Earlier this week, federal prosecutors unveiled a civil lawsuit against online poker giant Full Tilt Poker, alleging it was "not a legitimate poker company, but a global Ponzi Scheme." Full Tilt is now offering a powerful defense: "Ehhh, technically what happened was not a Ponzi Scheme, per se."
The lawsuit, a byproduct of the feds' sweeping online poker crackdown, alleges that the company used $444 million in player funds to line the pockets of its own board members. By March, the lawsuit says, the company only had $60 million in funds to cover $360 million owed to players.
However, Full Tilt Poker wants you to know that whatever horrible things they may or may not have done with players' money it was not a Ponzi Scheme. A Full Tilt lawyer told the Times today:
"Even if, if a crime was committed, that doesn't make it a Ponzi scheme," he said, arguing that Full Tilt may have been mismanaged but was still an actual business. He said the term was not just wrong but "it's loaded, particularly post-Madoff."
According to Merriam Webster's dictionary a Ponzi Scheme is "an investment swindle in which some early investors are paid off with money put up by later ones in order to encourage more and bigger risks." Hm, Full Tilt sort of sounds like a Ponzi Scheme to us! Either either way, the tens of thousands of Full Tilt players whose money has probably vanished into thin air must be so happy to learn that they've been the victims of a different form of financial fuckery.
[Image via Jackace]