Brunson, Greenstein Talk Full Tilt Poker Scandal

Doyle Brunson 7
“Poker players don’t make good businessmen," says Doyle Brunson.

With the poker world reeling from the addition of Howard Lederer and Chris Ferguson to the DOJ's civil complaint against Full Tilt Poker, many are confused by the discrepancy between their reputations and the allegations being laid against them.

And while the majority of the poker community bases their opinions on little more than what they see on television and read in the media, there are those who know the two FTP owners personally.

Doyle Brunson and Barry Greenstein can certainly be counted among the latter group.

“I’m extremely surprised because I’ve known Howard for years and years and I’ve always held him in very high regard,” Doyle Brunson told PokerListings.com on Day 1A of the 2011 EPT London main event.

“I always believed he was a very ethical person and I have to believe that he didn’t really know what was going on,” Brunson said.

In the amendment to the civil complaint against Full Tilt the DOJ asserts that Lederer received at least $41.8 million between April of 2007 and April of 2011. Ferguson is alleged to have received at least $25 million in the same time period.

The problem is that while the owners of Full Tilt Poker were receiving monthly dividends totaling $443 million over those four years, the company was for all intents and purposes insolvent in the time leading up to Black Friday.

Howard Lederer
The question is, how could intelligent people mismanage such a profitable company to the point of insolvency?
 

With player accounts totaling roughly $390 million in March of 2011, and FTP holding just $60 million in assets, the civil complaint claims that in an attempt to cover up the company’s dire financial straits, decisions were made to maintain the appearance that everything was business as usual.

Malicious Intent or a Misguided Attempt to Save the Site?

Poker legend Barry Greenstein has known Lederer and Ferguson for many years and has an idea about what may have led to their current quagmire.

“Let’s pick a name, Ray Bitar is usually the name people pick, didn’t want to alert anyone to the problems so to keep it on the down-low [dividend payments to owners] had to continue,” Greenstein told PokerListings.com.

“There’s no doubt in my mind that their thought wasn’t ‘We’re going to steal from customers’ but when Black Friday hit it came at the absolute worst time for them.”

Full Tilt Poker has since released statements pointing to a number of reasons for the company’s shortfall, including payment processor problems, government siezures and outright theft.

Compounding the problem, Full Tilt Poker was reportedly crediting players’ FTP accounts despite the funds never actually being withdrawn from the players’ bank accounts or credit cards, in efforts to keep the online poker room running smoothly.

Since the company would be unable to pay out any significant amount of player funds should they be requested, it was paramount to keep its insolvency under wraps. And that likely included keeping the information from owners of Full Tilt not in the know.

“Most of these guys on Team Full Tilt are friends of mine and most of them definitely didn’t know what was going on,” said Barry Greenstein.

“The big issue is when people found out what the problem was,” he added.

Barry Greenstein
Barry Greenstein seems to give Lederer and Ferguson the benefit of the doubt when it comes to their intentions.
 

So the continuing payments to the owners could be interpreted as being motivated by good intentions, to avoid a scare that might result in mass withdrawals while the online poker room was trying to rebuild its assets.

“I don’t think anyone believes that the initial intent was to defraud the customers, it just worked out that way in their method of fixing the problem,” Greenstein continued.

Brunson agrees that while their intentions may have been noble, there were serious mistakes made by FTP’s management.

“I know they didn’t have any checks and balances in place which is understandable to me as a gambler because every business I’ve ever been in I never made the right decisions.

“Poker players don’t make good businessmen,” he said simply.

Lack of Regulation in the US Partly to Blame

Another point Brunson and Greenstein agree on is that the US government, while not complicit in the mistakes made by Full Tilt Poker, definitely set the stage for something like this to happen.

By cracking down on off-shore online poker rooms with the UIGEA legislation, but never outlawing the activity of online poker, the US government created a grey area for its citizens putting their money in the hands of unregulated online poker rooms subject to little or no oversight.

“I don’t think the government should be blamed for Full Tilt’s mistakes but it set up a climate in which poker wasn’t regulated and the potential for bad things happening was there,” said Greenstein.

And as far-fetched as Full Tilt’s management, or lack thereof, seems, the US government’s failure to capitalize on the online poker industry is just as mind-boggling, especially considering the country’s economic state.

“Economically there’s money in online poker and we shouldn’t be shipping that money out to other countries that house online poker rooms that cater predominantly to American customers,” said Greenstein.

“The money needs to stay in America and we need to be employing Americans.”

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About Matthew Showell

Matt Showell was born and raised in the fair city of Vancouver, Canada. He now spends the bulk of his time traveling the globe, reporting on the world’s biggest poker tournaments. Matt has lived and breathed poker since the end of high school when he learned the most common variants at home games with his friends. In university he made his living playing low-stakes cash games and multi-table tournaments online while following the professional circuit on television and the Internet and in magazines.

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jason 2014-03-05 17:28:44

I dont understand how any of u didnt see this coming ive played poker for 20 years and ill tell u this i would never take part inva business built only by poker players. If howard was at a poker table tomorrow i would play him with the same respect i had for him at a poker table 10 years ago. on the other hand if he came to me and said hey i have a new business and we sell the best burgers in the world i would probubly just go to mcdonalds doyle is right poker players usually are not good business men

1934Coupe3Win 2012-09-14 05:16:38

Oh yea, Chris Ferguson "get a hair cut, the 60's ended 43 years ago" Freakshow! DOJ takem down they knew what was up. take all their money back and pay the people back.

1934Coupe3Win 2012-09-14 05:08:16

anyone can do the numbers, that alone should tell you that this kind of profit is not possible..... thats how madeoff was discovered... someone did the numbers and found it impossible to get that kind of % on your money... DUH Lederer being a math-a-magician knew that "money don't come that easy" don't need a PHD to figure that out

Dr.Donke 2012-08-14 14:10:20

Its fine to say that Howard and Jesus didnt do it purpose thats fine...but give back the money then. Whether they are Bernie Madoff or the CEOs of AIG I don't know. What I do know is that they are still scumbags who screwed a lot of people over. There is no defense or excuse for their actions.

Campster 2012-07-03 15:11:24

Either Chris Faggotson and Leadass are the most stupid human beings to ever help run a business, or, they're just plain old fraudulent parasitic thieving pigs. Pick your choice.

realist 2011-10-09 14:34:43

really Ken? Get a grip...greed is one of the most powerful motivators on earth...just ask 'Jesus"

kenisoneofthem 2011-10-08 17:10:02

Ken... your real name isnt howard lederer or chris ferguson is it?

Ken 2011-10-05 12:47:13

While there's no doubt that FTP was run very badly and perhaps even fraudulently in the end, their problems only surfaced as a result of the illegitimate harassment of the DOJ who caused the problem in the first place. The truth is, the UIGEA only applies in jurisdictions where online poker is illegal, which doesn't include any federal laws as well as almost all states. The DOH continued to rely on the legitimacy of the Wire Act which had been ruled inapplicable to online poker in federal court.

So in spite of this they seized players' money and also created a lot of processing difficulties, which in conjunction with FTP's stupid decision to credit players' accounts immediately with hundreds of millions not being able to be processed, along with the hundreds of millions seized prior to Black Friday and the hundreds of millions frozen afterward, led to all this.

So the people who are really to blame are the DOJ who in spite of their name don't need any law behind them and simply railroaded FTP into oblivion. When I read this story of the ponzi scheme accusations this really made me laugh, and this was perhaps the best spin I've ever seen on an issue. Sadly though most people believe their side of the story.

By the way, it's very clear that online poker, and online poker financial payment processing, still remains legal in almost every state, something no one is talking about. Once again though the law doesn't matter in all of this, it's just pure bullying by the U.S. government.

Jamesboden 2011-10-04 08:06:10

Poker degenerates defending other poker degenerates. Obviously too much time spent in windowless casinos has fuddled their brains.Poker players have no value of money - to those guys $440million may as well have been $100k its just online monopoly money for them. Wasn't Doyles Room allowing US players to play on their site when it was illegal? They all need some fresh air and a good wash!

realist 2011-10-03 22:17:34

This will and should continue to foster doubts about the integrity of online poker. It's sad that 'we the people' are duped yet again.
This will fuel anti-poker advocates everywhere. Thanks Howard.
"Jesus'.. now that name seems ironic

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