Wednesday September 19,2012 : PART TWO OF ‘THE LEDERER FILES' NOW UP
Former Full Tilt director talks about accounts segregation, processors and legal advice
The second episode of the Poker News interview series with Howard Lederer is now available to registered users at:
Whilst Lederer continues to profess ignorance on the nitty gritty of Full Tilt financial and management issues, he does give interesting insights into how the company developed and grew, perhaps too fast for its own good, under the leadership of Ray Bitar but with the oversight of original investors that included Lederer, Chris Ferguson, Phil Ivey and other big-name poker aces on the board of directors.
His interview has revealed details of how the company started; the sometimes clashing personalities involved and the relationship of the board of directors to the operational management in various issues that confronted the company, originally a small Californian LLC start-up which burgeoned into a major Irish company and the second largest online poker provider in the industry.
Lederer has on several occasions made the point that a two thirds majority of the board of directors could have changed the operational management, but a truly serious challenge to CEO Ray Bitar's authority never seemed to emerge.
In the second episode of the series, Lederer discusses Full Tilt Poker's decision to remain in the U.S. post-UIGEA and the payment processing issues that flowed from that decision, which was made only after legal advice was obtained from top US legal firms.
One important element that has to be remembered in the unfolding events is the prevailing environment and the attitudes of experts, the public and the industry back then. These have since been significantly influenced by the actions of the DoJ, initially against processors and then operators, culminating in the Black Friday shutdowns.
The industry is very different now to what it was several years ago, and it is easy to forget that with the benefit of hindsight.
The highly contentious issue of segregated accounts is discussed at some length in the second episode, with Lederer recounting how he brought a player's enquiry on this to the attention of the financial management of the company.
Lederer's central concern at all times appears to be that the company should have more cash available than was necessary to cover its player liabilities, but the mechanics of trusts and segregated accounts was an operational issue in which he was not directly involved.
The involvement of Intabill and alleged DoJ collaborator Daniel Tzvetkoff also crops up in the discussion.
Lederer discusses his decision to step down from his management role with the company, a choice he claims he made in late 2007. Lederer remained on the board of directors, and recommended the a search for a seasoned and experienced COO as the search began for his replacement.