Feeds

Prosecutor calls poker site 'global Ponzi scheme'

Full Tilt poker accused of defrauding players of $330m

Beginner's guide to SSL certificates

Directors of one of the internet's biggest gambling sites have been accused of running a massive Ponzi scheme that bilked players out of about $330 million.

In court documents filed Tuesday, federal prosecutors accused those operating Full Tilt Poker of withdrawing more than $443 million from players' bank accounts and diverting it to board members and owners. Director Christopher Ferguson received more than $87 million, while his colleague Howard Lederer got $42 million, they said. Directors Raymond Bitar and Rafael Furst allegedly received $41 million and $11.7 million respectively.

In all, Full Tilt allegedly owed players around the world $390 million, but had only $60 million in its bank accounts, despite repeated assurance that money they deposited for online betting was stored in segregated accounts and belonged to each individual player.

“Full Tilt was not a legitimate poker company, but a global Ponzi scheme,” Preet Bharara US Attorney for New York's Southern District, said in a press release (PDF). “Not only did the firm orchestrate a massive fraud against the US banking system, as previously alleged, Full Tilt also cheated and abused its own players to the tune of hundreds of millions of dollars.”

Tuesday's allegations were contained in court filing that amended a civil complaint filed in April against operators of Full Tilt and two other online poker sites. The earlier action charged them with violating the Unlawful Internet Gambling Enforcement Act of 2006, which prohibits illicit gambling operations from accepting payments. The site was shut down in June.

The new allegations surfaced in the course of the investigation. In some cases, the alleged scheme continued even after the original complaint and an accompanying criminal indictment were unsealed. Prosecutors cited email sent in June in which Bitar worried about a “run on the bank” and admitted “at this point we can't even take a five million [dollar] run.” ®

Remote control for virtualized desktops

More from The Register

next story
You really need to do some tech support for Aunty Agnes
Free anti-virus software, expires, stops updating and p0wns the world
Regin: The super-spyware the security industry has been silent about
NSA fingered as likely source of complex malware family
You stupid BRICK! PCs running Avast AV can't handle Windows fixes
Fix issued, fingers pointed, forums in flames
Privacy bods offer GOV SPY VICTIMS a FREE SPYWARE SNIFFER
Looks for gov malware that evades most antivirus
Patch NOW! Microsoft slings emergency bug fix at Windows admins
Vulnerability promotes lusers to domain overlords ... oops
HACKERS can DELETE SURVEILLANCE DVRS remotely – report
Hikvision devices wide open to hacking, claim securobods
prev story

Whitepapers

Why and how to choose the right cloud vendor
The benefits of cloud-based storage in your processes. Eliminate onsite, disk-based backup and archiving in favor of cloud-based data protection.
Getting started with customer-focused identity management
Learn why identity is a fundamental requirement to digital growth, and how without it there is no way to identify and engage customers in a meaningful way.
Go beyond APM with real-time IT operations analytics
How IT operations teams can harness the wealth of wire data already flowing through their environment for real-time operational intelligence.
Why CIOs should rethink endpoint data protection in the age of mobility
Assessing trends in data protection, specifically with respect to mobile devices, BYOD, and remote employees.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.