Tuesday, December 18th, 2012, appears to have put an end to the civil case the Southern District of New York had against Howard Lederer, former Full Tilt Poker board member, when a Stipulation and Order of Settlement was filed.
An Amended Civil Complaint was filed in September 2011 naming four Full Tilt Poker board of directors, which included Lederer, where the government was seeking the forfeiture of $42.5 million that had been paid to Lederer by the company. Full tilt Poker was dubbed as operating as a "Massive Ponzi scheme," by the U.S. Attorney's Office which also claimed the board had defrauded players out of more than $330 million.
A Second Amended Civil Complaint that introduced new forfeiture charges which included the purchase of assets with "illegal proceeds" was filed in September of this year against Lederer and the other board members. A detailed account of Lederer's expenditures were listed in the Second Amended Complaint spanning the time period from the end of 2006 until September 2011. The complaint provided records which indicate the illegal funds were used by Lederer for mortgage payments, property taxes, retirement funds, and the purchase of numerous vehicles.
The DoJ sought the forfeiture of $42.5 million from Lederer since all expenditures listed were traceable back to the illegal Full Tilt Poker company. In filing a Motion to Dismiss on November 15th, 2012, Lederer denied the charges.
December 18th found Lederer agreeing to settle with the SDNY with Lederer contending - under the terms of the agreement - that Full tilt Poker was a "legitimate business providing services to its customers within the bounds of the law, and that prior to April 15, 2011, he was unaware of any wrongful activity at Full Tilt including that the company had become unable to satisfy its player account liabilities." Lederer also admits no wrong doing.
As part of the settlement, the following property will be forfeited:
- Lederer's 1965 Shelby Cobra roadster
- All funds in Lederer's account at Lloyds TSB International, Isle of Mann, and all funds traceable thereto. Lederer also agrees to immediately liquidate all funds and other assets in his remaining accounts at Lloyds, which have a total approximate U.S. dollar value of $168,000
- Accounts in the name, of or belonging to, Howard Lederer at LPL Financial, including the Lederer's 401K Profit Sharing Plan & Trust accounts
- All proceeds traceable to the sale of Lederer's property located at 2735 Twin Palms Circle, Las Vegas, Nevada, 89117
- $30,000 representing proceeds traceable to the sale of the property at 5426 Fawn Chase Way, Las Vegas, Nevada, 89135
- Lederer's property located at 309 Kingsclear Court, Las Vegas, Nevada 89145
Lederer agreed also to the entry of a civil money laundering penalty judgment in the amount of $1.25 million; the liquidated funds; and the "forfeiture of the Money Judgment Funds for disposition according to law, pursuant to Title 18, United States Code, Section 981, without admitting any liability thereunder." The settlement document goes on to state that additional funds are due no later than 18 months from the date of the entry of the Stipulation and Order of Settlement and adds that the remaining $750,000 is due no later than 36 months from the document's entry date.
The Second Amended Complaint had requested forfeiture of Lederer's other holdings such as Las Vegas properties at 99 Hawk Ridge Drive and 55 Skybird Court, a California property, three Wells Fargo bank accounts, and numerous vehicles but none of those holdings were listed in the settlement.
Lederer and Rafe Furst are the only Full Tilt Poker board members that have settled their respective civil case. Chris Ferguson's civil case is in settlement negotiations and Ray Bitar's case is still pending.
Information for this article taken from PokerNews.com.