US calls online poker site a ‘global Ponzi scheme’

NEW YORK (Reuters) – US prosecutors made new allegations yesterday in a probe of the Full Tilt Poker website, accusing self-styled “Poker Professor” Howard Lederer and professional poker champion Christopher Ferguson and others of paying themselves more than $440 million while defrauding other players.

In a motion filed in federal court in New York to amend an earlier civil complaint, the prosecutors accused Full Tilt Poker of running a Ponzi scheme that continued even after the original charges were filed.

Prosecutors unsealed the earlier charges on April 15, accusing three Internet poker companies — Full Tilt Poker, Absolute Poker and PokerStars — and 11 people, including Full Tilt director Raymond Bitar, of bank fraud, illegal gambling and money laundering offenses.

Lederer is described on his website (http://www.howardlederer.com) as “The Poker Professor” and Ferguson has won five World Series of Poker events. The men are directors and owners of Full Tilt Poker.

“In reality, Full Tilt Poker did not maintain funds sufficient to repay all players, and in addition, the company used player funds to pay board members and other owners more than $440 million since April 2007,” the office of Manhattan US Attorney Preet Bharara said in a statement.

“Full Tilt was not a legitimate poker company, but a global Ponzi scheme.”

A Ponzi scheme is usually one in which early investors are paid with the money of new clients and it collapses when funds run out.

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