It contends U.S. crackdowns against foreign betting sites are illegal and protectionist, since gambling for money is permitted in U.S. casinos and since online betting is allowed for state-regulated horse racing in the United States.

More details about the Antigua claim at Reuters.

“We are aware of the indictment only through what has been announced publicly,” Bristol, Connecticut-based ESPN said yesterday in an e-mailed statement. “For the immediate future, we are making efforts to remove related advertising and programming pending further review.”

On Friday, 11 people, including the founders of the three largest online poker companies doing business in the U.S.—PokerStars, Full Tilt Poker and Absolute Poker—were charged with offenses including bank fraud, money laundering and online-gambling offenses.

Yesterday, Bradley Franzen, one of 11 people charged last week with being part of an online gambling conspiracy, pleaded not guilty before a U.S. magistrate in New York.

Franzen, 41, of Illinois and Costa Rica, is accused of lying to banks about the nature of the transactions they were processing, and of creating fake companies and websites to disguise payments to poker companies.

Federal prosecutors in Manhattan have alleged the poker companies, which are located outside the U.S., tried to sidestep U.S. laws prohibiting banks and credit card issuers from processing gambling payments by disguising billions of dollars from U.S. gamblers as payments to nonexistent online merchants for golf balls, jewelry, flowers and other merchandise.

This crackdown is far stronger than any seen from the Bush administration, and is disappointing for those who had hoped for a better stance on civil liberties from the Obama administration. The Poker Players Alliance issued the following statement after the busts

On behalf of the millions of poker players across the country, we are shocked at the action taken by the U.S. Department of Justice today against online poker companies and will continue to fight for Americans’ right to participate in the game they enjoy. Online poker is not a crime and should not be treated as such. We are currently gathering all of the information around today’s announcement and will offer detailed analysis when the full facts become available.

Source: PPA

New York prosecutors say they’ve issued restraining orders against more than 75 bank accounts in 14 countries used by the poker companies, which they say will interrupt the illegal flow of billions of dollars, according to The Associated Press.

Eleven individuals were charged over their involvement running PokerStars, Full Tilt Poker and Absolute Poker for violating the 2006 Unlawful  Internet Gambling Enforcement Act.

The Justice Department has filed a civil complaint for money laundering that seeks $3 billion being held by the companies.

According to a federal indictment, the owners of the companies sought ways to get around restrictions placed on U.S. banks that prohibited them from handling financial transactions connected to online gambling.

“Some of the defendants found banks willing to flout the law for a fee,” Janice Fedarcyk, the assistant director in charge of the FBI’s New York Field Office, said in a prepared statement. “The defendants bet the house that they could continue their scheme, and they lost.”

Federal prosecutors and FBI agents also have obtained a district court order to block 76 bank accounts and five Internet domain names associated with the poker websites.

“This is a potentially game-changing moment for the online poker industry, as PokerStars and Full Tilt are, by quite some distance, the two largest operators not just in the U.S., but globally,” James Kilsby, Americas editor with the business intelligence service GamblingCompliance, told ABC News.

“Previous DOJ enforcement efforts have honed in on sports betting operators and payment companies,” Kilsby said. “Meanwhile, some of the poker operators themselves have claimed that U.S. gambling laws do not apply to poker. It seems clear from today’s action that the Justice Department doesn’t agree.”

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Genevieve Breton, Minister of Justice Rob Nicholson’s director of communications, confirmed that following recent concerns surrounding Internet gambling, the Minister of Justice has directed his officials to investigate whether other measures could assist with the enforcement of the Criminal Code against the reserve in Quebec and other illegal online gambling operations.

According to the National Post, those other measures are understood to be moves to restrict banks and credit card companies from allowing online gambling transactions, similar to what the United States passed with the Unlawful Internet Gambling Enforcement Act. It’s surprising to hear that banning internet sports wagering and gaming, by forcing the banks to rejects payment transactions as United States has done is being considered in Canada as well. There are many examples in EU and England where internet gaming has been legalized, allowing the government to reap tremendous tax revenues while regulating and policing the industry instead of driving it under ground. Furthermore, American Bankers Association Spoke Up Against the UIGEA because of how hard it is to enforce its guidelines and stay with in the regulations.

Michael Lipton, a Toronto lawyer who specializes in gaming law, said in the National Post article that he believes the government should bring the Kahnawake sites into the system and regulate them. It would provide better protection for customers as well as bringing in tax revenue.

“I think [Ottawa] should embrace this and recognize that people don’t want to be in a position where the government tells them what they can or can’t do in the peace of their own home,” Lipton said in the article.

Understanding that people will find a way to gamble and play games online governments should legalize, monitor and tax internet gaming instead of driving the players and casinos underground where players can will get taken advantage off because they can’t complain to the authorities if they are taking advantage of.