Category: Poker Rooms

Full Tilt Poker, it seems, is bound and determined to stay in the news, one way or another. The ongoing negotiations between Groupe Bernard Tapie and the United States Department of Justice are making news again– this time because several professional poker players still owe the site a hefty debt that is throwing a wrench into the sale of the company.

Groupe Bernard Tapie’s lawyer, Behnam Dayanim, has stated that the debts owed by big-name players (almost all of whom were at one point Full Tilt Pros) are only one among a number of problems that are stalling the company’s purchase of the now-defunct poker site from the DOJ, but when certain pro players owe FTP somewhere between 10 and 20 million dollars, it’s certainly a big issue, and one of the hardest to address.

Dayanim broke it down like this: “The analogy that I like to use is that if you think of the target as a shiny apple. At the start of the diligence process, you expect that there are going to be some bruises on that apple, but after you finish your diligence, the problem here is that there are more and deeper bruises than we had anticipated. The professionals’ obligations to the company are a larger and deeper bruise than we had hoped, and we have had less success than we had hoped in trying to brush off that bruise.”

It’s no wonder that GBT’s lawyer uses the apple analogy, as FTP has been less than forthcoming about their finances, and these debts only came to light due to extensive searching by the prospective buyers. Dayanim stated that very few of the players who owe money to FTP have made any effort or expressed any willingness to pay it back. These players include Phil Ivey, David Benyamine, Barry Greenstein, Erick Lindgren, and Mike “The Mouth” Matusow, although there’s speculation that the debts extend all the way through the lineup of recent Full Tilt Pro players.

Will the Full Tilt Poker sale be completed as hoped, or will negotiations fall through because of this? If the sale is the only way that players can hope to get their money back, what does it mean if the GBT sale doesn’t happen? Perhaps most importantly, if the other issues can be resolved but the big-name pros who owe the company money refuse to make good on their debts, can we expect a backlash against these players by the little guy who may never see his money again? Let’s face it– if you leave a drowning company with a few million of the company’s money, you’ve come out ahead, but if the company is holding onto your funds, then you’re at a loss. Doesn’t it seem like the wins and losses should be the same across the board, rather than the more famous players being blatantly privileged?

The US Department of Justice has issued a resolution deadline of February 29th– stay tuned as we bring you news of the latest developments in this and other poker news.

Eight professional poker players have filed a lawsuit against Ultimate Bet for a scam that the company ran three years ago, which allowed the Cereus Network (which owns Ultimate Bet and Absolute Poker) to embezzle 20 million dollars from UB players. The players are out to crucify Ultimate Bet for a violation of the Racketeer Influenced and Corrupt Organizations Act (RICO), a piece of legislation originally created to allow the government to prosecute organized crime.

These are not the first RICO charges that have been brought against the site or its parent network. Ultimate Bet has been in dire straits since Black Friday, which became a turning point for the poker world not because the United States Department of Justice closed down three of the leading online poker sites, but because of the way those various sites reacted. The problem that Ultimate Bet faces now is not unlike the problems facing Full Tilt Poker– just on a smaller scale. It all boils down to a company taking money from players, knowing full well that what they were doing was not legal, and then refusing to give it back.

The difference in this particular case is that last time, it was the government who was angry, as they didn’t get their piece of the pie while UB schemed to get around US government regulations. This time, it’s the players who are out for blood for unfair play. While Ultimate Bet previously held the upper hand and could play the victim in a big governmental misunderstanding, putting the blame on the US Department of Justice, this time, there’s no one else to blame, and the players are backing away from a site that they believe has done the unforgivable. To scam a government is one thing (come on– poker has always been a game of rebels), but to scam your clients, your paying customers– that’s another thing entirely.

The eight who have brought this case against UB include well-known Canadian player Brad Booth and notable American players Tom Koral, Daniel Ashman, and Dustin Woolf, along with Greg Lavery, Dave Lizmi, Joseph Sanders, and Daniel Smith. The suit represents players from three different countries in their attempt to recover their lost money as well as an injunction and damages from emotional distress, fraud, negligence, unfair business practices and other charges associated with RICO, and the potential economic damage that the players suffered.

The complaint filed last week refers to a number of unnamed defendants, known as John Doe 1-10. This anonymity is not due to an effort to maintain privacy surrounding the lawsuit, but because the plaintiffs don’t actually know who is directly responsible, due to the coverup for which they’ve cited a RICO violation:

At this time, plaintiffs suspect but do not know the identities of Does 1-10. Evidence, some of which is discussed below, has arisen that some of the founders and management of UltimateBet and Excapsa, including Greg Pierson, Jon Karl, Jack Bates, Russ Hamilton, and others who formerly operated (and may continue to be involved in the operation of) UltimateBet were likely aware of or involved the conspiracy to cheat players. However, because the identities and activities of UltimateBet and those who have profited from its operations has been intentionally shielded though numerous agents, subsidiaries, and foreign corporations, it will be necessary to conduct significant discovery before a complete list of defendants can be identified. After such discovery, plaintiffs will seek to amend the complaint to add additional defendants.

The real question about this lawsuit is this: why have the defendants waited until now to file this lawsuit? Why the three year delay after Ultimate Bet has already admitted fault and made efforts to repay players? The answer to this seems more closely related to Black Friday than it would seem at first glance: “Sorry” simply isn’t good enough anymore.

The Alderney Gaming Control Commission (AGCC), from whom we’ve heard a great deal during the course of the Full Tilt scandal, has issued a new statement to British citizens, urging them to take action. While the AGCC doesn’t come out and say that British players who are still owed money by Full Tilt Poker (some of the 440 million dollars in player funds that have been held by the company for almost a year now) should press legal charges, they certainly imply it. The most recent press release from the gaming commission informs players that they should contact their local authorities if they feel that they have been the victim of a crime, and also reminds them of the many legal cases currently pending against Full Tilt– just in case some British citizens are starting to think that they should get in on that action.

It’s been a while since the AGCC has released a statement, and countless former Full Tilt players have been waiting for quite some time for news regarding the company’s outstanding balance. All in all, there has been little for anyone to report, as Full Tilt Poker still seems to be stalling, despite a change in ownership and an alleged deal between Groupe Bernard Tapie and the US Department of Justice. The DOJ shut down Full Tilt, along with PokerStars and Absolute Poker/Ultimate Bet back in April of last year, and FTP remains the one company who hasn’t at least partially resolved the problem. Groupe Bernard Tapie struck a deal with the US Department of Justice so that they could purchase the struggling company for $80 million in November, but there has been radio silence since the acquisition.

The AGCC explains its silence in their most recent statement: because the group no longer licenses or is attempting to restore the license of Full Tilt, they are unable to mediate or intercede in problems with the former poker giant (except for customers who are registered in Switzerland). Since they can no longer offer any help to their fellow British citizens, the AGCC offered this statement:

Players may have the following alternative options:

1. Full Tilt has been requested to provide a specific player contact: this is awaited and will be incorporated here upon receipt.
2. Any player who believes they are a victim of crime, as a result of their dealings with Full Tilt, should in the first instance contact their own local police in their country of residence and report the matter to them. These reports will then be coordinated centrally.
3. It is understood that a number of civil actions have been initiated by players against Full Tilt, some as class actions representing multiple players by UK, US and Canadian lawyers. Details of the firms concerned can be found through internet search.

The AGCC also mentions that they have been collecting incident reports on behalf of the police, and that customer complaints have been and will continue to be taken and turned over to the authorities. This is perhaps the nature of this “centrally coordinated” police action against Full Tilt– it seems like the company is soon to have a lot more problems than it had before. If its troubles with the DOJ and the numerous class action lawsuits were insurmountable obstacles before, Full Tilt may end up wishing that they’d cashed in and given up when they had the chance.

As thought Full Tilt officials haven’t had enough to worry about, it now seems that Absolute Poker/ Ultimate Bet is gearing to put the final nail in the former poker giant’s coffin. According to a statement from the Kahnawake Gaming Commission, Absolute Poker and Ultimate Bet Poker will be paying back their former clients as soon as possible. To players who have seen their assets frozen since April, this hardly seems like a timely action, especially since PokerStars returned player funds months ago, but Absolute and UB have only recently resolved their problems with the United States Department of Justice, which means that players may soon see some return on accounts that have been frozen since Black Friday. The solution? To sell off the poker sites and use the revenue to pay back customers.

Blanca Games, the company that owns Absolute Poker and Ultimate Bet, intends to sell off the two subsidiaries and use the proceeds to pay back customers. This will almost surely mean the death of these sites, but with no presence in the online poker world for over 6 months, their fate was likely already sealed. However, the important question has to do with whether or not selling off AP and UB will generate enough revenue to equal the $54 million that’s currently owed to players. After all, Absolute/UB doesn’t lead the online poker world in software, and internet businesses aren’t like the mom and pop store on the corner– there’s no storefront, no five year lease on an office, no thousands of dollars worth of equipment that can be auctioned off to the highest bidder. While there are assets to liquidate, it seems doubtful that they’re going to create enough to pay back all the players in full. The exact wording in the press release from the Mohawk Territory of Kahnawake is this:

• “Over the past several weeks, we were advised of a potential solution prepared by Blanca and its representatives, establishing a process to liquidate Blanca’s assets and distribute proceeds to players. We understand that this process has been presented to SDNY for consideration and approval.

The Commission’s foremost concern in this matter has been, and remains, the reimbursement of both US and non-US players, as quickly and completely as possible.

To avoid further prejudice to affected players, the Commission has demanded that all parties complete their discussions and implement a reimbursement solution without further delay.”

So what does this mean for former Absolute and Ultimate Bet Poker players? First of all, it may mean that while you’ll see some of your money returned, you may not see all of it. Ever. Some are theorizing that former players on the Cereus Poker Network may be looking at returns at 50 cents on the dollar– if that. Secondly, even a partial reimbursement is likely to create even more anger directed at Full Tilt Poker, which has yet to pay back its customers, despite the fact that the company is being bought by an investor, not sold off in pieces. Lastly, it means that Cereus Poker Network will likely be no more.

Absolute Poker and Ultimate Bet Poker were bought by Blanca games in August of 2010, after UB had been under fire from the Kahnawake Gaming Commission for a cheating scandal in which they were ordered to return $22 million to clients. Because Blanca also (partially) owns Helix Gaming International and BingoMania.com, there’s a good chance that this current deal is their way of playing nice with the KGC so that they can be on the group’s good side when it comes time to discuss new legislation for online gambling and the potential move to the US down the line.

Once again, Full Tilt Poker is facing some legal trouble– this time at the hands of a team of lawyers who are leveling yet another class action lawsuit against the company. Unlike previous lawsuits, however, this one is aimed not just at owners and heavy hitters for the company, which has been defunct since Black Friday last April, but also against Full Tilt’s legal counsel, the law firm Cozen O’Connor.

This particular suit is worth a hefty 900 million dollars, and it relies heavily on the United States’ RICO legislation, which is set up to protect individuals against racketeering and organized crime. According to the lawsuit, Cozen O’Connor has received over two million dollars in exchange for services directly related to covering up FTP’s illegal business practices. These accusations may draw the attention of the US Department of Justice, which is already investigating Full Tilt for the money laundering that their lawyers allegedly helped to conceal.

Legal precedents indicate that this means that the lawyers (as well as FTP themselves) should be returning all of those ill-gotten gains to the people from whom those funds were taken. Lary Kennedy and Greg Omotoy, who filed the suit in the U.S. District Court for the Central District of California, have left room in their lawsuit for a total of 200,000 plaintiffs, all of whom have the right to seek both the return of their money and damages from the company. In similar cases, all those who have benefited from an organization’s shady dealings have been forced to return the money they gained.

According to the lawsuit that Kennedy and Omotoy have filed, the problem with Full Tilt Poker seems to be largely that they’re operating like the large, corrupt corporations against which American citizens are currently rebelling– FTP, according to the lawsuit, failed to “create financial reserves for amounts held on behalf of players,” and instead took player money and spent it elsewhere, including handouts to key defendants and pushing forward a money laundering scheme.

If there’s one thing that the Occupy Wall Street has demonstrated in the past month, it’s that the vast majority of Americans are tired of seeing large corporations steal their money, break laws, and then get bailed out by larger corporations (or the government). What’s a poor corporation to do when they’ve made a few mistakes here and there, and now the angry mob steadily approaches? To start with: apologize.

There’s a saying that an apology consists of three parts: admitting that what you’ve done is wrong, acknowledging the damage caused and vowing not to repeat past mistakes, and making reparations to those who have been harmed. PokerStars, which was in the same boat as FTP on Black Friday, managed to make nice with their clients and the US Department of Justice because they managed to apologize– as such, their business has not suffered and has even grown. Perhaps Full Tilt could learn something from this model, if only to say, “Sorry we messed up… now let’s talk about how we can get your money back to you.”

French investment company Groupe Bernard Tapie has been busy this autumn, making plans to take over Full Tilt Poker and engaging in all the business that entails while also planning a poker tournament and trying to ease the minds of legislators and players alike.

Groupe Bernard Tapie has a list of conditions that will need to be met before they’re willing to take over Full Tilt Poker. While hesitance from any company to take over what is widely regarded as a sinking ship is certainly understandable, the French company seems to have something up their sleeves. This isn’t just because Bernard Tapie, the company’s namesake and the father of current CEO Laurent Tapie, has a controversial history as a businessman, although his jail time and criminal history for match-fixing, tax evasion, tax fraud, and doctoring the books certainly doesn’t serve to make this deal look any more legit. After all, FTP has also been engaging in some seedy practices as far as the players are concerned, so Tapie, while a successful businessman, may not have the moral standing to give heart to players that have already been burned once.

Among these conditions are the hopes that the US Department of Justice will pay off the players who have seen their accounts frozen since April from the assets seized on not only Black Friday, but during the course of the last four years, as well as a full audit of FTP’s finances and approval from a licensing authority, allowing Full Tilt to begin operations again. Despite the fact that none of these conditions have been met yet (and some are very up in the air, as such cooperation from the DoJ seems unlikely, given the aggressive stance that the governmental agency has towards online poker violations, and Full Tilt’s financial practices are still in question), Tapie has released a statement that former FTP players will be offered equity in the site, and the current owners will be allowed to invest in the revived company. If Groupe Bernard Tapie isn’t paying the customers back, and former players and current owners are given a nudge towards helping to finance the company, what exactly is GBT paying for? Perhaps players are still too jaded to think clearly about Full Tilt, but the idea that there are back room deals going on with a company that is attempting to do anything other than man up and push FTP to take responsibility for the slight against the poker community leaves many people feeling completely uncomforted by this potential regime shift.

Groupe Bernard Tapie recently announced their plans to host the International Stadiums Poker Tour (ISPT), a blend of live and online play that aims to determine who the best players in poker really are. Since the event isn’t scheduled to take place until 2012, the company will have plenty of time to resurrect the Full Tilt reputation and win players back by promising a guaranteed $30 million prize-pool ($10 million of which is the first-place prize). The online element of this tournament is particularly interesting, as players will be competing (at least as the tournament is currently designed, but everything is subject to change) via electronic pads in dedicated online tournament rooms. If GBT is planning on taking over Full Tilt, this would be the perfect way to get players back into the FTP rooms that so many people have sworn that they’re done with. After all, who can resist a chance at ten million dollars?

Only time will tell if Groupe Bernard Tapie can successfully pull this off, but it certainly seems like they’re carefully lining up the pieces that they’ll need to make a successful play. If they’re not careful, however, they may just fall short of the 20,000 to 30,000 players that they’re expecting for the ISPT, as players may not be so forgiving after all.

Players who have money tied up in Full Tilt Poker will be interested to know that the site released an “exclusive news update” to pokernews.com today, regarding their status with the undisclosed investors. Full Tilt, in the past, has been less than forthcoming with information regarding what, exactly, is going on with the site, which was previously one of the largest online poker sites in the world, and now they’ve released a short private statement, which seems to be code for “we don’t have any good news to report, or we’d be sending this out to every news source, social networking medium, and former customer.”

The long and short of the press release is this: Full Tilt has “concluded the exclusivity period of negotiations with their current potential investor”, and now the site is looking for “additional potential investors to conclude the sale/partnership of the Full Tilt Poker brand and its assets”. English translation? They’ve got nothing. No investor, about whom we’ve been hearing for months now– and so much of the hope that former FTP customers had about getting their funds back in a timely manner hinged on this alleged investor (don’t put it past Full Tilt to invent investors to keep the wolves at bay, if that’s what it takes to buy some time). Past news reports stated that this investor was working with the US Department of Justice to deal with the class action lawsuit and get American players their money back, but without this investor, players shouldn’t hold their breath for timely repayments.

If the class action lawsuit from the States weren’t enough, Full Tilt Poker has just been hit with another– this time from Canada. The lawsuit is against Pocket Kings ltd (the owners of Full Tilt) and several of their subsidiaries, although it names many of the big name players for the site as defendants, including Ray Bitar, Howard Lederer, and Nelson Burtnick. Apparently, American players aren’t the only ones getting a little miffed that Full Tilt hasn’t paid back even a cent of the money owed their players (save, of course, for their alleged payments to certain FTP Pros).

Full Tilt also lost their Chief Marketing Officer, Lothar Rentschler, this week. His farewell email, sent out to many media outlets, was essentially an apology and expressed disappointment in the way that Full Tilt Poker is going. When you have nothing left to market because you’ve been shut down, there’s apparently no need for a Chief Marketing Officer anymore.

Full Tilt Poker has their hearing with the Alderney Gambling Control Commission scheduled for September 15th. Jeff Ifrah, one of FTP’s attorneys, issues a statement that “nobody wants to come to September 15th and not have a deal which is either finalised or close to finalisation to the point that it can be shared with Alderney and result in extension of that date.” It seems that FTP will be looking to file another extension, which is likely to further anger already outraged players.

The site has carefully worded their press release to imply that giving out too many details of their situation may be dangerous in terms of finding new investors (that doesn’t bode well), and, as they go on to explain, their first priority is finding a buyer so that they can use the capital to repay the players. So, wait… if no one buys Full Tilt, what happens to everyone’s money?