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Full Tilt Poker Payback Scheme is Ridiculous




An editorial from Hartley Henderson on how Full Tilt Poker players are getting repaid.

Editorial from Hartley Henderson:

In January the Garden City Group created a website devoted to the payback of American Full Tilt poker players called fulltiltpokerclaims.com. The site laid out all the information that almost every player already knew. Namely, the site told how the feds seized the Full Tilt Poker website on Black Friday; that the liquid assets at Full Tilt Poker were insufficient to pay back players; that the feds reached a deal with PokerStars to assume the assets and liabilities of Full Tilt Poker and in the process gave the necessary funds for the DoJ to pay back American players; and that Garden City Group was eventually hired by the DoJ to initiate payback the funds. What the site didn't tell and all that anyone cares about is when the funds will actually be available. The site says "soon" but considering former Full Tilt players have been told that for over a year now the indefinite payback date is hardly any consolation.

It should be noted that the site also tries to deflect any blame away from the DoJ and instead places it on the backs of Full Tilt management by suggesting they were fraudsters, ignoring the fact that until the seizures Full Tilt never once failed to pay any players and that much of Full Tilt's problems were due to seizures by the feds of Full Tilt payment processor's funds.

Yet while the creation of the website may be comforting to some former Full Tilt players what has to be sticking in their craw and what has many in the industry confused, myself included, is why Garden City Group had to be hired in the first place. When the DoJ seized all the information from Full Tilt, they had the complete client list including names, account numbers and balances owing.  So why couldn't the feds have put the funds back in players accounts (perhaps with the help of the Rational Group who now owns Full Tilt and PokerStars) and simply reopened the accounts for a few weeks to tell players to go in and submit a payment request by check which would then be sent off. Don't forget that is precisely what PokerStars and the DoJ agreed to shortly after the DoJ seized the website of PokerStars on Black Friday also. So why does this need to be any different? Better yet if they had the names, addresses and balances of account holders then why not simply send checks to those accounts without even going through the effort of "requesting a payment?"

For many customers this must have them reliving the days of NETeller when the DoJ seized funds in transit in early 2007 and then forced those customers to jump through hoops to get their funds back by filling out a form and requesting them from Navigant, a forensic accountant. The whole process was so conspicuous that many larger players never bothered to apply for repayment, instead opting to lose those funds and keep their names off a DoJ database and more importantly any list being maintained by the IRS, (particularly if they had over $10,000 in the account since Form TD F 90-22 requires proof to the IRS that funds over that amount were obtained legitimately). It's uncertain how many players at Full Tilt had more than $10,000 in their accounts but no doubt there are a few and having once again to request the funds through an agent of the DoJ must be making those large account holders feeling queasy and wondering if it's worth it.

Of course that could be precisely why the DoJ has chosen this method to get money back to players. If there is truly over $150 million owed to U.S. players (although there is some belief that many of the accounts were dummy accounts to make the books look better than they were), then even if 20% of players choose to forego their funds, which apparently is comparable to the number of NETeller players that never submitted claims for repayment, then that's over $30 million more in the Federal government's coffers.  The other possible reason for delay, of course, is to bide time for the 2014 mid term elections. If players start getting money back before the election, or close to Christmas, they may attribute it to the "good work" of the present government and may actually convert that to votes. Everyone feels great about the IRS and government when they get that refund check in the mail from the tax department even though it was really their own money all along.

It's good to know that Full Tilt customers may actually start getting repaid "soon" but it's unfortunate that the DoJ has used this method of forcing people to apply for their own money. Then again it just goes to show what was learned for many years now – when it comes to online gambling, the federal government seems to believe that any Americans who wagered offshore or are wagering offshore are somehow lowlifes that shouldn't be afforded the same rights as Americans who only wager at land-based casinos or on state lotteries  . . . despite the fact that there has never been anything on the books that makes it illegal for an American to wager offshore. Let's hope that every Full Tilt player gets every dime and that it happens in 2013 so we can finally close the door on Black Friday. I am not holding my breath.

Contact Hartley via email at hartley[at]osga[dot]com.

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