U.S. online gamblers find refuge in Costa Rica
When the United States Department of Justice clamped down on online poker websites on April 15, freezing players’ assets and shutting down play in the U.S., Kristin Wilson saw an opportunity.
“When Black Friday happened it was really intense because essentially all of my friends were fired overnight,” said the 29-year-old entrepreneur, who had been working in real estate in the southwestern San José suburb of Escazú. “I just immediately saw the opportunity. Within hours I thought, ‘I can help these people.’”
Wilson, a former professional surfer, knew people involved in the online poker industry in Costa Rica, where online play is legal. When she checked her Facebook page after Black Friday, as April 15 is known in poker circles, she saw that professional players in the U.S. were musing about relocating to Costa Rica to play while the indictments wended their way through U.S. courts.
“I’ve been travelling by myself since I was 15,” Wilson said. “You accumulate a lot of knowledge about how to relocate and how to adapt to different countries. So, I actually started emailing people on Facebook, really well known poker players and saying, ‘Hey if you guys want to come down here, let me know and I can help you.’ Then, I started getting referrals and requests and emails from people, … and that’s how it started.”
She partnered with friends who owned the poker website Pocket Fives, and Poker Refugees – a relocation service geared toward online poker players – was born.
“Their users were asking for this kind of service,” Wilson said. “And I was trying to provide this service, so we joined forces, and, voilà! We made something out of nothing.”
Wilson doesn’t just settle displaced poker players in Costa Rica, though she says it is the most popular location she services. She’s placed players in Panama and Canada, and Argentina, Chile and Thailand are countries she’s looking at as possible sites. The location, she says, depends on the specific needs of each client.
“I try to figure out what they need, and then try to identify what would be the best place for them to go,” she said.
Canada, for example, frowns on online poker players relocating there permanently to play, so she might help someone set up for just a few months. Costa Rica offers a more poker-friendly environment, so more of her clients look at it as a long-term possibility. She helps them find a place to live, get an Internet connection and arrange any other things they need to settle in and start playing. That can include moving a dog, arranging travel for a girlfriend or family, or organizing documents proving that they are not playing from a location in the U.S.
“Costa Rica, especially, and Panama are countries where you can’t just Google stuff [to relocate],” Wilson said. “You have to know how to navigate the obstacle course of Costa Rica, and that’s not as simple as it sounds.”
Wilson, who holds a master’s degree in business administration from the University of Central Florida, charges a flat fee of $1,000 for her services (Pocket Fives, which helped her launch her website, gets a cut of that). She says she has fully relocated about 20 clients. She has helped others set up an Internet connection or connect with lawyers and accountants. In Costa Rica, she says, she has placed “about half and half” of her clients around the Central Valley or in beach towns.
“The thing is they kind of stay home a lot,” she said of her Poker Refugee clients. “They just want to be in a nice place somewhere.”
She doesn’t cater exclusively to poker players.
“I have clients that are consultants online or teach English online or work as freelance writers,” Wilson said. “You can do anything online, almost.”
Kane Kalas, 22, and Alex McElroy, 23, are two of Wilson’s clients. High-tech international nomads, the two landed in Costa Rica in late September as a result of the U.S. government shutting down their livelihoods. After being in Costa Rica just a week, Wilson has them set up in an Escazú condominium while they ink a deal to rent a five-bedroom house in Santa Ana. They are working to set up Costa Rican bank accounts proving they are not playing from a U.S. location and allowing them to get back to playing online poker.
They play between seven and 10 hours of poker daily. They use software to track thousands of hands they’ve played in order to recognize long-term patterns in their opponents’ play. Both say they expect to earn between $140,000 and $300,000 this year, once they start playing again.
“I just wanted to get set up somewhere and play legitimately,” Kalas said when asked about Costa Rica as a choice of locations.
“You just hear about things like [Poker Refugees] when you’re in the poker community,” he said.
McElroy tried his hand at live poker in Las Vegas after the U.S. online poker industry was frozen, but he found the play too slow.
“Once you get adapted to online play, it’s hard to play at that slow of a pace,” he said.
He left Las Vegas and made an attempt to relocate to Canada but ran into trouble.
“We were honest [about being professional poker players] at the Canadian border,” he said. “And they wouldn’t let us in.”
Kalas and McElroy both have “tens of thousands” of dollars in limbo with Full Tilt Poker, a major poker website recently derided as a Ponzi scheme by U.S. Attorney Preet Bharara The U.S. Justice Department has filed both civil and criminal charges against Full Tilt Poker alleging that, “Full Tilt Poker not only engaged in the operation of an unlawful gambling business, bank fraud, wire fraud, and money laundering, … but also defrauded its poker players by misrepresenting to players that funds deposited into their online player accounts were secure and segregated from operating funds.”
Kalas and McElroy doubt they’ll see any of their money held by Full Tilt Poker come back to them.
Kalas said he might sell his Full Tilt holdings for 25 cents on the dollar, because he thinks there’s about a 75 percent chance he’ll never get it back.
McElroy suggested 30 cents on the dollar.
In the meantime, though, they’re working on getting ready to play again and thinking about the future.
“I play for the lifestyle,” said Kalas. “Choosing your own hours, having that kind of freedom. We can live anywhere in the world as long as we have an Internet connection.”
McElroy says it’s about passion and being able to work for himself.
Wilson says she’s learning to play live poker but hasn’t taken up online play. Her service, she says, is more than just a resettlement service – many of her clients have lost a lot of money and the ability (in the U.S. at least) to make more.
“Imagine having your life savings disappear overnight,” she said. “A lot of my clients had their whole savings in poker sites. With the players, I know they need to leave, and I know that I can help them. What we do is offer what the players want. I like what I do.”
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