Wednesday July 4, 2012 : 5050 POKER FINANCIAL SITUATION IN THE OPEN
5050 Poker players can expect no more than 15 percent of their account balance back
A media advisory posted on the 5050 Poker Holding AB website has addressed 5050 Poker Ltd’s player payment concerns and it is not good news.
5050 Poker Ltd will be liquidated or possibly sold due to the Maltese Lotteries and Gaming Authority's (LGA) request for guarantees at a level that exceed the assets in the company, said a company statement.
Furthermore, Patrick Sjögren, 5050 Poker Holding AB's managing director has been axed and Cem Yeter and Olle Langenius, Directors of 5050 Poker Holding, have been tasked with a further investigation into the fiasco with a view to saving as much of the shareholders’ value as possible.
5050 Poker Holding AB's Board of Directors claim that Microgaming's “suddenly imposed table limit” and the subsequent cessation of its operations along with fines it says were dealt out by Microgaming for "having too many winning players" resulted in a run on the bank by players effectively leaving the company with insufficient funds to cover player balances.
The Board further claims that the company's financial situation went undetected as it (the Board) was provided falsified information on the player's fund, operational costs and the size of the company's assets.
An internal investigation by 5050 Poker Holding AB revealed the following:
– The operational costs of 5050 Poker Ltd has for a long time exceeded the revenues, resulting in players’ funds being used in the operations of the company.
– Fines imposed by Microgaming in excess of Euro 150 000 had incorrectly been withdrawn from players' accounts.
The bad news for players is that the value of available assets will be used to pay back players on a proportional ratio. The Board said "there is no reason to believe that the ratio will be higher than 15 percent of the actual balance of the players’ funds."
The company's unnamed auditing firms will also have some tough questions to answer as both 5050 Poker Ltd and 5050 Poker Holding AB reportedly underwent an audit for the 2011 fiscal year.
The full advisory can be accessed at http://www.5050pokerholding.se/en/press/46-information-to-the-shareholders-of-5050-poker-holding