Guy Smith, a poker pro from Shelton, Connecticut, pled guilty to one count of tax evasion this month.
But what a count.
Between 2012 and 2016, Smith managed to keep $482,000 of income from his interior design business secret. And that was small potatoes compared to the “more than $1 million in gambling winnings” he avoided declaring. Obviously, he wasn’t able to keep the secret forever. Smith was warned multiple times by the IRS that he needed to declare his gambling winnings. But chose to ignore them, according to Joleen Simpson, an Acting Special Agent in Charge for the IRS’s Criminal Investigation department in New England.
Simpson announced that Smith was waiving his right to be indicted and he was opting to plead guilty. The brief court hearing took place via video conference with U.S. Magistrate Judge Robert A. Richardson presiding.
The taxman cometh
What is impressive, if not totally admirable, is that Smith managed to keep the enormous sums hidden from his accountant and “tax preparer.” He didn’t even give the poor bean counter his bank statements.
According to the IRS press release on the case, Smith runs a business called Centerline Interiors LLC. Smith “withdrew funds from both his business and personal bank accounts for his gambling business.”
The Guy Smith from CT, listed on the Hendon Mob, has $236,580 in live tourney winnings. His biggest score was $51,149 from the $1,100 NLH Championship at the Summer Kickoff, Mashantucket in 2016. And he has scores from as far afield as the Bahamas.
In total Smith dodged $821,415 worth of Federal taxes. As well as paying that back he will also have to fork out $50,000 for bail. Further investigation and sentencing will decide if there are any additional fines on top of that. Or jail time.
Sentencing will take place on March 4th, 2021.
Death and taxes
The IRS did for Al Capone what Elliot Ness couldn’t. They put him in Alcatraz for a seven-stretch and didn’t let him out ’til neurosyphilis had taken most of his wits.
In the move to regulate gambling, taxes are always one of the first things assessed. Be it cockfighting in the Philippines or lotteries in London, the key to working with Johnny Law is knowing how much to render unto Caesar.
Jonathan Duhamel has had to fight this fight with the Canadian Revenue Agency. In the process, he had to argue that poker was a game of pure luck.
German pros have had to file as small business owners. Though this may change under new regulations. Only a few places, like the U.K., let players off the hook, placing the tax burden entirely on the house.
Whenever a case like this breaks though, it always puts an ugly pressure on the poker community. Poker’s fought long and hard to put its seedy extra-legal past behind it.
Guys like Guy Smith set the game back each time.
Featured image source: Flickr