There is really no reason to completely rehash all of the stuff about the Full Tilt debacle. Everyone knows MOST of the facts and are familiar with the proceedings. I feel I was privy to things lots of people weren’t because my best friend Jack Binion, was interested in buying FT and did a lot of Due diligence. I want to stress that anything I say isn’t written in stone and is just my opinion. This is America and everyone can believe what they want.
Was FT guilty of gross negligence and terrible mismanagement? Yes of course but what happened and why? It’s my understanding that an unknown person to the poker world Ray Bitar, was a very good friend to FT’s largest stock holder Chris Ferguson. Upon Fergusons recommendation Bitar was named CEO and put his name on all the documents, BANK accounts, different corporations, etc.
FT did an amazing job of advertising and marketing under the supervision of Bitar and Howard Lederer, Lederer held the position of President of FT and was very instrumental in helping FT’s remarkable growth. But remember, this was 2008 and Lederer retired from management after a year. Bitar remained in power and knew all of the inner workings of FT.
There was a board of directors, I’m not sure exactly who was on it but it was FT stockholders. The bottom line was they were poker players, not corporate executives. I can tell you for sure that poker players including myself are terrible business men. Why didn’t they step in and hire a top professional person to supervise and direct business? No one has ever answered that to my knowledge.
The site under Bitars directions started paying the stockholders huge dividends as the business grew. So the answer to the last question is that if you were a stockholder, would you question the management of a company that was sending you hundreds of thousands of dollars each month? I doubt you would, I know I wouldn’t, I’d think life is good!
Exactly how FT lost their cash is not clear to me. Something about processors, electronic checks they couldn’t cash, etc. They lost the WAY to get the money to the site. Bitar was in power and obviously made some bad decisions. He got into financial trouble and instead of telling his stockholders, thought that he could work his way out of the trouble. So, he continued sending out the large dividends to the people giving the illusion everything was alright. Bitar who is obviously a very smart guy might have worked things out but Black Friday happened and everything came to the surface.
Now the government froze all the bank accounts and took all available cash from the company. All of the stockholders said they knew nothing of the financial problems. I think most of them told the DOJ they had no knowledge of the condition of FT and the risk of perjury to a government agency would strongly suggest they ARE telling the truth.
Im not defending anyone nor am I wanting to persecute anyone. The question of how and why may never be explained to everyone’s satisfaction. It seems inconceivable that the board of directors or some of the major stockholders didn’t investigate the affairs of a billion dollar company. It looks like Bitar, Ferguson and Lederer are taking all the heat. Ferguson had a lot of faith in his friend Bitar. It is widely perceived that Howard Lederer was still heavily involved in running the company even though he retired two or three years earlier. I’ve been in contact with Lederer the last few months. When someone I’ve known for years, trusted and respected looks me dead in the eye and says he didn’t know about the financial problems, call me a big old Texas sucker because I will believe them. I have not talked to Ferguson but I understand he says what Lederer told me, that they didn’t know. There are at least 4 stockholders that own more of FT than Lederer. Where were they? The guilt should be shared IF its true Lederer and Ferguson didn’t know of the financial mess.
The main question I’ve had through all of this is where was the Chief Financial Officer? Even though I had nothing to do with the management when I was the spokesperson for the internet poker site Doylesroom, I know there was a strict CFO in place who made sure there was 110% of the players money in a separate account from the operating account. So when Doylesroom closed there was immediate cash available to pay the players. Why didn’t FT board of directors and stockholders realize THERE wasn’t any financial responsibility in the company?
Another unanswered question is where was the Aldernay Gaming Commission? They issued FT a license and for sure they had the responsibility to see that the players finds were secure. Before Doylesroom closed they were trying to get a license from Malta and in order to get approved by them, funds had to be in place to cover the players accounts.
I remember FT put out a statement to the effect that they are working on a deal to sell the company and pay the players their balances. That deal is still being pursued so what else is there to say? If you have never been involved with a FEDERAL investigation, you probably don’t understand. If you were looking at going to jail and your lawyers keep telling you to remain silent, would you say anything? When the government says “anything you say can and will be used against you”, it means exactly that. All of the Federal Agencies have proved it over and over. Regardless of what you say or don’t say. They are going to do a thorough and complete investigation. I believe the truth will finally come out when the DOJ signs off on the case.
I’m no lawyer but I remember from my college years the word intent was a very important word. If anyone thinks that FT was a “Global Ponzi Scheme”, they might want to buy some Oceanside property in KANSAS. FT was a huge success and paying the stockholders millions of dollars each month. Can any rational person think they destroyed all this by using unauthorized moneys? Of course not, so there was no intent of wrong doing for years. Then when all the money problems came about, the CEO of the company tried to salvage his mistake by continuing to pay the huge dividends. Ray Bitar for sure knew about the cover up and has to answer for his actions. You can believe or disbelieve the fact that Chris Ferguson and Howard Lederer knew about the problems. I know the majority of the poker world wants blood and believe they did know. I believe time will tell us the answer to that.
As far as I know, every member and stockholder of FT was my friend before Black Friday. Despite all the terrible mistakes and mismanagement I know the intent to defraud wasn’t part of their plan. Despite a LAW suit against FT by a major stockholder that killed potential sales, despite the fact they tried to salvage their company by continuing to operate outside the US, they are the same faces as before.
I don’t want to take a baseball bat and crush their grapes and I don’t want to keep them from rejoining the poker world. Where do you stop the level of responsibility? I don’t know, I only know all of the FT people were my friends and they still are.
I also recall I read in the most widely read book in the world where it says something like this, “Let someone with no guilt cast the first stone,”
May the flop be with you!