I first read this new statement over on Subject:Poker -- a good place to go to keep up with stories such as this particular one -- although if I’m not mistaken, the statement was initially sent to Nathan Vardi at Forbes.com, one of the financial site/magazine’s staffers who has been covering online poker-related issues and has reported several times on the situation at FTP and other Black Friday-related matters.
Seems kind of weird that Full Tilt Poker would send the statement to Forbes like that. Also seems weird that in his article Vardi didn’t initially pass along the entire statement -- not even 350 words long -- but only shared it in full after a commentator asked that he do so.
But then, you know, pretty much everything seems weird with regard to FTP.
The statement mostly looks back, not forward. And mostly casts blame on others for the dire straits presently being endured by those running Full Tilt Poker, not themselves.
Speaking of the past, the statement lists four items: (1) that during the two-year period leading up to Black Friday “U.S. government seized approximately $115M of player funds located in U.S. banks.”; (2) that “a key payment processor” -- Daniel Tzvetkoff (not named in the statement) -- “stole approximately $42M from Full Tilt Poker; (3) that at the end of 2010 and beginning of 2011 the site “experienced unprecedented issues with some of its third-party processors” that further added to its money problems; and (4) that “Full Tilt Poker never anticipated that the DOJ would proceed as it did by seizing our global domain name and shutting down the site worldwide.”
The latter item is the most odd-seeming of the bunch. In a few ways.
For one, as others have already noted, the first item regarding the seizure of funds seems a fairly strong indicator that the DOJ was no fan of what Full Tilt Poker was doing, and thus the events of April 15 were hardly to be regarded as something the site could not have anticipated. (The “issues” with processors might have been another clue that all was not going swimmingly as well.)
Also, while the domain was seized an agreement was reached within days between the DOJ and FTP (as well as PokerStars) for the domain to be returned in order to facilitate players cashing out. Furthermore, the “shutting down of the site worldwide” was not the DOJ’s doing. The site remained operating outside the U.S. for two-and-a-half months, only going offline after the Alderney Gambling Control Commission suspended its license to operate at the end of June.
But whatever. In fact, all of this talk about what has happened, how FTP didn’t see it coming, and how much blame FTP deserves is really beside the point. Most everyone right now is much more interested in what’s to come, not what’s already gone down.
The last paragraph does look forward a little, noting how FTP has been in talks with a half-dozen investor groups and has “engaged an additional financial advisor” to help them try to figure out how to achieve “an infusion of cash” that would enable them “to restore the site and repay players.”
Apparently we’ll be hearing a lot more from Full Tilt Poker, and soon. The Subject:Poker guys have contacts with some FTP folks, and they report that we should expect more statements from the site further detailing the causes for their current financial woes. This comes on the heels of the appearance of Jeff Ifrah, an attorney who had been representing FTP in one of those class action suits brought against the site, coming on just a few days ago over at Two Plus Two to answer questions.
In his posts Ifrah clarified that these talks with investors all involve the repayment of players -- that is, any deal that may happen whereby FTP does get bought and then subsequently run by others would necessarily entail current players getting their funds back. Ifrah also indicated that FTP was about to start issuing more statements and communicating more frequently regarding its status now that a “confidentiality agreement” with a potential investor group had finally expired.
Ifrah, meanwhile, after a few days of heavy posting over at 2+2 (more than 150 in four days), might be less actively involved in such discussions going forward, as Subject:Poker is reporting Ifrah and his law firm yesterday asked to step down from the case, stating that the firm couldn’t itself handle the “unreasonable financial burden” that would be required of them to continue representing FTP. (In other words, it sounds like Full Tilt can’t pay their lawyers.)
Those class action lawsuits, incidentally, will likely have some effect on what’s to come. Perhaps in these statements we are to anticipate coming from Full Tilt Poker those suits will be added to the list of things keeping FTP from getting that sought-after cash “infusion” and getting everyone paid back. Who knows?
What we do know is that more Full Tilt Poker chatter is likely on the way. I guess we’ll all just have to wait and see if anything else comes with.