Feds: Top Poker Pros Scored In “Ponzi Scheme”

SEPTEMBER 20--The Department of Justice today accused three high-profile professional poker players of reaping financial windfalls from an online poker firm that allegedly operated as a “global Ponzi scheme.”

In an amended civil complaint filed in U.S. District Court, federal prosecutors in New York accused Howard Lederer, Chris “Jesus” Ferguson, and Rafael Furst of improperly banking tens of millions of dollars via their positions as board members of Full Tilt Poker. Prosecutors allege that the trio--and other Full Tilt board members and owners--received eight-figure payouts at a time when the firm did not have sufficient funds to cover what was owed to its online players.

According to the complaint (excerpted here), Full Tilt distributed a whopping $443.8 million to board members and owners over a four-year period ending in April, the month prosecutors brought criminal charges against Full Tilt founder Raymond Bitar and 10 other defendants, including the founders of online sites PokerStars and Absolute Poker.

Lederer, Ferguson, and Furst (pictured above, left to right) were named today as defendants in the civil suit filed in U.S. District Court in Manhattan. The complaint alleges that:

* Lederer received about $42 million from Full Tilt, with some of the funds being deposited in an Lloyds TSB account in the Isle of Man. Lederer, who bills himself as the “Poker Professor,” is the brother of pro player Annie Duke.

* About $25 million was transferred to Ferguson’s personal bank accounts. He was also allocated another $60 million, which was listed in Full Tilt records as being “owed” to Ferguson, whose nickname arises from his thin frame, beard, and shoulder-length hair.

* Furst received “at least” $11.7 million in distributions. Some of these funds were deposited into “an account held at Pictet & Co. Bankers in Switzerland.”

Additionally, a fourth professional poker player--who is only identified as “Player Owner 1”--received about $40 million, as well as millions more in what Full Tilt business records characterized as “loans.” It is unclear why this Full Tilt beneficiary is not identified, though the governmental shrouding could be connected to the player’s possible cooperation with law enforcement authorities. (3 pages)