Recently TonyG said on Quad Jack’s that the management team at Full Tilt Poker has to go. He said that Ray Bitar was the worst CEO in the industry. Actually he had far more racy words but suffice it to say that he doesn’t think too highly of how Ray Bitar has handled the Black Friday situation.
TonyG also lashed out at Phil Ivey. TonyG said that if FTP was worth $200 million a week ago it’s worth $30 million today (I think a bit of an exaggeration). He went back and forth between saying that Ivey is free to do what he wants and demonizing him for burning everyone.
Keep in mind that TonyG is one of the people getting burned. As owner of PokerNews he’s obviously got a lot invested in FTP being able to pay affiliates. That being said, he’s also sided with the players from day one and has been pressuring FTP management to resolve this issue.
I take a different view on this Ivey issue though. Though I’m not privy to the same information that TonyG is I’m seeing a completely different picture.
The reason players aren’t getting their funds back is because the company was mismanaged. I made a post earlier where I questioned FTP using the term “backlog” and since then I’ve gotten a ton of input from people who have told me they’ve made deposits on FTP going all the way back to Nov that has been credited to their FTP account but has never been debited from their bank account.
Let me say that again, the “backlog” is that FTP was crediting the player’s accounts and letting them play without ever debiting the player’s bank account.
5. By early 2011, Full Tilt Poker often could not find a payment processor to debit (or “pull”) funds from United States players’ checking accounts. However, rather than inform its players that payment processing was unavailable, Full Tilt Poker would routinely credit funds to players’ accounts at Full Tilt Poker even though it had no means to actually obtain the funds from the players’ bank accounts. For example, on approximately thirty separate occasions between January 14, 2011 and March 11, 2011, a cooperating witness (the “CW”) utilized Full Tilt Poker’s website to make deposits into his Full Tilt Poker account from a bank account in New York, New York. While Full Tilt promptly awarded the CW credit for the funds – allowing the CW to gamble with the money – Full Tilt Poker never actually debited the CW’s bank account. The inability to collect credited funds created a potential that Full Tilt Poker would not be able to pay out all customer accounts if asked to do so.
6. In or around about March 2011, another payment processor … (“CC-2”), contacted Bradley Franzen, the defendant, about Full Tilt Poker’s inability to obtain funds … CC-2 told FRANZEN that Full Tilt Poker had estimated that the “backlog” of credited funds was at least $60 million.
So if they had a backlog of deposits going all the way to Nov of last year . . . WTF?!? $60 million?? Who runs a company like this? Even without Black Friday and seizure of bank accounts how do you write this off? How was this sustainable?
The rumor mill (and this is just rumor) is that FTP has turned down at least one deal (and possibly two) that would have given them the money to pay back players because they would have lost control of the company. In an interview on One Outer (the interesting stuff starts about 50 minutes in) Barry Greenstein sort of alludes to this when talking about Ivey’s reasons for the lawsuit.
I’m not ready to paint Ivey one way or the other just yet but it’s obvious that regardless of his reasons or his intentions he’s basically screwed FTP’s abilities to put together a deal that keeps them in control of the company. And I don’t presume he did this specifically for the players. We all look out for ourselves and Phil is no different.
But at the end of the day, Phil Ivey wasn’t managing the business. He was a minority shareholder (allegedly) who was also a spokesman. And an unwilling spokesman at that. When I was at Tilt it was like pulling teeth to get him to photo shoots or sets because he was too busy playing poker. I’m fairly confident that he wasn’t aware of all of this stuff going on or any backlogs or any of the other stuff that Full Tilt is accused of. So, in that sense, he did not bring the company to the position it is in today. That was other people like Ray Bitar. So to point the finger at Ivey exclusively if he scuttled a deal that shouldn’t have needed to occur if the company had been managed better in the first place seems like an undue amount of blame.
But his public shot across the bow has definitely lowered FTP’s valuation. His move may have even scared off investors and/or seriously delayed people from getting paid back.
At the same time, what would you do if you were confronted with this level of mismanagement and the board, allegedly, walking away from deals that would have turned over control of the company to new owners but the players could be payed back immediately? I mean, even as a former employee I’m continually shocked at the news coming out so I can only imagine how Ivey must feel to realize how he’s been betrayed (if the rumors and the DOJ allegations are true).
In the beginning of this whole drama I was 100% sure FTP players would get paid out. As things have evolved I’ve remained confident but the certainty has dropped a little. Now with this out there, I’m starting to worry. I still think the odds are better than 50/50 but it’s more like 60/40 or 70/30.