The Lederer Files Highlights and Analysis
PokerNews.com recently released a seven-part interview series with former Full Tilt kingpin Howard Lederer called The Lederer Files. Even though Howard didn't seem to know much in response to the poker world's burning questions about the downfall of Full Tilt, the interview had its interesting moments. Here is a recap of some of the highlights from the 3.5 hour long interview and its resulting fallout among the poker community:
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Bitar Thrown Under Bus
Lederer was not shy about throwing former Full Tilt CEO Ray Bitar under the bus. It was clear that Lederer was using the interview as a stage on which to shift blame to others. Much of this blame was directed at Bitar who Lederer said he never met until Chris Ferguson brought him on board to run the company.
One of Lederer's most damning comments regarding Bitar was when he stated the following in response to the company's issues with player deposit shortfalls, "I believe I would've found out about the problems and obviously I don't think Ray would have continued as CEO."
Lederer also suggested that certain owners of the company did not like Bitar. He specifically mentioned John Juanda as having been vocal in the "anti-Bitar camp". Also referenced were clashes between Perry Friedman and Bitar which led to Friedman leaving his role as a programmer for the company. Friedman later started a trend of owners bringing their lawyers to company conference calls. Said @AgentMarco on Twitter, "It says a lot about Bitar that Perry Friedman could not get along with him. I met Perry this summer. It's impossible to get on his bad side."
Ivey Worthless as Board Member
The original board of Full Tilt Poker consisted of Bitar, Ferguson, Lederer, Friedman and Phil Ivey. Said Lederer, "Early on it was clear it'd be hard to get Ivey on the phone for a meeting, so he stepped down."
This reinforces the image that Phil Ivey is a primadonna whose relationship with Full Tilt Poker was mostly selfish in nature.
Ferguson Argued Against Distributions
In the interview, Lederer gave varying impressions of Chris Ferguson. On one hand, Ferguson was somewhat thrown under the bus for being the guy who brought in his friend Ray Bitar to run the company. But Lederer also gave Ferguson considerable credit for having the foresight to determine that owner distributions were a bad idea for the company.
When Full Tilt had grown to have $20-$30 million in excess cash on hand, a majority of board members determined it was time to start processing cash distributions to owners. Lederer says that Ferguson championed against this arguing that distributions would weaken the company. Lederer claims that Ferguson's only use for the money was his African charity and that he otherwise lived a modest lifestyle living in a 1,500 square foot Vegas home.
What doesn't make sense, however, is why Ferguson, known for his shrewdness and stance against owner distributions in the company, wasn't monitoring more closely company financial records to ensure that they could continue affording subsequent distributions.
Move to Dublin Resulted in Lazy Board
One gains a sense from the Lederer Files that Full Tilt's real problems began when the company relocated from California to Dublin in hopes of eventually floating on the London Stock Exchange.
According to Lederer, it was after this move that Bitar gained tighter control of the company. As distributions continued to roll in, U.S. based board members were more concerned with buying real estate and living the good life than keeping tabs on Full Tilt's balance sheet. Lederer claimed that no board member ever demanded to know exactly how much cash the company had on hand and how much it owed to its players.
A lot of ground was covered in The Lederer Files. For those really interested in the specifics of Full Tilt's demise (from Howard Lederer's perspective), it's a must-watch. But in the interest of brevity, we would sum up the lessons from The Lederer Files in the following way:
The persons managing the company were unqualified to be doing so from day one. When Full Tilt began having a lot of success as a startup venture, a decision should have been reached to hire professionals with management experience in the gaming industry. While some such managerial hires were eventually made, the company remained chiefly in control of Ray Bitar and poker pro board members with no true qualifications for running a large organization.
It will be interesting to hear responses to the Lederer Files from other Full Tilt insiders. It seems clear that Howard Lederer is a gifted manipulator so one would be wise not to believe too strongly that his side of the story presented in the interviews mirrors the truth. Already, John Juanda has aired his displeasure with Lederer's interview stating, "As Ray Bitar's boss, Howard Lederer should've accepted more blames instead of trying to shift blames to everyone else."
One would imagine that others will be eager to share their side of the Full Tilt story perhaps from the confines of a U.S. courtroom. It almost has the makings of a Hollywood movie if it just wasn't so damn pathetic all around.