Full Tilt Accused of Being a Ponzi Scheme

The Department of Justice amended its earlier complaint against Full Tilt Poker this week, charging that the company was running a “global Ponzi scheme” that defrauded millions of players out of millions of dollars.

“Full Tilt was not a legitimate poker company, but a global Ponzi scheme,” said Preet Bharara, U.S. Attorney from the Southern District of New York in a memorandum issued this week. “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.”

In indictments handed down on April 15, the government charged Full Tilt, PokerStars and Absolute Poker with money laundering and bank fraud changes. PokerStars immediately returned player funds and stopped accepting players from the U.S., while Full Tilt players in the U.S. couldn’t get their money returned to them.

According to the DOJ, the company had for some time funneled player money to several owners of the company and several of the company’s poker pros, including Howard Lederer and Chris “Jesus” Ferguson, who allegedly collected $42 million and $25 million, respectively, in allocations from the company.

According to the complaint, the company owed approximately $390 million to players worldwide by the end of March, including $150 million owed to American players. Yet, the complaint alleges, the company had less than $60 million in its bank accounts.

Upon hearing the news, John Pappas, the executive director of the Poker Players Alliance, issued a statement urging Congress to pass legislation that will regulate and oversee online poker.

“These new government allegations underscore the sincere need for Congress to act immediately to pass legislation that appropriately regulates internet poker in the U.S. so players can be protected from the types of abuses alleged by the Department of Justice today,” Pappas said in the statement. “Today’s news does not change the mission of the PPA – to make player reimbursements and effective federal or state licensing of internet poker a priority.”