Online poker affiliate PokerStrategy has prevailed in its bid to recover $1.2m it claimed to be owed by Pocket Kings, the Dublin-based technology subsidiary of Full Tilt Poker (FTP), but it may be a Pyrrhic victory. The Irish High Court awarded PokerStrategy €828.6k after Pocket Kings declined to contest the suit in court. PokerStrategy attorney Damon Banard told eGamingReview that while the company was “incredibly pleased” with the court’s ruling, “we are being realistic about our prospects of recovering the entire judgment debt.” Last month, the debt-ridden Pocket Kings gave PricewaterhouseCoopers the responsibility of overseeing its liquidation, and Banard has offered to assist the liquidator “as he investigates the prior dealings of the company and its directors for impropriety.”
Pocket Kings’ woes stemmed from the former FTP braintrust’s braindead decision to treat operating capital and player deposits as one and the same. The debacle that ensued was only rectified after rival operator PokerStars strapped on its white knight armor and agreed to purchase FTP and make all FTP’s former customers (but not affiliates) whole. The Alderney Gambling Control Commission, which issued FTP’s gaming license, received quite a black eye via FTP’s shoddy business practices having occurred under its nose and the UK Gambling Commission wants to take steps to ensure it never has to clean that much rotten egg off its own face.
Last week at the ICE Totally Gaming conference in London, Gambling Commission policy manager Helen O’Kane announced the launch of a consultation this spring on how best to guard against FTP-style shenanigans. There is currently no concrete requirement for UK licensees to strictly segregate player funds and O’Kane said the government had no interest in holding player deposits itself and wasn’t particularly keen on compelling operators to undergo capital adequacy assessments to determine their risk of going tits-up. O’Kane acknowledged there was no foolproof defense against fraudsters, but the Commission was considering the use of quistclose trusts, which would at least safeguard player deposits from the clutches of other creditors in case of insolvency. If nothing else, the Commission hopes to standardize and strengthen language regarding use of player funds in operators’ terms and conditions.