Thursday, September 22, 2011

FULL TILT PONZI

To say it's a mess doesn't even describe it when it comes to Full Tilt Poker these days. No doubt, some business journalist should get started on the book about this wretched company. No doubt a movie is on the way, too. Believe me, I can hardly wait for it -- it ought to be a good one.

The big story from earlier this week is that the US Attorney's office is lodging a civil complaint accusing Full Tilt Poker of being a Ponzi scheme for its rich owners.

They're saying the poker players who had signed up with Full Tilt were being credited with phony money in their accounts. The money that was in their accounts was apparently raided by the owners to fund their operations! There was supposed to be $400 million in player funds but there was actually $60 million!

Wow, no wonder the players can't get any money back if this is what is going on over there. What a gong show. Story from the Wall Street Journal.

I don't doubt things have really taken a turn for the worse over at Full Tilt Poker, and the players all have a right to be mad at them for failing to return their money and for a variety of mismanagement and alleged criminality over there.

But to call it a Ponzi scheme?! Wow, that's pretty charged language -- in league with Bernie Madoff and the like. Why not simply call them "crooks" and be done with it?

Some, like Pauly over at Tao of Poker, still wonder why the DoJ is going after the Full Tilt people and not the folks on Wall Street who ran the USA into the ground. Good point, but that doesn't excuse the folks over at Full Tilt Poker for raiding accounts, if that is what they were doing. It doesn't take a genius to realize that's a no-no. If Full Tilt Poker was having any serious cash-flow problems, they needed to shut themselves down and close down everyone's accounts, and return everyone's money. But they DIDN'T.

A lot of poker players are still waiting for Full Tilt to refund them their money, and if this is indeed what was going on, then it explains a lot about what has gone on over the past few months over at Full Tilt, what with player funds not getting returned and with their online license getting revoked and so on.

A lot of fingers are being pointed towards Howard Lederer and Chris Ferguson, the two star poker players who were the two biggest bigshots at Full Tilt Poker. Much of the poker community now hates their guts and wants them locked up, and the Epic Poker League has now kicked both of them out.

Well, someone has to take the blame for this mess, and if this mess was created due to players' funds getting raided, then there is no doubt in my mind that heads have to roll and people need to be thrown in jail. What this is, essentially, is players' money getting stolen, if true. End of story.

Anyway, here's a piece that ran on CNBC about this whole mess.


Once again though, I gotta say this is all a sad situation where once again the online players have wound up the biggest losers. The collateral damage as a result of all these "Ponzi" allegations is that you'll probably have people in the USA trying to use this as their excuse to continue efforts to keep on shutting down online poker. That's no good for the players who've made their living off online poker in the USA and who want to play on credible sites for real money. Some of them have even moved to Canada and elsewhere to continue playing online -- though, obviously, not for Full Tilt Poker anymore.  Personally, I think this whole mess involving Full Tilt is Exhibit A for why you need a regulated environment to begin with. If there were rules in place ensuring online poker sites were well-capitalized, you wouldn't have any of these problems. Period.

Anyway, this is all another black eye for poker. Too bad.

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