More Full Tilt Disgust

Man I could ruminate on this full tilt business forever. This morning I have two quick thoughts I've been focusing on.

For starters, take a spin around the poker blogs you read these days, and you will still see a ton of people defending full tilt against the allegations that they were a ponzi scheme. I mean, I've seen or heard like five or six well known voices in the poker blogiverse saying that exact thing over the past 36 hours or so. Never mind the fact that, during the last year of its existence, full tilt operated at a massive shortfall in actual cash of some $130 million below the amount of funds in player accounts on their site, because the site was unable to find payment processors willing and able to transfer them the cash from depositors' accounts. They never told anyone this -- went out of their way to hide it in fact -- and spent the better part of their last year as an online poker site with again a 9-figure amount of "phantom funds" that were in play on full tilt's site, but which full tilt was never able to actually collect from its players' bank accounts. As a result, the last year consisted of full tilt funding player withdrawal requests out of other players' deposits (actually, out of what was left out of other players' deposits after the 19 owners and board members took their $5-10 million a month in distributions, that is), while only maintaining a small fraction of the total player poker funds available on the site in actual cash, resulting in the figures announced from Black Friday when full tilt had $390 million of player fund obligations, but only $60 million on hand with which to pay them. The whole thing was not designed as a ponzi scheme, no -- and the system has nothing to do with the traditional pyramid-style scheme that often many ponzi schemes take the form of -- but over the past year when funding player deposits became a huge challenge for tilt, the owners and those in control simply let those funding discrepancies linger, unnoticed and unannounced, and kept their business running in the hopes that no more than 15% or so of their players would make cashout requests at once which is all it would have taken for tilt not to be able to cover the withdrawals given the Black Friday figures. By June 2011 it would have taken just 2% of players to request withdrawals of their funds on full tilt for the company not to have had the money -- anywhere -- to pay their players out. This, my friends, is basically the textbook definition of a ponzi scheme, as asserted by US district attorney Preet Bharara in the amended complain filed earlier this week. And yet, I've read in several places in the poker media this week how it was wrong to use the term "ponzi scheme" to describe the site, that full tilt was just poorly-managed but not at all a ponzi scheme, that the district attorney is just trying to use the well-known and sensationalistic term in the media to gain the upper hand against the poor site being depicted falsely, etc.

Face it guys. Full tilt quickly became a way for the owners and founders to loot their players of our cash and live their extravagant lifestyles basically for free. But when things got out of control, the powers that be knowingly and willingly turned the site into a ginormous ponzi scheme scam, and when the events of April 15, 2011 caused massive withdrawal requests from U.S. players, the proverbial shit hit the fan and the jig was up, just like when Bernie Madoff could no longer meet his own fund's withdrawal requests and was forced to turn himself in. Pay withdrawals out of other people's deposits, and never actually have close to enough money to return everyone's investment near the end -- this is how ponzi schemes almost always end, and it's the essential nature of what makes them a ponzi scheme in the first place. But my question is: Is it seriously not time yet to stop defending these pieces of shit thieves just because you like to think of some of them as your friends? Stop posting that they're being mischaracterized (they aren't), stop posting that the district attorney is lying to get the media and the public on his side (he isn't), and stop saying that this was all just an innocent business enterprise gone wrong (it wasn't).

The other thing I just can't help thinking about these past several hours is the BBT. To be honest -- and frankly I wrote about this here a few times so this is no surprise to anybody -- but after those first couple of BBT series, I never really could understand how full tilt could willingly continue forking over 30 or 40 grand a pop for these BBT series, only to see the winners repeatedly pocketing the cash and not even playing in the WSOP with the winnings, or better yet, people taking the money and going out and playing, but then never blogging one whit about the experience in the first place. Several people commented on this over time on their blogs actually -- it just seemed odd that tilt would keep coming back and offering up more and more free prizes to us, when the BBT participants as a rule pretty much consistently fucked tilt off when tilt looked to get the benefit of their bargain by someone posting publicly about the experience that full tilt enabled them to win.

Well now we know how Full Tilt "had" the money to keep "spending" on "free" stuff for us in the various BBT tournament series, don't we? Full tilt "gave" us all this "free" stuff for the BBT series, over and over again, because in the end it was our money all along that they were just giving us back a small fraction of! I mean, when you're paying yourselves $443 million over a few years out of accounts into which players have deposited $390 million but which have only $60 million left as of Black Friday, what's $150,000 spread over four BBT series to help get a bunch of poker writers to write posts that are sure to bring at least some new players to the site, thereby generating more funds which the founders could pilfer for themselves? Why not give us the money and see how much we can generate in deposits? Since it was the deposits themselves that the full tilt owners were stealing -- and just not the rake from all the participants as we had all believed when the BBT series were going on -- what on earth would possibly make these people hesitate for a second in spending $150,000 of our money -- not theirs in any sense of the word -- on prizes for us, to try to generate more deposits to allow the company to keep its fraud going for just a little while longer. That $150,000 sure seemed like a huge amount of "free" "prizes" to be giving to little old us back in the day....Doesn't seem quite so large an amount anymore these days, does it?

Full Tilt Fully Sinking In

Wow. With a day to really absorb all the latest news from Wednesday's amended complaint by the New York attorney general in the online poker ban case that, among other things, adds Howard Lederer, Jesus Ferguson, Rafe Furst and Ray Bitar to the charges, it already feels like just an amazing revelation, one that is far and away the story in the history of online poker as we know it thus far.

Long story short, yknow that bunch of the biggest poker pros we all know and (used to) love from tv -- "the Professor", "Jesus", Phil Ivey and several others -- who started full tilt poker several years ago now? Well, guess what? Turns out they were actually literally stealing money out of your and my accounts -- yes, your and my money -- and paying it mostly to themselves over a several year period, while simultaneously running the entire poker site as a massive ponzi scheme. For real. I've seen some other bloggers arguing that ponzi is not really a fair description of what happened here, but I have to differ with that view, as I'll get to.

To provide some summary details for those not inclined to read all the various press reports about the amended complaint, or the new complaint itself (which you can read in full directly from the source right here, if you're interested), here's the basic gist, with quotes directly out of CNN.com's front page coverage of this story on Tuesday, with the emphasis and brackets mine:

"The prosecutor said that, as of March 31 [2011], Full Tilt Poker owed about $390 million to players around the world, including $150 million to U.S. players. But the company only had $60 million in bank accounts to pay them back.

Full Tilt paid more than $443 million in player funds to the board of directors and other owners, with $41 million going to Bitar, $42 million going to Lederer, and nearly $12 million going to another board member, Rafael Furst.

The company paid $25 million to Ferguson, and said that it owed him another $62 million, according to the prosecutor's office, noting that much of the money was transferred to Swiss and overseas accounts."

So that's the basic gist of what happened. Over the past few years, full tilt paid 19 owners and board members more than $443 million, including 42M to the Professor, 41M to Ray Bitar, 12M to Rafe Furst, and owing over $87 million to Jesus Ferguson, having only paid out some 25M of that amount thus far. Forbes also reported that "another owner, described by the feds as a professional poker player, received at least $40 million in distributions, as well as millions of dollars more characterized as loans from Full Tilt that have only been partially repaid." This statement obviously refers to Phil Ivey, so that's another 40M+ guy to add to the list of beneficiaries of cash payouts from full tilt over the past few years.

And I'd like to call attention to the two passages above that I highlighted in bold. First is the statement directly out of the amended complaint itself that much of the money from these full tilt owners and board members was transferred to Swiss and overseas accounts. Not that this surprises me per se, but there it is pretty much right there in black and white -- these guys knew on some level what they were doing was illegal, or at least that the funds might be subject so seizure and return at some point in the future. While "blithely" (to use Preet Bharara's excellent choice of words) and repeatedly assuring players in the U.S. and around the world that our funds were "totally safe and secure" on their site, the owners of the site were busy shipping their money the fuck out of the country, to Swiss bank accounts and other countries where they felt the U.S. would have the most difficulty recovering the funds when the shit inevitably hit the fan like it turns out these guys pretty much all knew it would.

And secondly, I just want to note that the Forbes coverage refers to the $4 million in loans we've all heard about to Phil Ivey not as loans but as amounts "characterized as loans", suggesting that there is some question as to whether even that was a fair description or whether what we're really looking at is just another example of someone stealing funds to support I'm sure an excessive and certainly excessively gamblerific lifestyle, with no intention of ever actually repaying that money.

I also wanted to take a minute to discuss what really turned this from your typical run-of-the-mill corporate raiding story and into a true life poker ponzi scheme, as the US attorney alleges in the amended complaint. Read this passage, also from the CNN coverage, describing full tilt's response when over the past year or so it became increasingly difficult for full tilt to actually find payment processors willing and able to withdraw the funds from its depositors' bank accounts:

"In order to maintain its false image of financial security, Full Tilt continued to credit player accounts without disclosing its inability to fund those credits," the prosecutor said. "When players gambled with these phantom funds and lost to other players, a massive shortfall developed."

So there you have it. This happened to me multiple times by the way, where I made a small deposit onto full tilt during the final year or so it was in operation, played with those funds for several days, and then at some point a week, two weeks, even a month or so later I was informed that my deposit was never deducted from my account (which I confirmed, of course) and thus my balance was deducted for the amount I never really deposited into the site. But what if I had already lost all of that money? Where did it go? Answer: (1) into other players' accounts, and (2) into the owners' and board members' pockets. Plain and simple, that's what happened. For the better part of a year, full tilt was having massive trouble actually getting the cash from players' bank accounts, and yet it still allowed those players to deposit "phantom funds" onto the sites, play with it, and either win (and presumably withdraw it into real cash) or lose (and thus transfer their losses to other players' accounts, who then presumably would look to withdraw it and turn it into real cash). I mean, you could not make this stuff up. Every time you saw Howard Lederer or Jesus Ferguson or Phil Ivey on tv over the past several months before the U.S. online poker ban in April of this year, they knew behind that face that they were literally operating at a shortfall in their own players' funds available on the site, allowing gambling of fake funds.

Note as well that the complaint alleges that "this scheme continued even after the original complaint was filed and the criminal indictment unsealed in April." Recall that the complaint alleges that, as of March 31 [2011], Full Tilt Poker owed about $390 million to players around the world, including $150 million to U.S. players. But the company only had $60 million in bank accounts to pay them back. As also reported by CNN, "As time went on, the poker site had even less money to pay its customers. By June [so this is less than three months later], Full Tilt owed $300 million to players around the world but only had $6 million to pay them, according to the prosecutor's office." So even after the online poker ban went down on April 15, the company continued to draw down on its meager cash available for depositors, owners, for everyone, raiding the company's last remaining cash that could have conceivably been used to return at least some fraction of player funds, from $60 million down to a mere $6 million, while player fund liabilities dropped only from $390 million to still $300 million owed. What a fucking disaster.

The Forbes coverage also has some good tidbits to help elucidate some of the details of this amazing, eye-opening story (again, emphasis mine):

"Federal prosecutors claim that Full Tilt’s board members got rich because the company used player funds to pay them massive amounts of money that largely was transferred to their accounts in Switzerland and other overseas locations. Specifically, the feds allege that Bitar pocketed $41 million and Lederer got $42 million. Jesus Ferguson allegedly was allocated $87 million in distributions and received at least $25 million, federal prosecutors claim. Another owner [Ivey obv], described by the feds as a professional poker player, received at least $40 million in distributions, as well as millions of dollars more characterized as loans from Full Tilt that have only been partially repaid. The government claims Full Tilt continued to make payments to its owners of up to $10 million per month even after the company was insolvent."

[Note that Tuesday's Wall Street Journal coverage pegged this number at $5 million per month paid to the full tilt owners starting as far back as April 2007.]

And later in the Forbes article:

U.S. government lawyers believe that Full Tilt Poker started to face a growing cash crunch in 2010 because it could not collect funds from U.S. players due to the federal government’s efforts to disrupt the payment processors that facilitate the flow of funds in the online poker industry. Indeed, Bharara’s office says that by August 2010 Full Tilt’s payment processing network had been severely disrupted and that the company could no longer withdraw money from U.S. players’ bank accounts. So instead, the feds claim, Full Tilt continued to credit player accounts without disclosing its inability to fund those credits, letting players make online poker bets with $130 million of “phantom funds” that resulted in a massive shortfall when other players won the bogus money in poker games.

The management of Full Tilt Poker, the feds say, “operated Full Tilt Poker with the hope that only a small number of players would try to withdraw funds at any one time, and that Full Tilt Poker would regularly receive additional deposits in amounts greater than any withdrawal requests.”,

Now if that last paragraph right up there ain't ponzi, then I don't know what is. For a period of several months, the owners and operators of full tilt poker intentionally, knowingly and willingly ran their company as a ponzi scheme, paying out those who withdrew funds from the site with the deposits of others, knowing all too well that the company was facing a potentially 9-figure shortfall in amounts deposited and in action on its site but which it could not collect and had no plan to be able to collect at any point in the future. And just like any good ponzi scheme, it was all premised on never more than a small percent of the site's users actually demanding their own money back at any given time. As long as those withdrawl requests were tiny in relative terms, having $60 million of cash on hand while supposedly "holding" $390 million of your customers' money worked out just fine. But when the shizzle hit the fizzle over the past year, there was never close to enough money to make the players whole. Oh, and meanwhile, the owners and directors paid themselves some $440 million out of those exact same corporate accounts that by April of this year contained only $60 million, and just $6 million by June.

Look, these guys raided your funds. My funds. Our money. It's like the CEOs of Tyco, Adelphia, and any other number of large company executives who have been busted over the past several years for using their company's funds to support a life of personal excess in almost every conceivable way. Only, this is much, much worse even than those examples. When the Tyco CEO took corporate funds to spend on expensive New York City call girls on business trips, at least he was taking funds that belonged to his company, and that were generated as revenues in exchange for his company's goods and services provided to customers. In this case, the full tilt guys took our money, not theirs and not full tilt's. This was not revenue in any sense of the word for full tilt. They were like a bank, merely holding on to our funds so that we could use them as we saw fit on their internet site. That's it. So while Dennis Koslowski and others in corporate America diverted money from their companies to fund ridiculous, extravagant lifestyles, in this case, Howard Lederer, Phil Ivey, Jesus Ferguson et al stole cash directly from their customers to fund similar endeavors. There's just no other way to spin it.

Oh, and by the way. I mentioned this briefly yesterday, but there seems to me to be a good chance that some of the crew of Lederer / Ferguson / Bitar / Ivey end up doing some jail time from all this, given the recent revelations. The corporate CEO's go to jail, and trust me when I say what they did is not close to as bad as what the full tilt owners are alleged by name to have done in this case. Why shouldn't these fucking pigs go to jail for a long time? Because they play a game as their professional jobs that's been frought with lying, cheating and dishonesty for the past couple hundred years? Because Howard Lederer came and blew smoke up the poker bloggers' asses at Caesars' poker room in Las Vegas at the summer WPBT gathering back in 2006, all the while he was literally stealing our very cash right out of our bank accounts and living high off the hog off of it? Seven or eight years ago, I most definitely idolized each one of Ivey, Lederer and Ferguson to some degree, without a doubt. Right now, make no mistake, I would bang the gavel myself and order them each to serve 30 years in the mutha fuckin slammer. And I probably wouldn't hesitate to cast them down with the sodomites either.

Unbelievable Full Tilt

Some of the details of the amended complaint are truly amazing, even given everything that has happened so far.

From Wicked Chops Poker (with my editorial commentary in blue font):

The Southern District of New York (SDNY) has amended its civil complaint against Full Tilt Poker, expanding the scope to include distribution payments to ownership totaling $443,860,529.89 and specifically naming Ray Bitar, Howard Lederer, Chris Ferguson, and Rafe Furst.

U.S. Attorney Preet Bharara went as far as to call Full Tilt Poker’s operations “…a massive Ponzi scheme against its own players.”

Bharara continued:

“Full Tilt was not a legitimate poker company, but a global Ponzi scheme. Full Tilt insiders lined their own pockets with funds picked from the pockets of their most loyal customers while blithely lying to both players and the public alike about the safety and security of the money deposited.” This pretty much says it all in a nutshell.

Key highlights from the complaint include:

■As of March 31, 2011, Tilt owed players from around the world over approximately $390,695,788 but had only approximately $59,579,413 in its bank accounts. (page 72)Yikes!
■Howard Lederer received approximately $37M in distributions as well as another $4M in profit sharing (page 72). What an asshole.
■Chris Ferguson received approximately $25M in distributions. (page 72)Asshole.
■Rafe Furst received approximately $11.7M. (page 73)Ass Hole!
■In all, it claims there are 19 owners of Full Tilt Poker. (page 73)
■An owner, named as “Player owner 1″ but clearly Phil Ivey, is alleged to have received at least $40M in distributions, “as well millions of dollars characterized as loans,” of which $4.4 million have not been repaid. (page 73)Perhaps the biggest asshole of the entire group, given how things have gone down.
■On that note, interestingly no other Full Tilt Poker owners where named in the amendment.
■Owners continued to receive approximately $10M/month even though beginning in the summer of 2010, management/the board of directors were aware of issues in collecting funds from U.S. players. (page 73) Assholes!
■Approximately $130M in U.S. player funds were never collected due to payment processing issues. (page 74)This is one of the most unbelievable statistics of the entire sordid full tilt affair, showing just how ineffectively run the company was. They had just $59 million in their accounts, and $395 million of players' funds, but failed to actually collect a staggering $130 million of that moneys. Unreal these clowns.
■The amendment claims that Tilt was “extremely insolvent” by March 2010, however owner distribution payments continued as late as April 1, 2011. (page 74)
■After 4/15, Tilt continued to accept funds although it had worldwide liabilities of over $300M. (page 75)Assholes.
■In an internal e-mail on June 12, 2011, Ray Bitar expressed concern that a company announcement regarding lay-offs and the Board (including himself) being replaced would be seen as bad news (which we find unbelievable–as most would’ve considered it great news), which in turn would cause a “new run on the bank,” adding that “it could be a huge run” and that “at this point we can’t even take a five million run.” (page 75)
■Any property, including money, used in [an illegal gambling business] may be
seized and forfeited to the United States–or better put–the accounts assets of Howard Lederer, Chris Ferguson, Ray Bitar, and Rafe Furst would be gonzo. (page 77)

We can only hope these pigs all go to jail for a long, long time. Which sounds to me like a very distinct and realistic possibility given the above.

Poker Media Still Sitting Quietly While Full Tilt Embarrasses Us All

Wow, what a bunch of masochists we all are. Seriously guys. Hasn't even one of you out there reading this wondered why exactly Phil Ivey -- the world's greatest poker player and perhaps greatest gambler -- "owes" full tilt $4 million? This is being widely reported by every major poker media outlet in the world, and has been for a good few months now as Ivey's alleged "White Knight" deal (which not coincidentally also involves the forgiving of Ivey's personal $4 million debt) is still said to be under negotiation to save the company in some form and -- hopefully -- to secure U.S. players the return of their funds that had been commingled into full tilt's own accounts. And yet, I keep waiting and waiting and waiting, and not one single person I can think of in the poker media has even questioned why, or how this could be. Pretty much all of them have lost their own money even on full tilt's site, and yet still, complete and total radio silence. The relationships, the history, and ultimately the downright adulation that these people still feel for all those poker pros you see on tv has blinded the media to providing any real coverage whatsoever of probably easily the worst scandal in the history of online poker. Sorry folks, but superuser doesn't even come close to stealing our money for their own and living high off the hog off of it. It's just not close.

Think about this. Phil Ivey is quite simply the single greatest poker player in the world today, I don't think many people would really dispute that fact at this point. The guy is a huge action junkie, he takes prop bets left and right, and he wins millions live and millions more online every year from this game. So, for starters, why does Ivey even need a $4 million loan from full tilt? And why did full tilt give him $4 million of their money, even assuming he did need it for something? Or, let me correct myself there -- why did full tilt give Phil Ivey $4 million of our money? And make no mistake -- that's exactly what commingling of players funds with full tilt funds means. They took the money we deposited with them, and then they just mixed our deposited funds in with all their money, using it for their own corporate purposes. Such as, apparently, "loaning" Phil Ivey $4 million.

Do you think Humberto Brenes ever owed pokerstars millions of dollars? What about Daniel Negreanu? How about UB, those scoundrels...d'ya think Phil Hellmuth owes UB $7 million or something? You think they lent Annie Duke a couple hundy large to complete an addition on to her house? Me thinks not.

And yet somehow, this that you are reading right here is the very first place to ever question or even mention the ludicrity of this $4 million debt from Ivey to full tilt. Somehow, I loaned Phil Ivey 4 million bucks even though I don't remember being asked about that decision, and I certainly know I didn't get to review any of his financial information or to sign off on his intended use of my funds. Last time I checked, I don't loan money to professional gamblers to throw on roshambo bouts, 18-foot puts on the greens, weight loss contests and WSOP bracelet bets against the rest of the best players in the world.

Or do I?

Along those same lines, I sat in silence for a good three weeks on this story as well, hoping against hope that at least one of these poker media outlets or bloggers would jump on this story with even a small fraction of the tenacity that was used to investigate and resolve the UB superuser scandal, but I simply cannot leave this post in "draft" mode any longer since it's obvious that, once again, the poker media is perfectly happy letting full tilt walk all over everyone, themselves included, because I guess they're just too busy staring agog like little schoolchildren at the very people who have stolen the cash right out of their pockets. But did anybody see the story a few weeks back when Todd Brunson tweeted that he had run into Howard Lederer in Las Vegas and that after telling Lederer how short he (Brunson) was on cash, Howard offered to pay Brunson what Brunson had locked up on Full Tilt at the time of the U.S. online poker ban? You're telling me the major poker media outlets never heard this story? Yeah right. Well, apparently it's true. Here are Todd Brunson's tweets of the events, which again happened just a few weeks ago on July 19 in Las Vegas:

"Look who I just ran into.. I told him the wsop killed me and I was cash short...... http://lockerz.com/s/121600156"
ToddBrunson

"He asked how much I had on tilt and I told him 150k.. He said come with me. We went to his car and he opened his trunk and paid me!!!!!!"

At first I figured this had to be a joke, especially given the complete dearth of coverage (let alone uproar) about it among the big poker sites. But nope, apparently it is all true -- the poker media is still just too busy planning how to blow the full tilt pros to spend any time letting you know that this happened. Brunson ran into Lederer in Vegas, took a picture to prove it, and when Brunson complained about being short on cash, Lederer apparently paid Brunson the $150,000 he had locked up on full tilt, right in cash out of the trunk of Lederer's car.

Now, putting aside the obvious questions on why on god's green earth Howard Lederer is driving around with more than 150 grand in his trunk (will somebody please carjack this asshole, PLEASE?!), wouldn't you think it would bother someone at wicked chops, at poker news, one of the big poker bloggers, anybody enough to mention that while little old you and me sit around waiting (forever?) to get (all? some of?) our money back that has been locked up at full tilt since April 15, the big dogs who know the founders of the site personally -- yes, those same founders who commingled your funds with their own -- are getting paid out by their friends the site's founders, in hundred-large chunks?

Wouldn't you think that it would have occurred to somebody in the media -- anybody at all -- to stop to think for a minute that maybe, if Lederer has $150k of full tilt funds sitting in his fucking car trunk that maybe, just maybe, that money could be disbursed to everyone whose money full tilt has stolen, and not just to the personal friends of the founders? Might one even suggest that this type of behavior by Lederer is more or less the exact same thing that got him into trouble in the first place, taking our poker deposit funds -- yours and mine -- and treating them like his own personal fucking ATM? I mean, can you imagine how many of us little people could have been paid out in full with just that $150,000 of my money and your money that Todd Brunson gratuitously got from Howard Lederer, just for happening to bump into him in a restaurant in Vegas?

I say again. Can you imagine if the posters on 2+2 were actually running with story like they did the UB mess a few years ago? Can you imagine if Haley was out there reporting on this complete and utter pile of bullshit every single day like she was back then with UB? Don't you wish Amy and Tim were glomming on to this story as surely as they did the WSOP missing chips scandal a couple of years back? And why aren't they? Why isn't anyone?

Seriously guys. WTF. It's getting very close to where we actually deserve what we get from full tilt here.

Woe Woe Woe is Full Tilt

For anyone who hasn't heard yet, Phil Ivey released a statement via facebook yesterday that is now right on his homepage for all to read, about the current situation going on at full tilt, a company in which Ivey is an investor. Without bothering to summarize everything (you can read the whole thing it at the link above, it is pretty short), suffice it to say that Ivey is disappointed and embarrassed that -- due to the "inactivity and indecision of others" -- full tilt has not yet paid out its U.S. players, which Ivey calls unacceptable and something for which he has filed suit against tiltware, the maker of the full tilt software, and that Ivey is not going to play the WSOP this year when others cannot due to failure of full tilt to return their funds. The most interesting part of the release to me is the last paragraph, where Ivey says, "I sincerely hope this statement will ignite those capable of resolving the problems into immediate action and would like to clarify that until a solution is reached that cements the security of all players, both US and International, I will, as I have for the last six weeks, dedicate the entirety of my time and efforts to finding a solution for those who have been wronged by the painfully slow process of repayment. It certainly sounds to me like Ivey is of the opinion that it is somehow someone's decision who is involved with the management of full tilt not to pay out the players. While I doubt that that is expressly true just as I wrote it there, something tells me that Ivey -- a clear insider with mostly everyone involved with full tilt management among the professional players' circuit -- knows a lot more than he is leading on here, and that he is directly and deliberately trying to send a strong message to one or more of his poker "friends" via this public announcement, since his private urgings do not seem to be working.

But the thing that has me much more pissed is the stone cold confirmation -- unfortunate though it is -- of literally every single thing I've said here about full tilt over the past month or so since it became obvious that player cashouts were not forthcoming from the U.S.'s formerly second-largest online poker site, coming out of ftpdoug on the 2+2 boards. For those who don't know (and I am no kind of 2+2 hound, but I've spent enough time there to know doug from various full tilt issues in the past, he is confirmed legit), ftpdoug works for full tilt and has appeared countless times in the forums -- and I think even here at my blog way back in the day after I ranted about full tilt intentionally pulling the plug on the servers on a night when they were going to have to pay out massive overlay across the board in their nighttime mtts -- to explain full tilt's position, give updates on status of corrections and problems, and just to generally disseminate information from full tilt to the masses.

Well, ftpdoug posted the following the other day on the 2+2 forums, and I'll just repost the whole thing here for those who have not yet seen it:

To our customers:

We acknowledge that our lack of communication reflects poorly on us, and rightfully so. We have been too optimistic in estimating how long it would take to sort through the issues we have faced since Black Friday. And as frustrating as the delays have been for us, we recognize that it cannot compare to the frustration you have been feeling.

We further recognize that our lack of communication has led to much speculation and many unsubstantiated rumors, which have often been contradictory. With this message, we hope to clear up as much confusion as we can, while at the same time keeping in mind the constraints imposed on us as a result of the cases brought in the Southern District of New York.

The most pressing questions:

1. When will the US players be paid?

We still do not have a specific timeframe for this. There has been, and remains, no bigger priority than getting US players paid as soon as possible, and we have been working around the clock to get this done.

2. Is FTP bankrupt?

No. FTP's worldwide business is healthy and, although we've had some short-term challenges, it is operating as normal.

From: http://www.gamblingcontrol.org/userf...2020110516.pdf

"The AGCC’s investigation into the affairs of it licensee Vantage Limited, trading as Full Tilt.com, is ongoing; initial investigations indicate no reason to believe that player fund transactions are fundamentally threatened by any consequence of the US authorities' actions. Delays caused by these actions are in the process of resolution, with normal service now being restored for non-US players. We understand that progress in respect of US player fund repatriation is anticipated and will be the subject of a separate statement from Full Tilt in due course. The Commission will remain engaged in this process."

3. What is the company doing to speed up payouts to the US players?

We are raising capital to ensure that the US players are paid out in full as quickly as possible.

It is important to remember that Full Tilt Poker has always paid out our players, even in the face of previous legal obstacles or factors not in our control, such as payment processor defaults and prior actions by the US government which resulted in US player funds being seized.

In all of these previous instances, Full Tilt Poker has covered these losses and intends to do the same again.

4. Why are the Full Tilt Pros remaining silent?

It is not their choice. But they are constrained by the pending legal actions.

As a final note, we understand -- and have always understood -- the effect that our brief statements have had not only on our customers, but also on our reputation. It has not been easy to stay silent and watch the damage being done to our company brand and personal reputations, but we need to be mindful of the complicated and serious legal issues raised in the pending cases.

The emphasis in blue is mine, not ftpdoug's, but it is those two highlighted portions which just smack me in the face most. So, for starters, for anyone who actually doubted that full tilt did not have the cash on hand to pay out the U.S. players, ftpdoug has now confirmed it. They have to raise capital in order to pay out the U.S. players. That's it, plain and simple. If you don't know, "raise capital" is a fancy way for saying "get money from someone". Period. They don't have sufficient funds on hand to pay out their U.S. fan base. I've said it for weeks, people have commented that I am overreacting, etc. Well, now you can't say that anymore.

And by the way, let's be clear about one thing. "We're raising capital" is exactly what Lehman Brothers CEO Dick Fuld said over and over and over for the month or two immediately prior to Lehman's declaration of bankruptcy. "We're raising capital" unfortunately means the same thing in this case as "We're hoping to raise capital", because full tilt does not yet have a deal in place, and again it is obvious at this point that they will not have the funds to pay out the U.S. players unless they do in fact raise that capital, by some accounts (admittedly this is pure rumor I believe) estimated to be as much as $150 million. Dick Fuld just needed 4 or 5 billion invested and said for weeks that he had several options to choose from. But then his U.S. competitors turned him down. Then Citi and Bank of America said no thanks. Eventually it was down to the Korean Investment Bank, who was apparently very close to agreeing to a deal but walked away at the 11th hour over issues over who would have control over the company after the investment. It's amazing, really, how quickly "We're raising capital" can become "We couldn't raise the necessary capital", especially when your underlying business model may be suspect to a lot of potential investors out there.

Will someone invest $150 million in full tilt, to give them enough money to pay their U.S. players, on the hopes that they can survive and provide a good return on that $150 million investment with the site's flagging presence outside the United States, and dim prospects of ever re-entering the lucrative U.S. market? Would you invest $150 million in that business? Maybe. They do have Rush Poker as others have pointed out, they do seem to have the majority of the biggest worldwide poker pros as sponsors (for now), and they have those multi-entry tournaments that no one else seems to have yet. So there is probably some intellectual property assets there worth a pretty penny. But if you think I think that them "raising capital" sufficient enough to pay out their U.S. players is a done deal, then you crazy.

And moreover, the way I see it, full tilt doesn't really think it's a done deal either, despite a lot of the rhetoric you see from the company to the contrary. I can't help but think that ftpdoug's use of the word "intend" where I highlighted it above instead of saying instead something like "and full tilt will do so in this case as well" I think says it all. Even in writing his comments, ftpdoug in my mind has some inside knowledge that the capital-raising talks are far from any actual commitments of funds, and to me his use of the word "intend" there stands out like a sore thumb. And I should mention as well that the company's recent response to Ivey -- essentially positioning Ivey as the reason why full tilt may be unable to secure new financing -- sounds exactly like what the beginning of the end would sound like to me, if that proves to be what this is.

I'm taking a stand here guys: I have officially flipped from the side of believing we would eventually get paid out by full tilt -- where I've been ever since the moment I read about the indictments and arrests of Black Friday -- and now I think it is probably slightly more likely than not that we do not get full payouts from the company. I referred to this a couple of weeks back, but something about a bunch of professional poker players being in charge of the company ultimately does not at all give me the sense that my best financial interests will be in the forefront at all times. Sure, Lederer's house may be for sale for $30 million right now, but like I said last week here, I guarantee you he wont' go through with it if (1) it's not enough to pay the U.S. players and save the company anyways, and (2) he's the only poker pro putting up his own money like that. And I'm not hearing anything else out of anyone affiliated with the site, or any poker pro for that matter, or now ftpdoug or the full tilt press releases, that lead me to believe they are any closer than I am right now to raising $150 million of fresh cash for their business.

Woe is Full Tilt

What the fruck is going on with Full Tilt and cashouts to U.S. players? And why aren't more people making more of a stink about it? Among our group anyways, it seems like it's basically TBA, a little bit of Josie, and then about a hundred quivering blobs of protoplasm too afraid (of something) to speak out against the site that has given us poker bloggers so much opportunity over the years to beef up our prize pools, let our group play rake-free, and even the (largely untaken) opportunity to play in the WSOP (yeah right).

Do any of you people really think that giving away a bunch of stuff to us over the years -- stuff which, believe you me, full tilt thought they were getting fair value for when they "gave it away" to us to begin with -- gives an online poker site the right to, or in any way absolves them from, commingle our U.S. player funds with the site's own funds, and now the consequent problems in giving us back our money? Can anyone really think that way? I've seen a few bloggers out there voicing that opinion, but as this cashout saga draws on and on and more and more details emerge about what is and is not happening at full tilt, is it possible that people really continue to just throw up their arms and give this site a pass?

Here's all I know: Pokerstars took what, ten days to get us our money? Less, even? They saw that they could no longer offer real-money play to U.S. players, and they basically immediately entered into a deal that would ensure the return in full of all U.S. players' funds, in conjunction with the U.S. government. This could only be done because pokerstars looked at their accounts and knew right away that they had segregated somewhere all the money they needed to cover all U.S. players' deposits somewhere in their coffers.

Now UB / Absolute, we like to think they are a different story. They're probably never returning any U.S. players' funds, and ultimately I think anyone who played at that site who expects them to do different now, simply is not in tune with the history of fraud and abuse at this company. Those funds are probably gone, and hopefully those of you who did play there anyways (like me) hedged against that risk by never leaving anything more than a few hundy on that site at any time. But guess what, guys? Full Tilt might be in that same boat as UB when it comes to returning your funds.

Yeah, I said it. And how much "free" stuff they "gave away" to bloggers over the past several years has precisely zero to do with it. What would that possibly have to do with whether or not full tilt is going to give players back their money? It doesn't. In fact, why should all the blogger "giveaways" over the years mean that we even give full tilt the benefit of the doubt at this point? Pokerstars got it done right away, because obviously they did not have player funds commingled with pokerstars funds. Full tilt, on the other hand, obviously did. And can anyone really feel secure when a bunch of professional poker players control an online poker site, and those players have just had the incredible cash cow that online poker is for most of their rolls, totally revoked, possibly forever but at least for a decently long, undetermined time to come, and when it turns out that that site now also had its own funds commingled with U.S. players' funds? Throw in what, tens (hundreds?) of millions of dollars that now needs to be returned and cashed out to U.S. players, and someone thinks I should give these funds-commingling scumbags the benefit of the doubt?

I have news for you rose-colored glass, all humanity is good, etc. people out there. Commingling our funds with the company's own funds -- that is, not actually having our cash separated on hand to pay us each back if and when we ever requested a cashout -- that already is the crime, as far as I'm concerned. Whether U.S. players end up getting all or most of their money back eventually, is almost secondary in my mind. The fact is that it turns out that the people who run full tilt have been running a kind of a modified ponzi scheme -- as long as people keep depositing, there are enough funds to go around for everyone to do what they want to do, but when they have to cash out all U.S. players in one fell swoop, guess what? They can't find the money for it all. And of course this is why the communications from full tilt have been so horrible (and so scarce) over the past couple of weeks, because they don't know how to explain this situation without admitting obvious guilt / fraud / etc. Think about it -- Pokerstars had the money, they knew they were going to be ok as a continuing business offering online poker only outside of the U.S., and they got their U.S. players their money back as quickly as humanly possible, and were very clear in their communications with respect to the situation. Full tilt, on the other hand, does not necessarily have the money to return to their U.S. players, and the long-term viability of their business is much more in doubt as full tilt was primarily focused on the U.S. market, and thus far it is just lie after lie, story after story, and excuse after excuse.

For any institution with access to individuals' finances to commingle its participants' funds with its own funds is punishable in almost any context and almost every circumstance. So no matter how this story ends up, Full tilt is already guilty in my mind. I am still proceeding on the assumption that I will one day see my $265 and change left on the site at the time of Black Friday, but I'm sure as hell not counting on it at this point. And with every passing day, the odds that we ever see that money dwindle further and further IMO.

Black D-Day Hate the Government Friday

That right there encompasses about 95% of the blog post titles I have seen coming out of anyone associated with our little corner of the internets over the past few days. Too many people have asked me in shock about my thoughts on this whole online poker mess, so I guess I'll bite the bullet and write a little bit about it here.

I have to say, the degree of shock out there about the events of last Friday is what is really shocking to me, much moreso than anything else involving the entire regulation of online poker in the U.S. I mean, what did you think the UIGEA meant, exactly, if not that at any time when the government decides to get off its ass, it can and will put a stop to these companies out there that are flagrantly violating this country's laws. This is not to say that the playing of online poker has been illegal by you and me over the past few years, but I do not and did not think at any point over the past few years now at least that the poker sites, and of course whatever methods they were using to transfer funds to and from my accounts to theirs, was anywhere even close to legal. And you know what?

Neither did you.

That's right, I said it. You knew since the moment the UIGEA was passed that it was no longer legal for any poker site to transfer funds to or from an account of a U.S.-based player. Oh, you might have blocked it out over time, or convinced yourself through the amazing power of denial that only the human brain is capable of, that the UIGEA had only been a farce, that it wasn't a "real law", or that somehow the lack of enforcement over the past few years meant that the government did not have any way or any desire to effectively enforce this particular statute. But unfortunately, that ain't the way the law works most of the time, and it turns out that wasn't what was happening here either. In fact, it appears from a quick read of the indictments that were handed out on Friday that the feds have actually -- and totally unsurprisingly -- been building their case against these guys going back to the time of passage of the UIGEA, and in some cases probably even earlier than that.

And let's not lose sight of those indictments here, either, by the way -- what these complaints allege is some pretty damn nasty behavior by the guys in charge at stars, full tilt and UB. I mean, without going into the boring details, this goes far beyond simply continuing to process financial transactions with U.S. players in violation of the UIGEA after it was passed. According to the indictments, these guys actually "bought" a few failing institutions in the wake of the financial crisis back in 2008 on the cheap -- in some cases for a $20 million or $30 million "investment" which saved the otherwise failing institution -- and then essentially kept these dying banks afloat, more or less expressly for the purpose of processing UIGEA-prohibited online poker funds transfers with U.S.-based players. I mean, think about that for a minute. These guys were having problems finding payment processors willing and able to give the middle finger to the U.S. government a few years ago in the wake of the UIGEA's passage, so what did they do? They created their own payment processors by "saving" banks that were otherwise about to fail, and then keeping them afloat for the primary purpose of effectuating their knowingly illegal transactions. That is some heavy duty shit right there, and my initial reaction is that, absent some more facts that I admittedly know nothing about, those allegations sound pretty damning to me, of the individuals involved, and of the poker sites in general who allowed such activities to be pursued in their names and in their interests.

So these guys sure sound guilty to me, and I can't really say that I am even a little bit surprised that there were illegal and/or dubious shenanigans going on at all times with these entities just to be able to have a constant way to thwart the authorities and the UIGEA for the better part of three or four years. And as I've said above, I don't really think anyone else out there for the most part thought this was all legal or legit either. We just didn't care. We, as a group, decided to take our chances. Sure, there were things we could do to help minimize the risk to us -- chief among them, never, ever ever keeping more than a small amount of funds on any online poker site at any time at any point ever again -- but ultimately, we were all taking a risk, one that we didn't just think might not be totally on the up-and-up, but one where we actually all knew beyond almost any shadow of a doubt that the principals involved were using shady and illegal means to circumvent the provisions of a law that every one of you out there reading this knew was passed just a few short years ago, and was aimed directly at this little online poker thing we all like to do from time to time.

I guess what I'm trying to say here is a couple of things. For starters, this day had to come. Had to. HAD TO. There was no way it wasn't ever going to come, and finally, this past weekend, it did. But there was in my mind already no way that we were just going to be able to keep on keepin' on, playing online poker, transferring money into and out of a system that itself pretty clearly violates the UIGEA, and where in fact as it turns out that the founders of such systems had deliberately spent money for the express purpose of acquiring the ability to violate the law in ongoing fashion, ad infinitum once the U.S. government passed a law specifically proscribing such activities. I laugh at anyone who says that poker is a game of skill and not "gambling" in some form -- the role of luck in this game, and probably even moreso in tournaments than in cash games, pretty much eliminates any ability in my book to possibly argue that the statute does not apply to online poker. So yeah, while others seem generally to be utterly shocked and appalled by what happened last Friday -- and many of you sound to be downright angry by the weekend's events, but don't count me among them. I am not surprised, this occurrence did not shock me in any way, and to the extent that there would be any anger on my part -- there isn't really -- that anger would have manifested itself three years ago upon the passage of the UIGEA. But there's no anger today, which just seems weird and misplaced to me. The online poker you've all been playing has been straight-up illegally run for the past three years, and there was never any doubt about that fact. Just because the government finally got around to enforcing this rule this week, that decision itself does not cause any increased anger coming from me. In a sick way, I actually support it. I mean, not having the freedom to decide to play online poker kinda sucks I guess, but once the government took the step of creating a law to prohibit such activities, I think not enforcing the laws we have on the books is pretty much the wrong answer for where our government should be.

One thing that I am utterly, hopelessly shocked about is the stories that are coming out of people having huge portions of their bankroll, their assets, or just generally large amounts of money in the U.S. locked up in the big online poker sites. It's been said elsewhere and there's no need to spend a lot of time working this up again here, but suffice it to say, I also can't find a lot of anger or sadness with respect to those people who are being affected by this weekend's big move by the DOJ. Did people learn nothing from the Neteller fiasco? I simply cannot even begin to fathom what goes into anyone in the U.S. making such a decision with respect to a big chunk of change. I've spoken to some people who argue that their specific account history on these sites enables them to, by not ever making a withdrawal to a specific address or account, retain some level of anonymity with respect to ever having engaged in online poker in the U.S. over the past few years, but ultimately I'm just not feeling that one, as anyone we know who the government really wanted to "prove" played online poker, I suppose they could do that pretty easily. And these sites already have your name, address and other information about you, so there's not really the kind of anonymity I think most people would like to think. And thirdly, I should mention, I see no reason at this point to be scared about the government trying to prosecute me, personally, for my actions with respect to online poker since the UIGEA was passed. So far as I can tell, the poker sites were flagrantly violating the UIGEA, and the financial institutions involved with them seem as if they were clearly in violation as well, but I still haven't seen anything to suggest that the act of playing online poker as a user over the past few years has been against the law. Anyways, all I'm trying to say here is that, not only do I feel a lack of surprise or pity for all those out there who got themselves into a situation where they are reliant on online poker for some major portion of their livelihood, but, try as I might, I just cannot find understanding of anyone who is now in a "Neteller II" situation with some big portion of their money or their poker bankroll now unable to be accessed, and I do not in any way think that those people somehow "got screwed" by the government. Those people might have screwed themselves at this point, but I can't pin that one on the government, as tempting as it might be. With all the work I have done to ensure that I have never, ever ever had more than a few hundy on any online poker site since the very moment that the government screwed us with the Neteller situation -- and most of you have no idea how difficult it has been to constantly be making tiny deposits and tiny withdrawals from the system for years on end for someone who plays the dollar volume that I have run through the major poker sites over the past few years -- anyone who chose to follow a different strategy, in my mind has done so at their own risk, and not a very informed or well thought-out risk at that.

One thing that occurred to me that I had to look into was how the big sites have had to completely change their guarantees on these mtts as a result of the huge drop in traffic stemming from this weekend's events. I don't recall what I saw on pokerstars, but for example I noted that the nightly 9:30pm ET 50-50 tournament which is so named because of its 50k guarantee to go along with just a $50 buyin, is now no longer the "50-50". Now it is simply "the 12.5k guaranteed". $12,500 guaranteed, from what used to be 50k guaranteed up to just a few days ago, and what managed to pull in over 200k in prizes during full tilt's recent "double guarantees" week, now down almost overnight to just 12.5k guaranteed. So that right there is a drop of roughly 75% in the guaranteed prize pools these sites are offering today, and I noted generally the same factor in most of full tilt's other tournaments. Suffice it to say, traffic at a site like full tilt has been absolutely devastated by the U.S. government actions. One thing I am very curious about is the upcoming FTOPS abillion that was scheduled to run this month -- I am wondering if those guarantees are staying the same as well? As of the other night, for example, the FTOPS Main Event was still listed on the poker client as $7.5 million guaranteed tournament as of right now. Hmmmmm. I know they have made this thing multi-entry, but 7.5M guaranteed? That's an awful lot of players for a 4pm ET tournament in a few weeks that cannot include any U.S.-based participants. Something tells me that full tilt's FTOPS guarantees are soon to fall as well, which will only further hurt the site that we as bloggers have come to love and use the most among the major online poker clients, but who probably stands to lose the most as well from the loss of U.S. players.

So I guess overall, it seems to me that my reaction to this whole business of the past weekend is far less severe, less concerned, and just generally less upset than most of the others I see out there. I think my objectivity and my certainty that this day would inevitably come from the moment the UIGEA was passed contributes to much of my ability to have this outlook on the online poker prohibition in the U.S., but I also think there is another aspect that also helps make this all seem much easier to handle to me -- online poker is a tremendous grind, if done correctly, and not one that is generally positive all the time, or even close to all the time. Frankly, as an mtt grinder, I have written here what, 8500 times over the past few years, about how frustrating this game is, about the ridiculous beat I took after running so deep and playing so well. How many times have I gone off on an insane rant because of some thoughtless play that some douchebag made against me and then got rewarded for? Or the unbelievable suckouts late in the game that knocked down my Tournament EV for a given mtt from 10k to just $800 or $1500 or something similarly undesirable to me. Or the unbelievable clown who cost me 8 grand by calling my preflop reraise with 75o and then flopping the stone nuts against my pocket Kings. Or the monkey-calling window lickers who chase at horribad pot odds at every flush they see or every inside straight they get. And what about all those late-tournament eliminations where I called down some loser with just his AK unimproved on the flop, only to see him nail his Ace on the river to steal thousands from right under my nose? Not even to mention all the KK into AA hands, all the dominating hands beaten repeatedly for huge pots allin preflop, all the stupid fucking bullshit that I and anyone who does what I do has run in to a million billion gillion times over over the past few years. Focusing on mtt's with rapidly increasing blinds and antes, as opposed to flat cash-game structures for the most part, only makes this frustration level all the worse, exponentially so I am sure, as people are constantly getting caught with their pants down, pushing in with short stacks and not even top pair to show for it.

I guess what I'm saying is, online poker hasn't exactly been all honky-dory for me as far as life experiences go. I mean, I've had some amazing, incredible life experiences that are sort of directly a result of my playing online poker, but those experiences -- going out for a trip to Vegas every year, trying to make a run at the WSOP, playing alongside all the pros I see on tv all the time every year -- I can continue to have whether or not I am permitted to log in to some obscure website hosted out of the Isle of Man in the evenings. But let's look at what other "benefits" online poker has brought me, that I am supposed to be so upset about it now being taken away from me by my government. It's been what, five or six years of constant heartache, annoyance, and anger. Repeated disappointment. Immeasurable frustration resulting from having so little absolute ability to control the outcome of my performance in these tournaments. And let's not forget, the countless hours -- literally, thousands, over the past few years -- of sitting in front of my laptop, all alone, late at night, hurting my back, getting out of shape, staying up too late, I could go on and on and on. Truth be told, I've gotten a lot out of playing online poker which is why I have continued to do so over the past several years -- mostly in the form of cash I have won, and the incredible feeling of personal achievement that comes only from a big poker tournament win that is really the reason why I play this game I think when it comes right down to it -- but the game as a whole, and its widespread availability to me thanks to the wonders of the internets, has brought along with those few positives about a thousand other negative outcomes for me along the way, ones that I have spent literally years writing about, venting about, and just generally going crazy with rage about, both in my blog, to my friends, and in the chatbox of just about every version of every poker client I've ever downloaded. And again, try as I might, I just can't feel very bad to have had what has been a generally annoying -- albeit profit-generating -- practice for me over several years now taken away from me. Yes, I made some money playing online poker to be sure, but at what cost? Becoming an angry, frustrating, bad beat-telling, jaded, pessimistic, out of shape, overtired night-owl loner? Choose me!

Something will probably come along sooner or later to replace the online poker options removed from all of us U.S. players a couple of days ago. Or maybe it won't.

Given the overall effect on my life from playing this game on the internet over the years, I just can't get all up in arms about this in any event. Online poker, you just weren't that good to me in the end.