5Dimes Allegedly Using Amazon Gift Certificates to Launder US iGaming Funds

March 18th, 2016 | by Jason Reynolds

5Dimes, a Costa Rican online gambling site and poker room, has been accused of offering unlicensed real money betting options to US residents through an elaborate scheme involving Amazon gift certificates.

5Dimes under investigation for Amazon gc money laundering

Costa Rican iGaming site 5Dimes under investigation for allegedly using Amazon gift certificates to facilitate illegal online poker in the US. (Image: windowscentral.com)

Although many members of the online poker and betting community have long questioned the practices at 5Dimes, the news that it is now under investigation by Department of Homeland Security (DHS) can only make more people run from the illegal offshore site.

The root of the problem and the reason feds filed for a seizure warrant with the U.S. District Court in Philadelphia this week has been to access 15 Amazon accounts worth over $159,000 in total that are linked to 5Dimes.

The use of the cards is the way 5Dimes has allegedly tried to circumnavigate the Unlawful Internet Gambling Enforcement Act (UIGEA) by suggesting use of the gift cards as a payment option, particularly to American players.

A Way Round UIGEA

Since UIGEA came into force back in 2006 it’s been illegal for online poker rooms and betting sites to process funds from US citizens. Although the law didn’t specifically outlaw iGaming, it rendered it impossible for players to play for real money because operators weren’t permitted to process real money transactions.

Since 2006, a number of sites have illicitly remained active in the US and used a variety of methods to skirt around the legal parameters of UIGEA. 5Dimes is reportedly one such company, as it accepted Amazon’s gift cards as an approved deposit method.

So far, one account belonging to GC Lover has been shut down by Amazon, but the DHS has stated that 5Dimes has violated Amazon’s terms of service and that $1.9 million has potentially been laundered through the site.

“The investigation has determined that 5Dimes has developed an alternative to the traditional online financial payment methods, which is unavailable to 5Dimes under federal law,” read the DHS document.

Elaborate Scheme, Predictable Outcome

As outlined by Steven Stradbrooke at CalvinAyre.com, 5Dimes would offer players a 10 percent bonus on any transactions involving Amazon gift cards. The way the system allegedly worked was as follows:

US customers would visit their local store and purchase an Amazon gift card with cash.
They would then submit digital photos of the gift card (showing all the relevant data) and send it to 5Dimes.
The site would then cash in the gift card and credit the player’s account accordingly.

For withdrawals, 5Dimes would either pay players using gift cards or buy the customer an item of their choosing (with a value equal to their withdrawal amount) from Amazon.

At the time of writing, the 5Dimes European website is blocked for certain regions, including the UK (although not in some parts of the US), but its dot.com URL is still live for residents in the UK (but not in certain US regions).

As recently as Tuesday, the company was urging its Twitter followers to register their NCAA brackets for a chance to win $25 million, and was even promoting Bitcoin deposits as an “anonymous” way to fund accounts, along with the always-popular “China Union Pay” method.

It remains to be seen how much longer the site will remain live as the DHS investigation looks set to delve further into the site’s financial practices in the US and that could potentially bring it down in the coming weeks.