Court also cracked down on the online gambling industry after ruling that Texas hold’em was not a game of skill but a game of chance and hence was illegal as per the country’s law. Last week, the banking regulator in Israel also informed credit institutions that they could no longer process any transactions related to the online gaming industry.
Amaya Inc has decided to move out before it gets into any trouble as a bad actor label would hurt PokerStars chances of expanding into the United States as a number of states are currently looking at legalizing the online poker industry.