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Sunday, June 9, 2024 | Back issues
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Poker Players Tell Full Tilt Execs to Ante Up

LAS VEGAS (CN) - After prosecutors shut down three leading gambling sites in a Ponzi scheme investigation last year, Full Tilt Poker executives denied "hundreds of thousands, if not millions" of players access to their own money, totaling $150 million, a class claims in Clark County Court.

Lead plaintiffs Steve Segal, Nick Hammer, Robin Houghdahl and Todd Terry are "'real-money' Internet poker players who held accounts with the Full Tilt Poker Internet gambling operation," but say their accounts were frozen on "Black Friday," as it is referred to by the online poker community.

On April 14, 2011, the feds seized the assets of the "Big Three" Internet poker companies in the United States: Full Tilt Poker, PokerStars and Absolute Poker. An ensuing civil suit against the companies accused executives and founders of money laundering.

Now Full Tilt players are taking aim at some of the same executives, filing suit Thursday against Full Tilt directors Howard Lederer and Chris "Jesus" Ferguson. The pair allegedly refused to refund players' deposits or to reimburse players for the dollar-value of their accounts.

The Justice Department said in a September 2011 lawsuit that Lederer and Ferguson "were utilizing the funds in the player accounts as their own personal checkbook, and that Full Tilt Poker was essentially a Ponzi scheme."

By intermingling players' accounts with operational funds, Lederer took home $42 million in distributions and authorized $443 million in distributions to other Full Tilt Poker owners, the players claim.

Ferguson allegedly received $85 million in distributions, and authorized $443 million in distributions to other owners.

"Lederer and Ferguson, by way of Full Tilt Poker, have effectively conceded their obligation to restore access to U.S. player accounts, stating: 'Please be assured that your funds are safe, and we thank you for your patience while we do everything in our power to have your money returned to you as soon as possible," according to the complaint.

Between 2006 and 2011, Full Tilt Poker was "one of the three largest online poker companies" until the Uniform Internet Gambling Enforcement Act of 2006 made it a federal crime for a business to accept most forms of payment in connection with gambling.

Though many online poker sites stopped operating in the United States, "Full Tilt did not," the lawsuit states.

Lederer and Ferguson "worked to evade these measures" and started creating "sham merchants and fake e-commerce Web sites and in doing so, lied to U.S. players, deceived U.S. banks, credit card and financial institutions," according to the complaint.

Doing so allowed them "to inequitably acquire with millions of dollars in illicit profits and funds in the player accounts," the lawsuit states. It also created "illegal avenues for the receipt of player funds, which led to criminal investigation, indictment of executives and seizure of assets of the Full Tilt Poker Umbrella's assets."

"In turn, the defendants have terminated player access to the player accounts and the players' funds therein despite the players' superior right to such funds and the permission and encouragement of the DOJ to return the funds to the players," the lawsuit states.

The players want their money back, along with damages, for conversion.

They are represented by Leonard H. Stone with Shook & Stone.

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