DoJ unseals superseding indictment against Bitar and Burtnick
Full Tilt Poker CEO and head of payments could face $2.5bn fine " FTP had just $2.1m in funds as of June 2011.
The United States government has unsealed a superseding indictment against Full Tilt Poker (FTP) CEO Ray Bitar and head of payments Nelson Burtnick, detailing allegations of defrauding both financial institutions and Full Tilt Poker customers through the miscoding of transactions and lies about segregated player accounts respectively.
Among other allegations, Bitar is accused of having approved eight-figure monthly profit distributions to himself and other owners in the months before Full Tilt’s closure, despite a February 2011 warning from financial staff that the operator was projected to run out of all funds in a matter of months. Indeed by June of the same year, the company had just $2.1m in available funds.
The pair are charged on 11 counts, and could face fines in excess of $2.5bn between them as well as being required to forfeit all ownership rights to Full Tilt and its associated companies.
News of the indictment comes just hours after eGaming Review learned that Bitar had returned to the United States to hand himself in, nearly 15 months after being named in the Black Friday indictments.
The new indictment makes reference, among other things, to an unnamed “well-known professional poker player” – referred to only as ‘CC-1’ “ who it describes as a “co-conspirator”, adding that he and Bitar “Were at all times relevant to the indictment the co-managers of Tiltware LLC.” Tiltware, whose board comprised Bitar as well as poker pros Howard Lederer, Chris Ferguson and Rafe Furst, is described and having “beneficially owned and controlled” Full Tilt Poker and its associated companies.
It also details “A representative of Full Tilt Poker assigned to monitor and respond to forum messages,” accusing this representative of posting inaccuracies about the supposed segregation of player accounts.
Bitar is also accused in the indictment of having instructed the company’s director of finance “To count as company ‘cash’ over US$100m that third-party payment processors owed to Full Tilt Poker but had never paid the company and in many cases never would because, for example, the processor had stolen the money or because the funds had been seized pursuant to US court order.” This is alleged to have led to the submission of falsified financial statements to regulator the Alderney Gambling Control Commission, a matter which preceded the commission’s suspension and subsequent revocation of FTP’s operating licences last year.
In one such statement, filed in August 2010, Full Tilt claimed to have more than $370m in “total cash held” when the actual figure was less than $125m. The indictment claims that the actual amount of cash held was $200m lower than the amount owed to players at the time.
The indictment also cites statements made by Full Tilt Poker following the shutdown of its US-facing operations in April last year, explaining that the operator’s reassurances that player funds were “safe” and their money would be “returned to [them] as soon as possible”, while noting this would not have been possible given that, of the $390m owed to players at that point, FTP had less than $60m in its bank accounts. By 10 June 2011 the latter figure had fallen to just $2.1m but Bitar and Burtnick “Continued to take a salary from the company, collectively receiving several million dollars after April 15, 2011.”
Among the 11 counts listed in the indictment are, money laundering, violation of the Unlawful Internet Gambling Enforcement Act (UIGEA) as well as three counts of wire fraud against players. These counts include the false claims regarding segregated accounts as well as two separate money transfers to Bitar’s own bank account, the more recent of the two amounting to $1m and paid in February 2011. Two of the counts also relate to Burtnick’s time with PokerStars, which ended in 2007.
Bitar and Burtnick have been ordered to forfeit all proceeds received “As a result of operation of the unlawful internet gambling businesses alleged in counts three and eleven, and the amount of property used in committing the gambling offences…” This amounts to at least approximately $1bn in relation to FTP, $1.5bn in relation to PokerStars, as well as rights to numerous properties and bank accounts held in Ireland, Germany, the United States and the Channel Islands. The indictment also calls for the pair to forfeit any right, title or interest in 15 named companies including Full Tilt Poker Limited and Tiltware, plus other companies tied to both Full Tilt and PokerStars.
The other charges included in the indictment include their own separate forfeiture allegations, with one “ relating to the alleged offence of conspiracy to commit money laundering “ calling for Bitar and Burtnick to forfeit “A sum of money of at least $2.5billion in United States currency.”