Thanks but I think I will still read them for myself instead of taking your opinion about them , whoever you are, LOL

I wouldn't call it the same thing. I'll leave it at that but the differences should be obvious.

I'm sure Pocket Kings as a separate company was "shielded" from the dodgy stuff going down.

If they had more than 50 employees the same applies

What he probably means is that Pocket kings was just one company in the Full Tilt umbrella, it's very likely that somebody auditing Pocket Kings alone would only see a tiny portion of the picture and likely would not be able to realize there was a huge shortfall.

Two errors in less than one sentence. MBA must stand for Master of Bugger All.

Already handled ITT. See posts 47 and 80. But since we are being redundant ...

Pocket Kings Ltd., and Pocket Kings Consulting Ltd, were in Ireland. Pocket Kings Ltd. was large enought to exceed the threshold. It was audited by Grant Thornton, which is about as big as you can get without going Big Four. These audits did not turn up the problems because FTP was structured in such a way that Pocket Kings did not handle players' money.

Player money was handled by the licenced companies, Filco Ltd, Vantage Ltd. and Orininc Ltd., which were not in Ireland. They are Alderney companies. Alderney doesn't have any audit requirements, even, it seems, for companies holding client's money.

Perhaps it is only coincidence that Howard and Ray happened to structure FTP in such a manner that what was happening to player funds was hidden from public scrutiny and regulatory oversight.

It's starting to get nice and meaty now that the fourth installment has come out. The point of all that prologue has begun to emerge.

I am sure just a coincidence and not part of their long term and systematic plan to commit fraud.

I'm not sure HL's knowledge of the "backlog" accounts is as much of a smoking gun as DF seems to indicate. HL admits he heard stories. However, the real "shock" was that:

1: It was $100 million.
2: Ray and the CFO didn't account for it properly.

It is possible that HL thought that the "backlog" prior to that point was showing on the books as receivables, not cash.

Certainly, neither CF nor HL were financial people. It is also possible that RB threw the CFO under the bus on April 7. I can certainly seeing him telling them, "Look, I was just as in the dark as you were. It is going to take me a couple of weeks to knock heads and get the real answers. Let's meet on the 21st." Given all we've read about RB, he was certainly not going to admit guilt unless there was no other alternative. Since CF and RB were close friends, I can see CF accepting that statement and deciding that since he wouldn't add anything, he might as well head home for a couple of weeks.

To me, the real mystery which none of the interviews touched upon and DF hasn't addressed is HL's role in FTP from 9/08 to 4/11. HL's story is that he had no active role in the company and was as in the dark as any other owner. Yet at the same time, people routinely gossiped (culminating in Bluff Magazine calling him the most powerful person in poker) that he had a lot to do with FTP. HL's story is that the company was fine in 2008 and he only got back involved after all the damage was done. That is the contradiction that needs further explanation.

Excellent article diamond! Really enjoy it, and thankful you are able to share the real story of something that has effected so many, so much,

Braindead2000: The Lederer files. This is what happened.

I believe that most of the investors, Jesus and Howard were genuinely inept and weren't trying to actually rip people off or put people's money in jeopardy. Ray Bitar is to blame he was the head and he knew exactly what was going and didn't stop it.

Yeah, like others, I guess I've just had to re-calibrate my expectations for this series of articles. They're still somewhat interesting reads, but not the popcorn.gif stuff I guess I was expecting.

I was hoping for stuff in the vein of: "Howard said X, but I've got clear and convincing evidence that says Y, oh snap!" When instead, the tenor's more like "Well, Howard says X, but there's some evidence that that was an incomplete or misleading statement, as corroborated by other sources I have." In short, these articles don't paint Howard as a bald-faced liar. Just a greasy moving target who's hard to pin down. 2+2 desperately wants to catch Howard red-handed in a diabolical scheme to defraud players...when it's looking more and more like he was merely grossly negligent (possibly / hopefully criminally so). Horrible decisions were made that are offensive by every rational measure. I'm personally most disgusted by Howard's refusal to consider returning some of his $40M in distributions to keep the company afloat or help return players because (per the pokercast) he didn't want to take a loss on his Las Vegas investment properties. Nothing can justify that. But DF's series, to this point, hasn't provided the hand-in-the-cookie-jar moment it felt like she wants us to believe is there. Not yet, at least.

Many a drunk driver has made the same plea. They're still in jail. These two should be as well.

On a separate note, most interesting part of part-4 was:

Man: is it insane to ask about the plausibility of Ivey being broke at some point in the not-too-distant-future? Replace "Phil Ivey" with "Erick Lindgren" in the above passage, and people would be slack-jawed at the depths of degeneracy (and the brazenness of turning to FTP for a loan of that size.) Phil is, by most accounts, one of the most skilled players ever. He is also, by just as many accounts, a complete action junky / pit degen. With the FTP money tree no longer at his disposal...let's just say that going busto is in his range. I'm sure the preceding idea will be ridiculed by many; but begging for a $10M - $20M loan because a casino marker is due immediately...that's not indicative of sound money management.

The guy won't look broke for a while because morons will keep lending him money based on his skill and name. Only when people start losing hope that they will ever be paid will the stories start coming out. He was basically broke in april '11. He wanted 20m from ft. A few weeks later when they ask him to repay the 4m, he says that he'll have a buddy ship 500k. Never happened. People that think he's rolling in 10's of millions are lol. In the other thread, they're talking about how he crushes pit games.

I agree that they were inept, and even that they probably didn't set out to rip people off (this includes Bitar). However, when they started having problems (siezures and processing/backlog), I find it hard to believe that CF and HL genuinely didn't know anything until April 7th like HL claims. Diamond Flush claims to have sources that suggest HL knew about the situation months before April 7th. If this is true, it would explain Howard's relatively ambivalent attitude towards Ray - if Howard went too hard against Ray, he might fear Ray coming out and saying "I made Howard aware of the problems much earlier than April 7th" or something like that.

Obviously, unless an email or something that proves HL/CF knew prior to April 7th comes out, it's just speculation. Personally, I just find it much more plausible that HL did know much earlier than he says and he told Ray to continue operating as normal, hoping that they could fill the hole before anyone knew - and then Black Friday hit....

Good post

A few thoughts regarding HL from a longtime lurker...

Regarding HL and actions:

-Howard knows he is on the way out and suddenly decides the company needs a policy on cash coverage. Was he thinking about players or fortifying the Ray as fall-guy firewall?

-Imrich managed to get money beyond the 12 million in fees from the CF account and the DOJ did not know about it (but DF did,) and we know there were loans made to other members from this account. We also know that HL’s loan was actually a slush fund of sorts to move money off/on FTP. It seems possible/probable that HL and CF are owed money from players balances stuck on the site. Now that Stars is going to make these players whole, who gets that money?

-In the 2+2 interview it is pretty clear HL faced a real reckoning regarding letting RB’s salary continue. He felt he had no choice. He concedes that gambling with what was left of player money to try to get someone to pay off the players was his only option. Is paying someone a salary to go to jail for you legal?

-He used up the 60m or so that was left of the player money to keep the company going for a year, and he seems to admit in the 2+2 interview that this was against the advice of lawyers. Is that legal?

-Paypal left the US market in 2004. By the time HL stops day-to-day management the legal threats are very well known and very real. Howard already has a record for a gambling related charge. He clearly knew the risks. If his “baby” was a grey-market company and he wanted to shift the legal risk to someone who agreed to take the fall is there any scenario in which he would have allowed that person to be removed? Is that legal?

I honestly don't know the answers to these questions, but would very much like the input from the smart posters I have been reading for over a year now.

Regarding PI:

Specifically we know that:

” According to the agreement, if Phil Ivey stops receiving funds from Tiltware, Luciaetta Ivey’s alimony “will cease.” (http://www.lvrj.com/news/ex-wife-of-...135846023.html)

We know at this time:

-PI is trying to get out of the Tiltware “golden handcuffs” to generate income, presumably from another deal (but does not want to give up the shares.) If PI had voluntarily relinquished his FTP holding I would presume this would have posed problems for the divorce settlement.
-He wants a big loan.
-Whatever his motivation with the lawsuit it does not seem that FTP solvency was his primary goal.
-Is it legal to use an attorney you have paid for to structure alimony for your ex-wife to derive from a company whose interests you are actively trying to hurt?
-At what point can we say he has a very real -EV gambling problem? $1m sport bets at -110? Flying a private jet for one-hour losing craps sessions? A London casino holds your winnings when you do score because they are mad you did not gamble more?

And since I actually like PI, these questions:

-If he was under a non-disclosure that prevented him from telling the world that FTP was taking deposits in June '11 when it was insolvent what could he do to try to stop the company? Sue them and take away their best marketing asset?
-Once the AGCC does the dirty work and stops the deposits he then tries to then help the company by agreeing to Transition 2.0 etc?
-They are trying to blame HIM for the failure of the company when he brought in more deposits than everyone else combined?
-We are shocked that a guy who plays at his stakes had a lot of loans? What is the std dev of his bankroll if you include his craps play? Maybe get him in GA, but blame him for the demise of the company?

Regarding CF:

Cliffs on how to make 80 million as chairman of the board of a legally dubious company and protect yourself from legal risk and moral shame in the community.

-Put two friends together- A smart, smooth talking Pro with loads of connections and a guy willing to shoulder the legal risk.
-As you become aware/suspicious that customer funds are being looted, keep a low financial profile, claim you don't care about money and don't want dividends etc.
-Make sure that your two beards always stay front and center. One says what you want, the other does what you want.
-Stay silent
-Profit

Easy game

I remember hearing Chris talk about how he was amazed that poker players could be weaker at the maths than him and still so good (better?) Perhaps he learned the meta-game. Well played, sir.

I agree. However, the point at which you are on the BOARD of a company that cannot retain a competent CEO and CFO or even competent financial consulting because of legal concerns then it is fraud to reduce your personal risks without protecting the company and its source of revenue (customers.) DTM informs us that fraud is stealing.

I don't know if that is legal but I suspect we would agree that is a rip off?

It makes me wonder why Huck and Doyle would be so welcoming to someone who had had 150mil worth of unpaid "loans" to other poker players.

I guess they figure the Mayflower guys made the pokers boom so they are owed a solid? Or perhaps all is forgiven because Isai is paying the notes?

I think this is the key point. Howard seems to feel that he and the other owners have paid for their errors by losing the company and their cash cow, and now that PS got the company and will be paying people back, everything should be forgiven and forgotten.

In some twisted way he's right, but as someone posted earlier, at the very least he should wait till everyone has their money again. And of course, there's no way to compensate everyone for the damage that has been done to the game and the players.

Just like it's ok if someone steals your car but brings it back a month later with a full tank of gas?

Just because the money will eventually be returned doesn't make what happened any less wrong or less illegal.

I hope if I ever go to court, you're on the jury.