How Things Became So Screwed Up At Full Tilt Poker

83 thoughts on “How Things Became So Screwed Up At Full Tilt Poker”

1. What full tilt poker did to its players is unbelievable. Full tilt were trusted members of the online poker community and swindled players out of their funds and screwed the players over!! I wouldn’t touch them with a barge pole now days.

2. I’m glad most of the players in the rest of the world have their money back now. I’m one of the lucky ones at the time I got 90% of my bankroll off of fulltilt about 5 days before all funds were frozen.

3. Interesting article. It’s good to get a detailed description about the story of Full Tilt and what went on as most people were left in the dark about it!

4. Interesting take on what has probably been the most damaging scandal ever to have hit poker. Although I appreciate your post is just speculation/ opinion I find it hard to justify in any circumstance the actions of Full Tilt Poker. Lots of big companies face changes in legislation and poor market conditions, it is not a good enough reason to engage in fraudulent activities and steal from innocent victims. I hope online poker can claw back some of its credibility but there is a long way to go, particularly in the U.S.

5. Although I like your article and to some extent think your “speculation” is reasonable, I think it is important to underscore just how unacceptable their businesspractice really was. I am sure you agree that it was. Allthough this article sheds light, which is good, it could cause some to have a more forgiving attitude towards the leaders of FTP than what they should. What they did was totally unacceptable, regardless of whether there was malicious intent or not, thats totally besides the point. They messed up, they gambled with money that wasnt their own, and there is no reason to view that with any “milding” circumstances. They caused serious injury to many people as a result of these gamblings. It ws recless, negligent, unacceptable, and egoistic. They need to get punished in my view for what they did, and nobody should have much sympathy for them in my view, yes, even though they are human and maybe didt have directly malicious or evil intent. That doesnt matter. They were recless, and they gambled with others money. That is unnaceptable, and should be punished.

6. Living with ripping off the wrong people- back to the wall for the rest of their lives, and then…..

7. Once they co-mingled client funds with their own, they broke the law. I’m not really sure their reasons for doing so matter. They certainly don’t mean anything from a legal prospective. If one were to steal money and then give it to charity, he is still guilty of theft.

   I am amazed at the similarity of this case and the MF Global situation, where MF did the same thing with client money. In both cases, people should go to jail. I don’t see any alternative. If you lost 10 grand, would you be comforted by the fact that they really meant to repay you at some point. I doubt it. Meanwhile, the fact remains that while all this was going on, the owners enriched themselves by millions of dollars. At least a bank robber has the balls to walk into a bank. They stole millions via stealth. Although I didn’t lose any money, I really do hope some of these guys get hard time.

8. wonder if they thought about they might be ripping off the wrong dude a rec player with a little organized crime background that might like to hunt the dogs down until…….

9. @Frank: Thanks for your insights on this. Very interesting.

   I will add that part of my views on Ferguson and Furst have to do with my knowledge of how involved they were in the day to day business. Ferguson and Furst seemed the farthest removed from decision making. Bitar and Lederer were the main decision makers up until at least 2006 when I left the company.

   As to the other pros you mention, many of them own (or did own) equity in FTP. Not all but most of the original ones.

10. Bill: As an experienced criminal defense attorney, I can tell you that how “nice” a person is often has no bearing whatsoever on whether they may have violated federal law. I have represented many people over the years who have committed federal crimes (and State crimes) and if you were just going to judge them by their prior lives or actions, you wouldn’t think they would have done what they did. But when big sums of money get involved, all bets are off. It’s hard for me to imagine that Lederer and Ferguson did not question at all their receipt of millions and millions of dollars from FTP and not wonder if this was coming from company profits or, possibly, from player accounts. Especially if what I’ve read is true that a lot of these distributions were deposited in Swiss bank accounts. If you’ve read the U. S. Attorney’s Office’s press release re: the amendment of their civil forfeiture complaint adding Lederer, Ferguson & Furst as defendants, the government is seeking to forfeit all of these distributions they received. They will be tied up in litigation for years until this is resolved. The Manhattan U. S. Attorney’s Office is probably the best in the country, and I guarantee you that they have not made claims in the civil forfeiture action frivolously. These guys will no doubt spend whatever other money they can come up with to defend themselves in this action, and they at least face the possibility of being added to a superceding criminal indictment as well. Time will tell. I really feel for the online pros (as well as avocational players) who had substantial balances in their online accounts, because they will NEVER see those funds. They should accept that reality and move on. It will be interesting to see if the “Professor” and “Jesus” will be able to sit down at a table again with any of the other online pros who lost large sums of their money as a result of the FTP fiasco. I can imagine that there may be some hostility just beneath the surface toward them for quite some time.

    What I am wondering is what about the other FTP pros, Ivey, Dwan, Cunningham, Gordon, Harmon, Juanda, Lindgren, et al? Were they just compensated team pros who weren’t shareholders as were Lederer, Ferguson & Furst? Surely their loss of FTP’s sponsorship and whatever compensation they may have received, including buy-ins to tournaments, will hurt them financially. What’s their position vis-a-vis Lederer, Ferguson & Furst?

    It seems that one of the casualties of all this is the cancellation of Poker After Dark. All of a sudden, it was pulled of the air by NBC, and I’m guessing the reason is that NBC’s ad revenue must have plunged with the withdrawal of ad placement by PS and FTP. Do you know anything about that?

    This whole mess has in my humble opinion set back any possibility of online poker being considered for legalization and regulation by Congress in the foreseeable future. If the legislators and regulators in Washington could only see that the potential tax revenue from a regulated online poker industry could provide a substantial funding for health care, for example, then maybe something could happen. But now I think it will be years away.

    I enjoy your blog, and hope that my comments are not out of line.

    Respectfully,
    Frank Dawkins
    lawyer and poker player
    Lafayette, Louisiana

11. Interesting comments in post # 71, Dan.

    About this “floating” business, I’m curious about something. How did the folks at Pokerstars handle this same problem, (i.e. the difficulty of getting deposits withdrawn from players bank accounts and the money transferred to Pokerstars accounts?) Did Pokerstars basically have a “deal” with payment processors that amounted to: “We don’t care how you do it, just get the money to us and collect a hefty payment [from us] in return for all your trouble.” If Pokerstars was not doing the same thing, then how did they deal with player deposits where they were unable to collect the money? In order to avoid “crossing the line” as you put it, did Pokerstars tell their American players to send deposits via Western Union, international money order, or cashiers check? I’m just curious as to how Pokerstars managed to avoid falling into this same trap as they were surely dealing with the same problem.

    I suppose all these problems and difficulties were preordained. I recall Bill writing a piece a while back pointing out that this chain of events was set in motion when the UIGEA became law. The U.S. Government (DoJ) was like a boa constrictor steadily tightening its grip on these offshore sites until they could no longer breathe.

    This is ultimate irony, but the sites themselves (and their payment processors) did everything they could possibly do to help the DoJ tighten the noose. Whoever dropped a dime on payment processor Daniel Tzetikoff has to be kicking himself in the gonads for being so stupid. There has to be a book in this saga pointing out all the bonehead decisions that resulted in this calamity. (There’s already some steamy sex and drug use to go with all the financial fraud and criminality, so all this needs is a murder – or a mysterious disappearance – to turn it into a Hollywood movie!)

    This Full Tilt fiasco is the latest chapter in the book: “How People Get Totally Blinded By Greed”. I suppose the real lesson here is that you can’t make hundreds of millions (billions?) of [untaxed] dollars while simultaneously giving the USG the figurative bird – and actually get away with it. Team Full Tilt was very “in your face” in the way they went about flaunting their success. (Recall the full page ads in Card Player magazine and on PAD where they’re walking down Fremont Street as if they own Las Vegas?) That kind of hubris was bound to draw the Government’s ire.

12. I agree that it is highly unlikely that these individuals came into the online poker community with the intention of ripping players off. At the same time they directly and intentionally violated written laws knowing the possible outcome. They are morally and criminally wrong.

    A criminal is a criminal. Some criminals commit burglaries by scouting out potential homes, watching the owners, learning their schedules and then striking. These are calculated criminal looking for opportunity. Then there are those who just end up walking down a street on a particular day, seeing an open door to a nice house, running in, and stealing something. Their intention that day was not to steal anything but the opportunity presented itself and they crossed the line and did it. Either way, both of these people are burglars.

    The problem in general with crossing a moral line is that once you cross it, it becomes easier and easier each time. Each time you do it the line that was previously drawn in the sand is pushed back farther and farther. It happens to many people in their lives, but most don’t have lawyers, accountants, analysts, etc, to advise them of the consequences. FTP did.

    Finally, I find it funny considering this as a whole and thinking FTP floated the money in an attempt to keep the site open and make money. At the same time I know countless people, who were smart enough to realize, that when they made deposits nothing was being withdrawn from their banks. As a result they deposited max in an attempt to free roll FTP thinking ‘if I win I will just cash out and if I lose o well, to bad for FTP. The chase is on.’ Did FTP really think that not even a small percentage of their players would realize what was going on and a percentage of those people would try to take advantage of it? I would LOVE to see the daily deposit history of FTP before and then after they decided to start ‘floating’ players money.

    Good job FTP. Enjoy jail

13. as long as money is involved there is always greeeeeeed.
    Im just sipping a drink and enjoying all the cash.

    /Bubba

14. Damn, i’m lucky I didn’t deposit to ftp :O pokerstars ftw 😀

15. Well, to be honest, the DOJ doesn’t really get into the details behind the numbers. For instance, it quotes the $443,860,529.89 in distributions from 2007 – 2011 but doesn’t state how much was paid out AFTER they started dipping into player funds. Everything before that is nothing different than any other company paying a dividend.

    Trying to piece together the financials based on the DOJ complaint isn’t doable.

16. I understand what you wrote. You explained it well. It just doesn;t seem to match the facts as outlined in the complaint:
    “By March 31, 2011, Full Tilt
    Poker owed approximately $390 million to players around the
    world, including approximately $150 million to United States
    players. However, the company had only approximately $60 million
    in its bank accounts.”

    So, they were short $330MM right? Ok, now this is what you wrote:

    “Per your last paragraph: It is true. FTP didn’t fail on collecting every deposit so your experience does not represent what happened across the entire FTP database. There were up to $60 million that FTP was unable to collect when the player made the deposit. That’s documented in the DOJ complaint”

    So, if FTP was unable to collect “just” $60MM, how could they be short $330mm?

    Now read this from the complaint:

    Furthermore, as alleged in the proposed Amended
    Complaint, the company used player funds to pay its Board of
    Directors and other owners. Between April 2007 and April 2011,
    Full Tilt Poker and its Board distributed approximately
    $443,860,529.89 to Board members and owners. Bitar received
    approximately $41 million, Lederer received approximately $42
    million, and Furst received approximately $11.7 million.
    Ferguson was allocated approximately $87,486,182.87 in
    distributions, and received at least $25 million, with the
    remaining balance characterized as “owed” to him. Much of the
    money that was distributed was transferred by the Board members
    and owners to accounts in Switzerland and other overseas
    locations.

    While this period covers 4 years, it was obviously still going on while they were short funds.

    So, to sum up: They were short 330MM. They paid this money out to themselves. Much of the money was sent to overseas bank accounts, which would seem to indicate the recipients were trying to hide/shield the money. How can you not claim this was a complete Ponzi scheme? Even if I accept the $60MM shortfall as you stated, what happened to the rest of $270MM? According to the DOJ, they stole it. Do you disagree?

17. No offense, NJ, but you don’t seem to even understand the crime so I don’t know how you can say “I could buy your argument if . . .” You currently don’t understand my argument. 🙂

    1. I explained this in the post. FTP loans you $100 which it hopes to collect at some point in the future when they figure out a new payment processor to collect the $100 from your bank account. In the meantime, they’ve lured you away from PS since PS can’t process payments from your bank either.

    At some point in the future FTP collects the $100 so they get their $100 back plus they get rake that you generated.

    But BF stopped that collection from happening. So FTP got stuck holding the bag. And since you don’t have the $100 in your FTP account anymore (you lost it) they can’t tell Player B he isn’t getting paid since he won the money fair and square.

    2. At a monthly or quarterly interval the FTP board paid shareholders a profit sharing dividend. This had been going on since 2006 or 2007, long before they started dipping into player funds. That money was then wired out to shareholder bank accounts. The part which you are referring to is that they kept on paying out the profit sharing even when they were using player funds to loan to other players.

    Per your last paragraph: It is true. FTP didn’t fail on collecting every deposit so your experience does not represent what happened across the entire FTP database. There were up to $60 million that FTP was unable to collect when the player made the deposit. That’s documented in the DOJ complaint.

18. Ok, I understand. Thanks for explaining this. However, I still don’t understand this:

    1. Why would FTP do this, unless they thought they were going to profit somehow? I mean, every Ponzi scheme will eventually collapse. Here though, they had a presumably profitable business model, so why do this?

    2. The DOJ claims that they wired money out of the accounts to themselves. Therefore, how can you claim “There was no intent to steal the money. “???

    Look, maybe I could buy your argument if they were lending the money for a very short period, say a couple of days. I don’t condone it, but I understand it. Here though, you seem to imply that no money was being transferred in for months! BTW, I know thats not true. I had money transferred in and deducted from my bank account. Therefore, one must conclude they did this deliberately, with absolutely no intent to repay anyone. How could you think otherwise? Otherwise, why on Earth would they continue to lend hundreds of millions for months if they didn’t intend to steal it????

19. I’m not sure what part you don’t get NJ Guy so I’ll walk through the logistics of it.

    Player A Bank Account = $100
    Player A FTP Account = $0
    Player B Account = $0

    Player A deposits $100 on FTP but FTP does not collect the funds from the players bank.

    Player A Bank Account = $100
    Player A FTP Account = $100
    Player B Account = $0

    Now Player A uses his funds on FTP and loses them to Player B

    Player A Bank Account = $100
    Player A FTP Account = $0
    Player B Account = $100

    Black Friday happens and the DOJ seizes a bank account holding Player B’s money.

    Player A Bank Account = $100
    Player A FTP Account = $0
    Player B Account = $0

    So now FTP has a $100 liability to Player B and it is legally prohibited from trying to collect funds from Player A. Player B’s money has been seized by the DOJ but since FTP was commingling funds with their operational funds the DOJ has no reason to release the seized funds.

20. I’m sorry, but I still don’t get this. You wrote: “1. They were crediting the deposits to the player’s accounts and letting them play with the money even though they knew that they were unable to debit it from the player’s account. ”

    Ok, so lets say they “lent” players $200mm to play with. Poker is a zero sum game. Actually, it’s a negative game because of the rake. If the money was never debited from the player’s accounts, why would they owe it back? Even assuming that some of the winners took their money, FTP would probably still be ahead of the game, otherwise, why would they do this lending in the first place? Therefore, how could they possibly owe over $300mm? They never received it in the first place!

    I think the obvious answer is that they might have lent the money originally, but they eventually received it. As such, how can one explain that they owed $300mm? Now, the fact remains that they only had $60mm on hand, which means they literally stole the money. Grand larceny is still a crime, isn’t it?

21. @Former DJ: I would disagree with you on that. I think that legalization will come a lot faster than we anticipate now that Stars and Tilt aren’t sabotaging the process by insisting on immunity.

    [per Bill Rini @ Comment 61]

    Bill:

    This is one case where I hope you are right – and I’m dead wrong. On the plus side Gary Loveman, Jim Murren, and Frank Fahrenkopf are all expressing optimism. These guys aren’t lightweights – they’re all heavy hitters highly experienced at working within the political process. (Mr. Loveman said as much several months ago during a live interview on CNBC.) Plus, the AGA recently hired John Boehner’s former Chief-of-Staff as a senior lobbyist and consultant. All this tells me one thing: The AGA is getting all their ducks in a row. The “mothers milk of politics” (i.e. money) is moving into the campaign coffers of key politicians. Politicians don’t like having to get on the phone and beg for money, so donations that come rolling in voluntarily are favorably remembered. That’s the plus side.

    There is a down side – strong organized opposition to legalization. Legalization of “gambling” is a hot button issue that tends to get religious groups like Focus on the Family in an uproar. FoF has support from politicians in key positions in the Congress including Spencer Bachus and Bob Goodlatte – to name two – plus the very powerful Nancy Pelosi who opposes gambling because “it hurts children” (her words). Even if a bill gets out of committee (which is a big “if”), it will surely face fierce opposition on the House floor, so this is not a slam dunk. Also, there are other “special interests” (i.e. state lotteries, Indian tribes, horse racing interests like Churchill Downs [Twin Spires], et cetera), who will line up against legalization. They’ll be pouring in money too.

    MGM CEO Jim Murren said a few days ago that he thinks the prospects of some kind of bill passing between now and the end of 2012 is “50/50”. That’s better than it was at this time last year, but it’s not a slam dunk. Todd Terry is not optimistic. I suspect if a bill doesn’t pass both houses of Congress (and get signed by the President) before the end of this year, it may be a long time before we see legalization – if ever.

    I hope you’re right – and I turn out to be wrong.

    Former DJ

22. @Former DJ: I would disagree with you on that. I think that legalization will come a lot faster than we anticipate now that Stars and Tilt aren’t sabotaging the process by insisting on immunity.

    That was always the big sticking point. Tilt and Stars kept championing bills that the AGA was never going to allow to pass because their was little financial incentive for them to back online gaming if Stars and Tilt held such a huge dominance in the market. And Stars and Tilt were never going to agree to handicap themselves so they had an incentive to see the legal environment remain too risky.

    Also, the current environment is not as anti-poker as you think. The AGA is very positive about getting a bill passed soon. Now that FTP and PS are out of the equation everybody and their mother is opening play money sites in anticipation of eventual legalization.

23. Stars and Tilt really didn’t want real legalization. They wanted legalization with immunity.

    [per Bill Rini @ Comment # 59]

    Good point.

    It’s unfortunate that both sides in this struggle, (i.e. the “illegal” offshore sites as well as the land-based B&Ms here in the United States), couldn’t resolve their differences, combine forces, and work toward a common goal. Instead both sides chose to fight to the bitter end as mortal enemies. Now, given the present hostile anti-poker environment among the majority of our politicians, it’s doubtful that either party will get what they want – legalization. They both wind up losers.

    Former DJ

24. @Former DJ: You have to keep in mind that PS and FTP were profiting by not challenging the law. You have to remember that back in 2006, prior to the UIGEA, Party was bar far the largest poker room in the world. In fact, Party was bigger than Stars and Tilt combined.

    The UIGEA drove Party out of the US market and Stars and FTP basically split up the Party US players. They were financially incentivized to keep the regulatory environment cloudy. No privately funded room could compete with them and all of the public companies had retreated from the US.

    Stars and Tilt really didn’t want real legalization. They wanted legalization with immunity.

25. Do you know if a victim has any right to invasion of privacy? Do you think america should lawyer up?

26. The law passed in the US and if you disagree with a law and feel that it is unconstitutional you can ask for a court injunction on enforcement until the constitutionality of the law is determined.

    Did PS or FTP do this? No. They decided that their legal opinion trumped the US legal opinion and continued to operate.

    [per Bill Rini’s response to Robert Dudek in Comment # 52]

    Bill:

    I’ve wondered myself why nobody ever saw fit to directly challenge the UIGEA in court and try to get a ruling that this “law” was unconstitutional? Prior to Black Friday, I recall periodic discussions on the 2+2 Legislation forum about just this possibility. The learned opinion of the “legal experts” over there seemed to be, (paraphrasing), “No, we can’t file a direct court challenge to UIGEA because, if we lose, then we lose everything …” – to which I respond, “Well what do we have now?”

    Since it could be years (if ever) before internet poker gets legalized in the United States, why shouldn’t somebody mount a direct challenge of the UIGEA? The PPA estimates that as many as 50,000 individual poker players were earning some (or all) of their income from online poker in the United States. Those individuals have presumably been deprived of their livelihoods by this DoJ enforcement action of a law that has never been challenged or ruled on with respect to its constitutionality. In its “Black Friday” filings, the DoJ cites violation of the UIGEA as if its settled law when, in fact, the UIGEA has never stood up to a constitutional challenge. It will be “costly” to pursue such a challenge against the United States, but how many tens of millions of dollars have these sites lost by not challenging UIGEA?

    Legal challenges to the U.S. government by poker players are not unprecedented. How many of you have heard of “Billy Baxter versus the IRS” – a tax law case that set precedent? (It was long ago, but Billy Baxter won his case.)

    The specifics of this case are obviously different from the specifics of the Baxter case, but what do the major [surviving] offshore poker sites have to lose now by bringing a direct challenge against the UIGEA? If there is a jurisdictional problem, why doesn’t the PPA get off their duff and bring a class action lawsuit against the UIGEA on behalf of all their “members” who have been harmed by passage of this law? It mystifies me as to why nobody has seen fit to directly challenge the constitutionality of UIGEA.

    Former DJ

27. The metaphor; all around the monoply board the monkey chased the weasel the monkey thought it was all big fun pop goes the weasel. Now all we need is a great analogy. Good luck Bill [ they don’t pay you enough ] you can’t buy knowlege.

28. @guccee: I agree on a few of your points. So many things have happened that nobody will probably ever find out about.

29. Innocent until proven guilty apparently is no longer the issue. Follow the money trail then this dark enterprise should show who did what to who. The facts are too numerous without the figures to solve any actions that took place before,during and after the fact. I think its so deep,dark and convoluted that there will be no chance to find the whole truth no matter what. The D.O.J. made a huge mistake by not investigating every aspect of this whole mess before the lockout occured. Go figure truely blind justice by trained observers. All they did was protect the guilty and punish the innocent!

30. Bill, I don’t merely have an opinion – I have logical argumentation.

    I am not saying the UIGEA was necessarily unconstitutional (though it may well be). I am not saying that online poker was LEGAL after UIGEA, Neither of those are ethical concepts. I am saying the UIGEA was an UNJUST LAW and as such not obeying it was the right thing to do. Please show me why it is just that online horse betting is legal in the US and online poker is not.

    Are you trying to argue that FTP and PS were merely committing an act of civil disobedience by getting crazy rich offering online gaming in the US?

    In a sense they were doing exactly that (while making huge bucks at the same time). PS/FTP opposed it by defying it and by funding groups (like the PPA) that lobbied to have it overturned. I am not saying they did this for altruistic reasons, far from it.

    PS Yes I know East Germany doesn’t exist anymore.

31. @Robert Dudek: No, I don’t believe I’m confusing the law at all. I think you are.

    It doesn’t matter if you think the UIGEA is an unethical law. When you become a Supreme Court Justice that might change but until then what you have is called an opinion and everyone has one.

    And even if it is an unethical law, your options are to challenge it or follow it. Ignoring it and claiming it’s unethical while intentionally avoiding challenging the law is not a valid option.

    As far as your East Germany question, you do realize that East Germany is no longer a country, no? But let’s pretend this is pre-1990 and the Berlin Wall still stands and I live in East Germany. Wait . . . why the f*ck am I pretending to be in a oppressive communist state?

    Let’s bring this back to reality. The law passed in the US and if you disagree with a law and feel that it is unconstitutional you can ask for a court injunction on enforcement until the constitutionality of the law is determined.

    Did PS or FTP do this? No. They decided that their legal opinion trumped the US legal opinion and continued to operate.

    Which brings up the other hole in your hypothetical situation, if I believe the law is unjust I can participate in an act of civil disobedience. I can break the law and attempt to draw attention to how unjust the law is. Are you trying to argue that FTP and PS were merely committing an act of civil disobedience by getting crazy rich offering online gaming in the US?

32. The US is protecting domestic gambling interests, which include the land-based casinos as well as the horse racing interests against the online operators who saw the potential of online gambling before Harrah’s or MGM. UIGEA became a tool to flush those guys out of the market before pushing for legalization (as is happening now).

    It is very difficult to see the UIEGA as anything but a protectionist measure.

33. @NJ Poker Guy:

    1. They were crediting the deposits to the player’s accounts and letting them play with the money even though they knew that they were unable to debit it from the player’s account.

    2. Read the above. There is also the case of multiple seizures of FTP funds by the DOJ prior to Black Friday. Those were player funds that were being illegally transfereed between payment processors and FTP. The DOJ seized the assets of the payment processor thus seizing FTP’s player funds.

34. @Former DJ: It wasn’t just Party. It was 888, Ongame, iPoker, etc, etc. For the most part it was public companies vs. non-public companies though some non-public companies left the market as well.

    I think one of the key issues is that the board of directors and other owners of a public company are . . . public. FTP always operated thinking they were outsmarting the DOJ by hiding behind layers of shell companies and claiming that PoketKings (and previously Tiltware) were ONLY consultants to FTP which, on paper, had no employees, seizable assets, etc. Had they been public and all of the information about ownership been made public I doubt FTP would have decided to stay in the US.

    It’s Mitch Garber, not Rich Garber. And he was CEO of PartyGaming.

    I don’t think Mitch ever claimed to be clairvoyant and able to see the future. What the company (the board of directors and senior executives) did communicate to staff was that after considering the legal opinions of not only the internal legal team but external legal teams that the risk to the company was too great.

35. Bill, you are definitely intermingling ethical concepts and the law.

    UIGEA is a fundamentally unethical law, in that it exempts certain forms of gambling, while applying to others (such as online poker). There is no case that can be made that online poker is more harmful than online horse race betting, so why should one be legal and the other not?

    We must then ask ourselves – are we obliged to obey a law that we regard as unethical?

    I would say no. Imagine you live in East Germany, where it is the law that citizens should inform the authorities if they overhear someone making subversive comments about the state. Would you feel ethically bound to obey such a law?

    I reiterate that FTP/Stars did nothing wrong in defying the UIGEA. You attempt to paint this as a choice between money and ethics, but I do not see it as such.

36. @curtinsea: No, it’s not semantics. That’s like saying that first degree murder and manslaughter are the same crime. They’re not. If something doesn’t fit the definition of the crime then it’s not the same thing. It can be Ponzi-like but it is not a Ponzi scheme unless it fits the definition.

37. @Robert . . . which would seem to imply that there is no legal domestic online poker market that the US is protecting.

    But the point I was making is that countries can, at their own choosing, implement restrictions on who can and cannot offer online gaming. So being licensed by the AGCC or anybody else does not constitute blanket approval to offer gaming in any country you choose.

38. Furthermore, France and Italy (and presumably Germany and Spain in the future) have set up a restrictive gaming environment that does seem to pass WTO scrutiny. You cannot just start offering online gaming in France without a French license to operate. Again, AFAIK no online poker company has ever even applied for a gaming license in the US.

    All major foreign operators have applied and been issued licenses in France and Italy. So it is not as if these jurisdictions are protecting domestic industries against foreign competitors (i.e. protectionism, the main concern of the WTO). In the U.S., there is no regulatory structure that would allow foreign (or domestic) online operators to apply for a license. If there were, Stars would be first in line to get one.

39. Thank you for a very informative article. There are a couple of issues I still do not understand. Perhaps someone could explain them to me.

    1. You claim that FTP was loaing the money to players because of problems getting the money transferred. If so, then how could they possibly owe so much money? In other words, if money never got transfered into FTP, why would they need to “return” it?

    2. It is pretty clear that if the DOJ’s allegations are true, these guys deserve to be thrown in jail for Madoff time. The only way they could could owe $300MM and only have $60MM left is because they intermingled client and FTP money and simply stole it. Why would you sugarcoat this? Is there any other rational explanation other than they literally stole the money and just paid themselves?

40. @Robert: The WTO ruled in favor of Antigua on some specific claims. They also ruled for the US on some Antigua claims.

41. @Robert: No, at least in the case of Washington State it was very clear. There was no ambiguity.

42. WTO ruled for Antigua, IIRC.

43. Why did the individual states where FTP was operating illegally not indict them? As I understand it, most of these laws were not written clearly enough to definitively rule that online poker is illegal.

44. yo bernie, when you’re sittin in the day room at your federal pen playin poker… don’t take a check from howard.

    meanwhile, howard and his business associates have given the poker industry another black eye to the public. thanks guys. and, my late night poker tv show is off the air.

    so it goes like this… oh i lost my way and stole $200,000,000.00 from some handy fish.
    yeah me huh.

45. Bill:

    I’ve read your analysis as well as listened to your talk with Mike and Adam on the 2+2 Pokercast.

    Early in your analysis you speculate that Full Tilt’s legal advisors probably never told them (directly) that they should withdraw from the U.S. market after passage of UIGEA. Instead, Full tilt’s legal counsel probably advised Bitar, Lederer, Ferguson, et al. of the “risks” involved in staying in the U.S market and they judged those risks as being acceptable. Other companies who were serving the U.S. market at that time, (most notably Party Poker/Party Gaming), made the decision to get out. It is my understanding that you were working at Party Poker on the day the plug was pulled on the U.S. market.

    I’ve always been curious as to why one company (Party Poker) decided to get out while two other companies (Pokerstars and Full Tilt) decided to risk it? In separate interviews, I have heard Mike Sexton intimate (more than once) that he believes Party’s decision to withdraw has now been vindicated and they will have a strong argument for gaining reentry back into the U.S. market once internet poker is legalized here in the U.S.

    Rich Garber, who just happens to be a lawyer, was a high-ranking Party Poker executive at the time the decision was made to withdraw. Did Mr. Garber tell his staff that something like this was likely to happen to Pokerstars and Full Tilt and it was just a matter of time?

46. One more thing, in order to answer the giant “EVIL?” question by working your way backwards logically, you have to start at they ended up doing something EVIL.

    You seem to have started from “they became insolvent”, how could you ever answer the evil question from that starting point?

    Only a complete idiot could work their way backwards from insolvent and determine they must have been evil, so of course your blog never reaches that determination.

    false premise * good logic = good, logical sounding false assumption

47. The reason you failed, in your effort to figure out how otherwise decent people could do something so vile, is that you negated to account for fear.

    Fear can turn a choir boy into a murderer as it fuels the human ability to rationalize. These guys were scared to death that they were going to lose their mansions and lifestyles if a BF ever occurred.

    They rationalized themselves as victims. They should already have millions in their accounts if not fo the UIGEA preventing them to go public.

    So they began to rationalize a strategy to get the equity they deserved without being able to sell the company.

    Easy, since a large portion of every deposit is mathematically destined to become theirs, all they had to do was take what was rightfully theirs before the DOJ stole it.

    They weren’t after ‘market share’, they were after deposits. And they worked out a formula by which it didn’t matter if some of the deposits didn’t clear.

    That would be the DOJ’s problem if a BF ever occurred, the money is still on the books after all, it’s not our fault most of it is frozen by the DOJ and the rest the DOJ won’t let us collect.

    You’re right, these guys are only human, but you underestimate how horrible human beings can behave.

48. B”y your broad definition, a bank is a Ponzi scheme since they don’t have enough cash on hand to cover deposits. ”

    Now a bank may not have the cash on hand, but that money is there, in actual investments, not imaginary like the money on full tilt was. BIG DIFFERENCE

    If a bank were to operate in the manner that FTP did, then it is Ponzi scheme type situation, and Federal regulators step in.

    Again, as I stated before, this is all semantics, just arguing over how you define Ponzi scheme. The fact is this . . . . Pokerstars made good to their US players and were able to continue on, while Full Tilt screwed EVERYONE.

    If it’s not criminal what they have done, then it damn sure should be. Intentions have little to do with anything, what they did was GAMBLE with other people’s money and lost, big time.

    Nobody should defend them, they should be forced to liquidate and be gone. Period

49. @Robert: Except for the pesky fact that online poker is illegal in some states. Washington being the most obvious because they specifically banned it. And when did PS and FTP finally pull out of Washington? 2010 after exhausting the legal process to the state supreme court where their arguments fell of deaf ears.

    Also, the WTO does not open the doors for any sort of activity. You’ve lumped in everything from horse racing to the stock market but that’s not how the WTO or the laws work. If online poker was legal in the US then there is a WTO issue if foreign operators are barred entry. But just because horse racing is allowed does not give poker an automatic green light to be included.

    Furthermore, France and Italy (and presumably Germany and Spain in the future) have set up a restrictive gaming environment that does seem to pass WTO scrutiny. You cannot just start offering online gaming in France without a French license to operate. Again, AFAIK no online poker company has ever even applied for a gaming license in the US.

    Lastly, the UIGEA was worded so that any violation of a state law constituted a violation of federal law. The fact that FTP and PS continued to engage in online gaming in Washington state despite a law which specifically prohibits online gaming officially made what they were doing a federal issue.

50. Concerning the legal status of online poker in the US…

    Trade agreements have a lot to do with the legal status of PS and FTP operating in the US. Under WTO obligations, the US does not have the right to ban foreign competitors from operating in the US, if these competitors are engaged in activity that is legal in the US. Since various types of gambling such as horse race wagering, lotteries, fantasy sports (not to mention stock and futures markets) are conducted via the internet within the US legally, why should FTP/PS assume their activities were illegal?

    Your analogy of tax evasion being prosecuted fails in this case, as no online poker company had ever been prosecuted for offering online poker games in the US.

51. More importantly, it was a key decision because those who stayed in the US did so knowing they were breaking the law. They were publicly declaring that profits were more important than ethics.

    Breaking the law does not necessarily mean acting unethically. IMO, FTP made the correct ethical decision in continuing to serve the US market.

52. @curtsea: By your broad definition, a bank is a Ponzi scheme since they don’t have enough cash on hand to cover deposits. That’s why I don’t think Ponzi is the right term. It’s a totally different sort of crime.

    What they did was criminal but it wasn’t a Ponzi scheme.

    And it’s not a given that they would have had to stop paying themselves. Let me lay out a hypothetical scenario for you (these numbers are not meant to mirror the real ones. it’s just an example of how you can do it).

    FTP is raking approx. $400 million per year gross and they clear $112 (28% margin). And let’s say that FTP believes that the long term effect of capturing 10% market share from PS because they’ve quit processing payments they can’t collect is about $40 million per year (gross).

    Now let’s say that they think they can capture this extra 10% from PS for less than what it would cost them via regular marketing. Let’s say that it would have cost them $30 million in marketing but they expect to only lose $10 million in bad loans.

    So they borrow money from the players to lend to other players who can’t get their money on PS and they anticipate that out of the $60 million they loan out that they’ll have to take $10 million of $11.2 million in extra profits in order to cover the bad loans that they can’t collect.

    So, on paper, they make $1.2 million (net) the first year and $11.2 million a year going forward by taking this bold action and everyone is made good. You still pay out X% of the total profits to shareholders and executives and nobody is the wiser.

    Now, the DOJ comes along and catches you with $60 million extended out in loans and cuts off your ability to ever get that money back. Plus they cut off 50% of your most profitable business.

    Instead of losing the expected $10 million, you’ve lost the entire $60 million and there’s no chance of ever making that money back. Plus you’ve got to pay back the $60 million immediately. But if you had $60 million laying around you wouldn’t have to borrow $60 million from the players so you’re screwed.

    The confusing part about a lot of this is that the DOJ is quoting total distributions for a 7 year period but the actual screw up only happened starting in Nov 2010. So while it looks like the owners have taken out $400 million and owe the players $300 million, the $300 million liability started well after much of that $400 million had already been paid out.

    Again, it’s all unethical at best and criminal at worst but it’s also not so black and white.

53. “But is that a Ponzi scheme?”

    No, it’s an Enron.

    “One of the first decisions you’re faced with is how to finance the loans. One option would be to cut the profit sharing distributions and scale back spending. But that would draw attention to Tilt’s flanking move. In order to keep Stars, the DOJ, and the players unaware of their scheme they had to keep operating business as usual.”

    Must keep investors and opposition from being aware of the true nature of profitability. Otherwise Enron wouldn’t have been able to expand and make even bigger profits for their investors.

    It’s a calculated business risk. There was no intent to steal the money.

    Yes for sure, they needed that money to expand and then it would have all been okay.

    “Well, for me, it’s like I told QuadJacks, I don’t think Howard Lederer, Chris Ferguson, Ray Bitar, and Rafe Furst are bad people.”

    Smartest guys in any poker room.

54. “Full Tilt was a little different in that they were using player money in order to generate additional revenue for FTP. Their hope was that this additional revenue would allow them to make the players who they borrowed from whole without them ever knowing.”

    In order for that to work, they would have to leave money they earned through rake in the accounts and use it to pay players, not themselves. Is that what they were doing? No sign of that according to the indictments, they were still paying themselves handsomely

    “A Ponzi scheme, by definition, is unsustainable. What Full Tilt did could have worked had BF never happened. As long as there was no run on the bank or a BF type event, at some point down the road players could be paid out everything they were owed.”

    The only way they could ever get money on hand back up to the level required to satisfy player accounts would be to stop paying themselves . . . .

55. I agree that it was never set up to be a “Ponzi scheme” and that lawyers are throwing that term around simply for effect. But that is really just a semantic argument going, arguing about terms and their definition, rather than getting to the substance.

    At no time did Full Tilt keep the players’ money separate from other funds, nor was cash on hand kept at levels equal to or exceeding the amount of money “in play”. This is operating in a sphere of unreasonable optimism, counting on perpetual growth to maintain operations, and as such, closely resembles a Ponzi scheme by definition.

    I don’t believe fraud and failure were the goals, but with the uncertainty of the US Government’s position on online poker, the anticipation of ever continuing growth was foolish at the very least.

56. @Lee: It’s more about the legal definition of a Ponzi scheme. In the case of Full Tilt they were loaning out money with the expectation of eventually making good to the borrowers. In a Ponzi scheme you’re taking money from Person A to make it appear that the value of Person B’s investment has increased in value.

    For instance, if I tell you that I can guarantee you a 20% return on your money and you give me $100,000. In a Ponzi scheme I either use your capital or the capital of other investors to give you $20,000 at the end of the year so you get your 20% return.

    Full Tilt was a little different in that they were using player money in order to generate additional revenue for FTP. Their hope was that this additional revenue would allow them to make the players who they borrowed from whole without them ever knowing.

    A Ponzi scheme, by definition, is unsustainable. What Full Tilt did could have worked had BF never happened. As long as there was no run on the bank or a BF type event, at some point down the road players could be paid out everything they were owed.

57. Bill,

    You write:

    “But is that a Ponzi scheme?

    Not really. It’s a calculated business risk. There was no intent to steal the money.

    But as we’ll soon see, when you start to compromise your ethics it becomes a slippery slope.
    One of the first decisions you’re faced with is how to finance the loans. One option would be to cut the profit sharing distributions and scale back spending. But that would draw attention to Tilt’s flanking move. In order to keep Stars, the DOJ, and the players unaware of their scheme they had to keep operating business as usual.

    If too many people found out that Tilt was floating the money to the players, players would begin to take advantage of it and make deposits without having the funds to back them up. No, this needed to be done in strict secrecy so that nobody was the wiser. Stars might even catch on and counter with their own loan program.

    That only leaves other player deposits to finance the loans. Again, I’m sure there’s a PowerPoint slide out there showing the historic deposit and withdrawal levels over the last several years indicating that Tilt could float a significant portion of player deposits without ever having to worry about cash flow issues.”

    Where I bolded – isn’t that exactly where this becomes a Ponzi scheme? Floating the loans from other players, thus requiring ever more players to sign up so that ever more loans can be floated. With the entire operation needing an ever broadening base of players to support those on top.

    Inevitably, Black Friday or not, such a “business plan” is going to collapse as soon as the base is no longer broad enough to support the top – which is always going to happen at some point. Just as in any Ponzi scheme.

    Please note that I’m not saying that there was ever an original intent to set up Full Tilt as a Ponzi scheme, or even an actual, conscious, decision to do so. But when the company started to gamble with the players’ money, and started making those loans – then it became one by default. Or am I missing something here?

    Lee

58. @guccee: I don’t have any advice other than what you’re probably reading elsewhere. Sorry.

59. @Wayne: Agreed. It would make for a good movie 🙂

60. @Fonzi: I think that’s what inspired this post. My experiences with Rafe are in such stark contrast to what he’s accused of that it’s hard to reconcile.

61. @Magnus: I do think AGCC is wrong in claiming they have no jurisdiction. This entire mess occurred under their jurisdiction and they now want to wash their hands the second they revoke the license. What about all of the complaints that happened while the AGCC was still the governing body?

    This whole thing is a mess for AGCC and I think they fear their legitimacy being questioned as a result of the FTP debacle taking place under their noses. Other countries or territories may be less willing to accept them as a legitimate regulatory body.

62. Hi Bill!

    Great post. Agree that it’s never just black or white.

    A question, sort of related:
    What is your take on AGCC trying to distance themselves from the whole mess?

    In their statement they said:
    “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.”

    In a strict sense I guess the statement is true. AGCC haven’t any jurisdiction over FTP anymore. But should AGCC get off the hook that easy?

    License revoked. Not our problem anymore.

    Cheers,

    /Magnus

63. @Shawn: I agree with you on what happened post-BF. But most of what happened post-BF was not criminal in nature. It’s amazingly poor form but haven’t most companies that are caught in some sort of scandal gone into lockdown mode?

    I’ve said, on this blog, that they should have communicated better with the customers but they only seem to make statements when someone says something about FTP or the owners that they don’t like.

64. I can sort of follow your thought process on the slippery slope idea but their behaviour since “Black Friday” is reprehensible. There are many people with families to support who have their entire bankroll on Full Tilt. When times were good, Howard, Chris et all raked in millions from the players but they’ve turned their backs on the players as soon as the trouble started. There has been complete silence. There has been no attempt to pay even a minimum of the money to the players. It takes a special kind of sociopath to sit there in silence while so many people are agonizing over their lost funds and uncertain future. The slope may have been slippery at first but it became greased lightning later. Lawyer or not, there comes a time in life when you have to stand up and be a man, and sadly that time for Howard is running out.

65. Yo Mr. Rini!
    To whom it may concern; 2 days before black friday the DOJ shutdown an international botnet called ” Coreflood ” could this have any bearing on why everyone involved in the poker industry can’t find who to blame. Everyone seems so innocent as you have pointed out. There are many things to consider but this trojan could explain some of the mystery around the allegations to date. The poker sites kept extensive records if they were doing any thing unethical that this would be telling on theirself. The facts and figures should be a major clue to get to the bottom of this subject. The truth shall be found then the pieces of the puzzle may fit to form a logical reasonable explaination.
    Do you have any take or spin on our options as players?

66. I totally agree with what you’re saying. I just can’t see the owners knowing about all these problems and letting them get as bad as they did. Also I worked with Rafe Furst on some Bad Beat on Cancer events and have always though of him as a do-gooder. I can’t see him being involved in something like this. the guy spends his life trying to help people, not screw them. There’s much to be played out here and the one question I’d love to have answered is how the accounts payable (uncollected funds) were shown to the board and the owners. If they were shown at all.

67. Hi Bill,
    I think your reasoning is sound. I am sure some of your specifics are off as you even admit too. People usually start small. As they get away with things, they get bolder/greedier and hopefully eventually get caught.

    Off course the story has not fully played out. I think a good book and/or movie could be made out of this.

68. Good article Bill!

    There’s an important business lesson here…. which is that cashflow is more important than profit.

69. @trisha: Poker is a game that has been played by everyone from US presidents to dad holding a home game in his basement. To call poker players hustlers, con men, and cheaters seems like a totally unfair comparison.

70. @CNG97: I guess I’m more biased than that since I worked with Ray and Howard, and know Chris and Rafe. But, I’m only biased in the sense that I’m willing to give people the benefit of the doubt until proven wrong. Believe me, I hold no sympathy for Ray as everything I’ve seen to date has him as the main architect of this disaster.

    So this has really just been an exercise in trying to figure out how it happened.

71. @Anon Y. Mouse, if the indictments are accurate then there was a conscious decision to continue taking money despite not having the capability to capture the funds. According to the indictment management felt this gave them an advantage over PS who accepted the fact that funds couldn’t be reliably processed.

    Besides, considering the amount of money floating out there, how incompetent was management not to notice they weren’t collecting the funds? Or if they did know and thought it would be resolved, at what point were they willing to cut their losses? According to both the DOJ as well as player accounts during the time period in question, this ran from Nov of 2010 through at least Jan or Feb or 2011.

    In terms of the bank thing, if I did read the complaint correctly then they money was ultimately supplied by PS and FTP and they had full knowledge of how the funds were being used. Same thing, essentially.

72. @curtinsea: I would like to see the final accounting when/if this ever comes to trial. The DOJ has thrown around some numbers but how accurate are they? Even if the company had only $60 million to cover $300 million in deposits, did they have the money but in illiquid assets?

    There’s a lot we don’t know yet. I’m open to amending my thoughts as more information becomes available but right now the information we do have is coming from a DOJ that characterized FTP as a Ponzi scheme despite the fact it doesn’t fit the definition of what a Ponzi scheme actually is.

73. I agree with your earlier statement that the malicious intent to rip off thousands of players doesn’t really fit the personalities of any of these people, HOWEVER, pro poker players/essentially professional gamblers are seriously lacking in any kind of responsible accountability in any “normal” business operation. Most are lazy and have found an easy way not to partake or contribute to life in any positive way. Their whole purpose is to take advantage of all the “fish” out there and “win” their money. Ironically, the gamblers all got burned by their own kind. Hustlers, cheaters, con men….I say the poker world as I’ve been introduced, and general public perception, is that its just a seedy element of society. No one really cares. So go crazy, hopefully keep the scamming within your own little world…and by the way nobody wants your regulated tax dollars. Hop into life…get an education…have some purpose….get a real job.

74. I like the analysis. The open minded part of the blog is somewhat biased in my opinion. You have worked with 1 or more of these people in the past. All I hope for is money to be returned and the good ole USA to legalize in someway, shape or form online poker. I was a regular at FTP for a couple years. I knew the risks as did the 99% of the rest of us in the USA. I took the risk and now my money is still in limbo…. Should have known after the first check I recieved from them bounced. I don’t lay blame on people to many times. The only blame right now is my own for taking the “risk”. I hope all is worked out and the USA and all other players get there money back. For me, I have written it off. If i get it back, great… if not… I wrote it off already. Good Luck to all!

75. “I’m paying you with your own money”.

    At least Teddy won that money first, it wasn’t “loaned” to him.

    What is being called “cash flow” is a horrible way for a gaming company to work (and hopefully the surviving sites take notice). While commingling was legal due to the rules of the AGCC, using player funds in ANY part of the company’s cash flow, breaks how gaming entities should model their accounting methods, if they were not meeting their overhead with the rake collection then an adjustment at that level (lowering overhead/raising rake) should have been done.

    I would think the collective of the people you mentioned would know that it’s not their money to begin with nor should it have been introduced to any part of the accounting cycle. All FTP is, is a house to distribute money to the winner of a hand/tournament, not an investment, not part of cash flow.

76. Unfortunately (or perhaps, Fortunately), I don’t subscribe to theory of a world that exists in black and white. Is Ted Bundy on the same level as a father who shoots the guy who raped his daughter and got off on a technicality?

    I can understand that people are angry. But that does not change facts. Just because it’s convenient to just write people off as greedy and incompetent does not uncover the truth behind what happened.

    I also understand that it’s easy to express feelings at people that you don’t actually know.

    What I was aiming for here was to try and think of what their logic and rationale would be behind their decisions. I still disagree with the decisions.

77. Totally agree with your slippery slope thesis.
    Points I’d add, ‘never attribute to malice what may be attributed to sheer incompetence’, and what about the alleged $300m the DoJ has frozen? Surely if that hadn’t happened they’d be a lot closer to solvent. Though shouldn’t have been any kind of surprise to them either.

78. First, a detail: “FTP … bought a piece of a struggling bank they could get to look the other way …” What is the basis for this claim? If you think it’s either the indictment or the DOJ civil complaint (original or amended), then read them again to see who allegedly “bought a piece”: it was Chad Elie et al, a payment processor.

    Regarding the “loans” (using your terminology) to players — the deposits that were mediated by processors but not completed by withdrawals from the players bank accounts: This was not a deliberate scheme; rather it was a problem, always seen as such, that spiraled out of control.

    I do give you a lot of credit for trying to be fair-minded, especially with respect to the board members who have been viciously pilloried by the DOJ and by players who have (thus far) been screwed.

    Unfortunately, this must be anonymous.

79. Well you covered all the bases, but it’s definitely making excuses and shifting the blame. I don’t believe that the “uncollected” deposits in any large measure are the cause of the collapse . . . . from the numbers being thrown around publicly they had in excess of $300m in play and only $60m on hand, with another $60m outstanding . . . . there is still a whole lot of money missing, and any run on the bank in the way of withdrawal requests spells doom.

    No, it’s a simple problem of not securing player funds and that is the sole responsibility of those writing the checks in FTP’s name.

80. Perhaps you should re-read the end of the article. You claim not to be apologizing for them, yet are basically implying that they are misunderstood. Unlike in a fallout of an interpersonal relationship, the underlying meaning or intentions of the anti-heroes are completely moot. They did wrong by us through unbelievable amount greed and negligence and have destroyed a lot of people’s lives as a result, to the tune of hundreds of millions of dollars. If this doesn’t make them bad people, then where do you set the bar?

81. @Lorin: I agree which is why I didn’t say that I was trying to paint them good or bad. I was just trying to figure out why it happened. Assuming people are evil is too easy. Trying to figure out what they were thinking does make the whole thing more human and easy to understand.

82. Good article and good analysis, but I have a problem with this: a criminal is defined by his actions, not his intentions. After all, there are few people who outright consider themselves “bad people”. In fact, many people who steal things don’t believe themselves to be thieves, and like Lederer et al, plan on paying it back, even though their circumstances dictate that is extremely unlikely, especially after sliding down the slippery slope.

    When it all comes down to the wire, I don’t care who these guys were before. They broke numerous laws and violated our collective trust on a massive scale, and deserve to go prison.

    They are criminals.

    As it stands, I am sure they will go down as a just a few more “innocent” guys in Shawshank…

83. You have of course completely missed the mark. By the very writing of this post, you are *still* attempting very directly to apologize for full tilt and make what these assholes did less bad, and merely stating in your post that you’re not trying to apologize for full tilt unfortunately does nothing to change the nature of the post.

    Bottom line: I don’t think mostly anybody thinks these guys “set out” to steal money from their players. I think everyone understood almost immediately when this happened — including the NY attorney general, by the way — that the full tilt founders did not create the site some years ago as a way to steal players’ money, but rather that they started off offering a real online poker solution in the U.S., and they proceeded to just make a bunch of bad / wrong decisions along the way as the regulatory and legality issues were constantly in flux. I think that all is kind of understood in this scenario from the beginning, and the point of your post that this was not Howard’s and Chris’s orignial intent does not provide some new, elucidating fact or interpretation that all of the people victimized by these thieves were not 100% aware of before you wrote it.

    But the very act of doing a post where the whole point is to point out the very obvious and widely-known fact that these people are “good guy” types and would never do something so against their own players’ interests? That makes you an accomplice as far as I am concerned. For someone who ambiguously mentions responsibility on the part of the poker media — a clearly guilty group along with many others in connection with this scandal — among those contributing to how this all happened, I am disappointed to see this post, which is *exactly* the type that makes the poker media responsible to some extent in the first place.

    Please, no more posts about how these thieves and conmen are “good guys” and would never do anything to harm their players intentionally. They are what they do, and the fact that they did not set out to steal from us in the first place doesn’t even *begin* to excuse, reduce or mitigate in any way their guilt, their criminality, or their complete lack of ethics or morals of any kind whatsoever.

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