What Is Underground Poker
Underground poker is an unsanctioned poker game. It does not mean the game must be underground. An underground poker game can be played in private homes, apartments, warehouses, and yes...building basements. The underground element was mostly referring to the the private nature of the game. Gambling was largely unlawful throughout the United States (and in most parts still is to this day), so players had to find alternate places to play. Shady entrepreneurs saw this as a way to make a little money, so the underground game was born. A game that was not known to the public, but rather spread by word of mouth. You usually had to know someone who already played there for you to even know about it.
Legality Or Lack There Of
Depending on the jurisdiction, an unlicensed or unsanctioned game was not necessarily illegal. Some states, such as Texas, allow home/private poker games without any legal retribution as long as the house does not rake the game. If in any way shape or form the house develops an advantage (i.e. rake or hosting a game where the odds are in the house's favor) the game would then be considered illegal.
Another interesting tidbit lies in the state of New York's law. It is apparently illegal to host a gambling game of any kind, whether that be a casino or simple poker game. However, on the flip end, gambling itself was not illegal. So most players in underground games were not breaking the law by playing in them. The only people breaking the law according to the state of NY, were the staff.
History
One of the oldest 'underground' clubs in NYC (since has been shut down) was the Mayfair. The Mayfair started out as a bridge and backgammon club (circa 1940), about 20 years later as the popularity of poker grew, the club stopped hosting their regular games and switched to poker. The Mayfair gained immense popularity in the late 80s when professional poker players such as Erik Seidel and Howard Lederer became regulars.
Clubs such as the Mayfair weren't the only games in town. In fact, most gaming clubs were simply a place where men could come mingle and throw back a cocktail or two. That slowly changed with the influx of Eastern European immigrants coming into the United States, mainly NYC. Eastern European men loved playing cards for money while chowing down on some authentic, grandmother made foods. As a results, local Ghoulash joints became the place for poker action. The card playing god, Stu Unger got his start in places such as this, as his family owned a Ghoulash restaurant which eventually became a haven for high stakes poker players.
Sadly, most NYC clubs shared the same fate as the above two, when the love of poker turned into a love for money. The friendly atmosphere vanished and was replaced with hardcore gamblers, and crooked host.
Not What You See In The Movies
I am not sure about you, but after seeing countless movies on high stakes casino games, the mental image I had of games such as this was far different than reality. The movies made these underground games out to be an affluent affair with vodka martinis and gorgeous ladies in beautiful gowns. Even the staff they showed was decked out in tuxedos, and treated the players like royalty.
The reality of an underground poker game was something quite different. Whether it be a low stakes game in a shit hole part of town, or a high stakes game in fancy Manhattan, the underground game was nothing to be envied. Most places were located down dark alley ways with shady characters strewed about. A password of some sort was usually needed to gain access through the door. Once you enter, it was usually just your average room with a few scattered poker tables. There was no bar, no chandeliers, and no drop dead vixen strolling about. No instead, you were hardly greeted at all, you were frisked for weapons, and then lead to a dark, musty corner to play a game that you cannot win.
It wasn't some different kind of poker being played, it was simply a rigged game. Collusion was rampant among the tables and the house did not give a rats ass. You want to know why...because the house was in on it. The house would not only hire proposition players to sit in on the games and play with house money, they were given select seats at the table to ensure maximum action. You read that correctly, usually the house player was given the seat next to the dealer and instructed to raise every hand no matter what. The big action led way to big rakes; and that is all that mattered to the host. Most places did not even provide free drinks or food. Imagine dropping $10K at a game and having to still pay $5 for a sandwich.
Few players came out unscathed from underground poker clubs. Most would lose large sums of money and go back to their mundane lives with their head held down, now only to be further in debt. The house however made out like bandits, easily earning at least, $25K a night from the rake alone. That is most certainly not my idea of playing poker for the love of the game.
The Downfall
The underground games of New York almost fell just as fast as they gained popularity. As the 90's approached and Rudy Giualini came into office, the underground games were being raided by police. Until then they were mostly overlooked by the police. They knew they existed, but sorta just looked the other way. That came to an end when the crime element effected the underground clubs. Robbers would come in armed and demand money from players and casino staff. One such incident found a robber who was jittery with his weapon, accidentally shooting a player dead. Once that occurred the city could no longer look the other way. The police force brought down the hammer with their raids; resulting in club owners and staff getting arrested, and players having thousands of dollars confiscated.
It is believed that the city of New York took in over 15 million dollars in a course of 1 year in confiscated money from players and club owners. In the end, the corruption didn't stop, just shifted.
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Sources
http://observer.com/2015/09/all-in-2/
https://www.thedailybeast.com/illegal-new-york-poker-clubs-a-former-waitress-reveals-what-goes-on-inside
https://en.wikipedia.org/wiki/Underground_poker
https://www.playny.com/poker/