4 ms·

FTP's case is an exception due to the ridiculously large amounts that the owners and executives were paying out to themselves. Amounts significantly in excess o

FTP's case is an exception due to the ridiculously large amounts that the owners and executives were paying out to themselves. Amounts significantly in excess of the actual profits. Rake adds up quickly. If poker sites only carried enough money to cover player balances, they wouldn't suffer. Pokerstars is an example of a poker site that successfully paid out to players.

gojomo 15y ago
From my quick skim of the complaint, it appears that the problem wasn't just paying insiders amounts that were needed to cover player balances (which would be bad enough). Check out paragraph 113: 113. Beginning in or around August 2010, Full Tilt Poker was often unable to find payment processors to withdraw funds from the bank accounts of its United States players. Instead of disclosing this fact, Full Tilt Poker secretly began to credit funds to players’ online gambling accounts that Full Tilt Poker had never actually collected from players’ bank accounts. As players gambled, and lost, these phantom funds, Full Tilt Poker developed an undisclosed shortfall of approximately $130 million owed to players that Full Tilt Poker had never collected because, in reality, these funds were never withdrawn from players’ bank accounts. The management of Full Tilt Poker, including the FTP Insider Defendants, 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.
- shabble 15y ago
  If I'm understanding that right, it's essentially "We're using the rest of the world's players to give Americans (for whom this service is technically illegal) free money"? I'm glad I only ever played for matchsticks.
  - gojomo 15y ago
    Well, on a very small scale, under certain assumptions, extending credit in this manner might be a net win for the business. Legal casinos offer credit backed by their ability to collect through normal channels. Even offshore/illegal, if the amounts forwarded are small, and the users have shown a propensity to zero their debts after a while in order to deposit new funds without 'burning' their whole account/name, it could make sense here, too. (I didn't notice substantiation of the magnitude of these 'phantom balances'.) But atop the other allegations, and depending on the magnitude, it seems fishy... like a desperate move to give the insiders a bit more time to withdraw remaining funds or 'gamble for resurrection'.

gojomo 15y ago

From my quick skim of the complaint, it appears that the problem wasn't just paying insiders amounts that were needed to cover player balances (which would be bad enough). Check out paragraph 113: 113. Beginning in or around August 2010, Full Tilt Poker was often unable to find payment processors to withdraw funds from the bank accounts of its United States players. Instead of disclosing this fact, Full Tilt Poker secretly began to credit funds to players’ online gambling accounts that Full Tilt Poker had never actually collected from players’ bank accounts. As players gambled, and lost, these phantom funds, Full Tilt Poker developed an undisclosed shortfall of approximately $130 million owed to players that Full Tilt Poker had never collected because, in reality, these funds were never withdrawn from players’ bank accounts. The management of Full Tilt Poker, including the FTP Insider Defendants, 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.

shabble 15y ago
If I'm understanding that right, it's essentially "We're using the rest of the world's players to give Americans (for whom this service is technically illegal) free money"? I'm glad I only ever played for matchsticks.
- gojomo 15y ago
  Well, on a very small scale, under certain assumptions, extending credit in this manner might be a net win for the business. Legal casinos offer credit backed by their ability to collect through normal channels. Even offshore/illegal, if the amounts forwarded are small, and the users have shown a propensity to zero their debts after a while in order to deposit new funds without 'burning' their whole account/name, it could make sense here, too. (I didn't notice substantiation of the magnitude of these 'phantom balances'.) But atop the other allegations, and depending on the magnitude, it seems fishy... like a desperate move to give the insiders a bit more time to withdraw remaining funds or 'gamble for resurrection'.