Archive for September, 2011

Full Tilt Gaming License Revoked

Thursday, September 29th, 2011

In a not altogether surprising piece of news, the Alderney Gambling Control Commission (AGCC) announced today that they are revoking the gaming licences of Full Tilt Poker.

Said AGCC in a statement on the matter, “At a hearing held in London over six days, it emerged that FTP had fundamentally misled AGCC about their operational integrity by continuously reporting as liquid funds balances that had been covertly seized or restrained by US authorities, or that were otherwise not actually available to the operator. Serious breaches of AGCC regulations include false reporting, unauthorised provision of credit, and failure to report material events.”

They continued, “It is important to note that the revocation of FTP’s licences does not, as has been suggested, prevent a reactivation of the business under new ownership and management. Unresolved claims by players against FTP become a matter for the police and civil authorities. Now that FTP’s licences have been revoked, AGCC no longer has jurisdiction over these companies.”

Based on recent proof provided by the U.S. government that Full Tilt has far less money on hand than is owed to players, it is not surprising that AGCC would decide to revoke their gaming license. However, it is nice to bring closure to this aspect of the Full Tilt debacle. One is also left with some reassurance that AGCC truly does have the best interests of players in mind as they claim to and is not little more than a puppet organization in bed with the online poker companies (like the Kahawake Gaming Commission has demonstrated themselves to be by their continued support of UB, Absolute Poker, and even Full Tilt to whom they issue a secondary license).

This news likely makes Full Tilt somewhat less appealing of an investment option since now any buyer must also deal with the process of getting the site re-licensed.

U.S. Politicans Return Full Tilt Contributions

Thursday, September 22nd, 2011

A number of U.S. politicans have come forward stating they will return campaign contributions given to them by Full Tilt Poker.

Pro-poker Massachusetts Congressman Barney Frank had received $18,600 from Full Tilt since 2007. Frank had received another $14,000 from the Poker Players Alliance which was known to be heavily funded by the beleaguered online poker room. The Congressman said he wants to find a way to give the money to those who were defrauded and, failing that, will give the money to charity.

Republicans have not passed up on the opportunity to drag Frank’s name through the mud. Said GOP spokesman Tim Buckley, “It appears Mr. Frank is another congressman willing to associate with criminals.”

According to Jon Ralston via Twitter, a spokesman for Senator Harry Reid commented, “We will be disposing of the contributions associated with Full Tilt Poker as soon as possible.”

The Boston Globe reported that Howard Lederer, Chris Ferguson, and Rafe Furst donated a combined $131,000 to Democratic lawmakers and $42,000 to Republicans since 2007. The Poker Players Alliance received $90,000 from the trio, roughly a third of its funding, in that time.

Epic Poker League Bans Lederer, Ferguson

Wednesday, September 21st, 2011

The Epic Poker League Standards and Conduct Committee today announced the indefinite suspension of league members Chris Ferguson and Howard Lederer pending the outcome of the DOJ’s investigation regarding their roles as directors of Full Tilt Poker.

The suspensions were the result of a committee vote. It is pointed out on the EPL’s site that Lederer’s sister, EPL founder Annie Duke, is “a non-voting member of the committee” and “does not participate in any committee decisions or discussions that involve league member discipline.”

I spoke with most recent EPL champion, Mike McDonald, one of the eight EPL Standards and Conduct Committee members, who explained how the EPL committee reaches its decision: “the committee discusses the issue, everyone voices their opinion, we lay out all alternatives and then vote on what to do with them.” McDonald stated that a simple majority is all that is needed to suspend a player and that just four of the committee members gathered to determine Lederer and Ferguson’s fate. The EPL website states that committee member and Team Full Tilt Pro Andy Bloch recused himself from consideration of the issue.

Suspending Lederer and Ferguson was a smart move by the EPL. Neither man will be participating in an EPL event anytime soon regardless, so nothing really changes on that front, but the EPL does get to maintain its integrity by not granting the men a free pass for their role in Full Tilt’s demise after having strongly enforced their code of conduct against a convicted child molester (Michael DiVita) and a player with significant financial debts to the poker community (Chino Rheem).

Rafe Furst Comments on Full Tilt Allegations

Wednesday, September 21st, 2011

Rafe Furst, an owner and director of Full Tilt, as alleged by the U.S. DOJ, released a statement today on his blog. Here is the entirety of Furst’s statement:

By now you’ve no doubt heard about the allegations against me in a Federal civil suit regarding Full Tilt Poker. Because of the seriousness of the allegations I’m not able to comment at all about the pending case, much as I would like to. From a moral, personal and interpersonal perspective I feel I’ve got nothing to hide. And since I trust in our system of justice and have the utmost respect for my legal counsel, I will refrain from talking about the case until it’s resolved.

What I would like to express here is concern for my family, friends, colleagues and supporters who believe in me and who feel my pain as if it were their own. It sucks to have to endure the character assassination and potshots being taken at me in the media and social networks without being able to defend myself. Privately though I have received incredible support from many of you, and I can’t tell you how much it means to me. May you never have to endure something like this, but if you do, I hope you have friends as good as mine.

To the skeptics, please consider that not everything you read is true, and our society is built on a presumption of innocence until proven otherwise. It’s difficult to take back hurtful things that you might later regret, when the damage has already been done.

To those of you who have asked what you can do to show your support, I am grateful for the offer. My only request at this time would be to not let the naysayers and haters be the only voices out there expressing their opinion of me. My twitter is @rafefurst, and I’d love to hear from you publicly.

With Respect and Love,

Rafe

Rafe does make one fair point here: that he is entitled to the presumption of innocence until proven otherwise. The American justice system is built on that dignity and it should be extended to all Full Tilt defendants until the government can prove their case against them.

However, it does seem at least a little ballsy of Furst to release a statement at this time which, more or less, is aimed at eliciting pity from the masses while offering none to those whose livelihoods have been affected by the poorly-ran company he profited wildly from. Maybe Furst really is totally blameless. But even if that is the case, he would have been wise to include some type of apology or sympathetic remarks to the collection of poker players who have more than $300 million inaccessible due to Full Tilt Poker’s practices.

U.S. Calls Full Tilt Poker a Ponzi Scheme

Tuesday, September 20th, 2011

On a day that many had hoped would yield information regarding Full Tilt Poker’s hearing with their gaming license agency, Alderney Gambling Control Commission (AGCC), the U.S. Department of Justice accused Full Tilt Poker of running a “global Ponzi scheme”.

According to the Wall Street Journal, “The U.S. Attorney in the Southern District of New York filed a motion Tuesday to amend an earlier civil complaint to allege that Mr. Ferguson, Mr. Lederer and two other directors for the website, Full Tilt Poker, operated what the Justice Department says was a Ponzi scheme that allowed the company to pay out $444 million to themselves and other owners, which included other famous poker players.”

Subject: Poker states that the two other directors in question are Rafe Furst and Ray Bitar.

The government alleges in their complaint that the company misrepresented to players that their funds were being held safely when in actuality they were being distributed to owners as profits. “Full Tilt was not a legitimate poker company, but a global Ponzi scheme,” said Preet Bharara, U.S. Attorney for the Southern District, in a statement.

A memorandum summarizing the DOJ’s amendment states that Full Tilt’s Board of Directors, allegedly Ray Bitar, Howard Lederer, Chris Ferguson, and Rafe Furst, paid to themselves and other owners “approximately $443,860,529.89″ from April of 2007 to April of 2011.

In the statement, Mr. Bharara said Full Tilt “cheated and abused its own players to the tune of hundreds of millions of dollars” and that “insiders lined their own pockets with funds picked from the pockets of their most loyal customers while blithely lying to both players and the public alike about the safety and security of the money deposited with the company.”

One way in which this update is significant is that, before today, Howard Lederer and Chris Ferguson were not officially in question by the government. The original Black Friday indictment listed only Ray Bitar and Nelson Burtnick from the Full Tilt camp.

The amended civil complaint states that Howard Lederer received $42 million from the Full Tilt “Ponzi scheme” and that Ferguson, Bitar, and Furst received $85 million, $41 million, and $12 million, respectively. The document states that another 19 owners received the remainder of the $443 million that was distributed including one owner (Phil Ivey?) who received $40 million as well as millions more characterized as loans from Full Tilt. Approximately $4.4 million of these loans remain unpaid.

The complaint also states that, “As of March 31, 2011, Full Tilt Poker owed approximately $390 million to players around the world, including approximately $150 million owed to players in the United States. At that time Full Tilt Poker had only approximately $60 million on deposit in its bank accounts.”

Also featured in the complaint is an email dated June 12th, 2011 from Ray Bitar in which he expresses concern over an announcement of company layoffs saying that it could cause a “new run on the bank” and that “we can’t even take a five million run”.