The third and fourth parts of the “Lederer Files” were released by Pokernews.com a little earlier today, with the interviewer Matthew Parvis quizzing Howard Lederer further on what exactly happened at Full Tilt Poker Prior to, during and after Black Friday.
Here is the synopsis of the exclusive Pokernews interview with Howard Lederer:
Part 3 – Deal With The Backlog Or Record TV Program? He chose TV Program!
The first discussion during part 3 of the Lederer files was about the backlog that had occurred at Full Tilt Poker regarding player deposits. An internal report released by the US Department Of Justice showed that there was in fact a shortfall of around $122 Million back in August 2010. This happened because all payment processors were unable to collect any funds from US player accounts.
Lederer himself stated that he had no knowledge of any report by claiming that it was a complete “mystery” to him. He also added that he was deeply upset that Full Tilt had even let a situation like backlogs to occur.
He was also asked about poker forums such as TwoPlusTwo where players had repeatedly created threads about not being paid their withdrawals from their Full Tilt Poker accounts. Lederer himself did admit that whilst at poker events he had been approached by a small number of players claiming they could not deposit funds or if they try to withdraw they did not receive any of their money.
At the time Lederer put the problems down to a supposed “glitch” in the system, with the thinking that there are millions of players on the site. He also starting to wonder just why there were not many more players kicking up a stir seeing as the numbers involved was of significant size.
Through further quizzing Lederer said that he was not informed of any backlog in player deposits until the 7th April 2011 where he was in fact told that the amount stood at over $100 million. He then claimed that the way he was told about it made it sound like the company was in fact okay and that the figure was in fact a lot bigger than that before and it was getting smaller.
He then made a statement that could really bite him in the behind in the future. Whilst he did admit that the issue of the backlog was of major concern, his schedule meant that he was supposed to go and take part on a USO tour with part of that being to record a poker program. His stance was that he needed to go on this trip and that he would come back on the 18th of April and deal with the backlog issue…Black Friday happened on the 15th!
The end of Part 3 moved on to the events that took place on Black Friday. Lederer claimed that he was informed by email, which explained that the first few hours of Black Friday meant that the company were frantically trying to come up with ways to block US players from playing, whilst trying to determine exactly what money had been seized and from what accounts.
He then told of himself being part of the Full Tilt press release on Black Friday, where he claimed that he really did completely believe that all player funds would be covered.
Part Four – The Shortfalls Coupled With The Uncooperative Members
Part four centered on what occurred immediately after Black Friday, specifically on how Full Tilt did in fact try and sell off the company. Lederer stated that by the time that the 21st April 2011 had come round they requested that all internal financial records were reviewed which led to the discovery that there was in fact a huge shortfall of $250 million. This shortfall was between what players had deposited and what money they actually had.
When quizzed further on whether or not he could quite believe the figures were correct, Lederer claimed that out of all of them it was the number regarding the effect of Black Friday would have on cash coverage that he found difficult to believe. Lederer then claimed that he was informed that from the $134 million player deposits that US players didn’t collect, it would be just $10 million that Full Tilt would be able to recover.
The conversation then switched to the first board meeting regarding the whole fiasco, with the main priority being how they were going to proceed from all of this. For the first time ever, board meetings which were usually conducted through conference calling had players sat alongside their attorneys; this was now the norm after Perry Friedman had his own one called in for this first meeting.
Lederer then claimed that relationships between the members became strained as it seemed that many were more interested in their own equities rather than that of repaying the millions that players on Full Tilt had lost. He then claimed he was actually booed off on one call, simply for reading out the terms of Benny Binions deal.
Throughout this whole process Lederer is trying to give a picture that he was one of the only ones trying to sort this out, without the help of most of the board. He then claimed that many of the board where quite happy that the company was still in fact making some money in May and that they were quite happy to try and wait this through.
Well there you have it, now we just have to anxiously wait for the next installments! What doesn’t put Lederer in a good light here is the fact that he chose a USO tour rather than trying to deal with a huge financial problem within the company. It also seems that the rumours have been true with regards to the board being more concerned about getting their own money back than that of their customers.