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Fully Tilted

Published by admin on April 29, 2025

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I knew that I would eventually have to get around to item that is the hottest poker news these days. Of course, I am talking about the debacle that has happened with Full Tilt Poker.

If you haven’t heard by now, the feds have levied charges against Full Tilt Poker claiming that they were acting in a Ponzi scheme. Attaching that name to something in the financial world is almost akin to a person being labeled a child molester. You just don’t want either associated with you.

Being called a Ponzi scheme effectively destroys the remaining credibility of the brand. If some entity purchases the remainder of the company, which was already in bankruptcy, they will certainly have to change the name and repackage the poker site as something else.

Here is what got Full Tilt into more trouble then just accepting American poker players:

The Past Year for Full Tilt

The major poker sites that have been allowing people in the U.S. to play at their poker rooms were dealt a blow this past April when many of them had their domain names confiscated. Most websites stopped accepting poker players from the U.S. A few have been able to skirt around this but the majority of online poker players in the U.S. have stopped playing entirely.

By this time, the damage was already done to Full Tilt Poker. They had already dug their own hole and the government came along and pushed them in. The reality was that Full Tilt was having a hard time getting payment from their players’ bank accounts.

So what did they do? Were they responsible and tell people that there would be a slight inconvenience while they found another way to get the money? No, they chose to do about the dumbest thing possible.

“I know, lets just tell the players that they made the deposit and give them the chips so we don’t slow down”, which is what I assume that someone said along the line. What could possibly go wrong?

“You mean putting imaginary money in with all of the real money? That’s sounds like a swell idea, let’s give ourselves giant bonuses”, which is what I assume that Rafe Furst, Chris Ferguson and Howard Lederer did. To be fair, they weren’t directly taking the money from the players’ accounts. The money that they gave themselves was from the rake and tournament fees that made Full Tilt more than profitable when they were able to receive money from players.

However, the decision to ever give players chips without getting their money is one of the most brain-dead moves ever. Here are the problems with that:

1) People aren’t stupid and they are greedy. I’m generalizing here. When some players saw that they could get free money, they took it. $100 here, $500 there, as long as you played at their tables for a while before you asked to cash out, you would get free money!

2) Your not a bank Full Tilt poker. Banks don’t have to have all the money they say that they do because if they run out, the banks get to ask the Federal Reserve to print them more. When you run out of money and you stated that you had millions more, that means you fail.

The government hit the accelerator by stopping the scheme in its tracks on April 15th this year. When they can no longer accept new players from the US, they instantly lost the money that was supposed to be taken from the players’ bank accounts at some point in time. That ended up accounting for more than $150 million in deposits that Full Tilt said that they took.

That would have been fine if the government didn’t also expect Full Tilt to pay players the money that they had in their accounts. Oops! We’re a “lottle” bit short. They weren’t expecting to have to pay everyone out at once. The “run on the bank” that happened exposed their dirty little secret. So they had to go into bankruptcy.

PokerStars got hit with the exact same sanctions and charges but they weren’t messing around with players’ money and paid everyone back. They are still one of the largest poker rooms.

In the end, this isn’t your classic Ponzi scheme. A Ponzi happens when someone manages other peoples money and returns dividends on profits that they didn’t make. Regardless of whether the individual was trying to legitimately make these profits or not, if you lie about the amount of money you have, it becomes a Ponzi scheme. Eventually, they grow large enough that the only way to keep them going is by continually getting new client money to pay out old clients.

What Full Tilt did was dilute the legitimacy of their games by introducing money that they did not collect. Once they crossed that line, there was no turning back.

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