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Dec 15, 2017

Guernsey Repaying £9.5m from Ray Bitar's Fraudulent Full Tilt Funds

By RTR Dennis

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Guernsey has agreed to give the United States £9.5 million stemming from laundered Full Tilt Poker funds. Raymond Bitar, ex-CEO of Full Tilt, laundered the money through the Channel Island of Guernsey.

Bitar pleaded guilty to defrauding Full Tilt players out of £261m ($350m). However, he gave just £29.8m ($40m) of this amount to US authorities.

Guernsey, an island in the English Channel, has now given the US Department of Treasury a total of $14.3m (£10.6m) relating to the Full Tilt scandal and a separate case.

Guernsey Keeping Half the Full Tilt Funds

According to the BBC, Guernsey’s offshore industries are often targeted by criminals who are trying to launder money. This is why the island state has struck of a number of agreements with different countries to combat these perpetrators.

Such is the case with Bitar and the Full Tilt scandal, where millions of pounds were stolen from players when the poker site went offline.

The States of Guernsey has dubbed itself a "reliable partner" of the US if when it comes to seizing criminal assets and fighting money laundering.

Given their status as a quality partner, Guernsey has decided to keep the same amount (£9.5m) they shared with America.

How Guernsey Helped the US Take Down Bitar

Guernsey certainly earned the money that they're keeping by helping the US uncover Bitar's assets. They restrained the former Full Tilt head man's bank accounts and provided financial records from 2012 to 2015.

Bitar would eventually plead guilty to misleading Full Tilt Poker customers about the status of their funds. The online poker room collapsed in 2012, not long after "Black Friday" (Apr. 15, 2011).

Full Tilt owed players a collective £261m in deposits and couldn't repay the amount. As a result, US authorities labeled Full Tilt’s former operation a Ponzi scheme.

John Cronan, of the US Department of Justice's Criminal Division, noted that his Guernsey counterparts did an excellent job in this case.

Guernsey Attorney General Megan Pullum QC commended both sides on their efforts to bring down Bitar.

"Guernsey has an ongoing and exemplary commitment to international co-operation and mutual legal assistance and we are therefore extremely pleased to announce this asset share," said Pullum.

The Story on Ray Bitar & Full Tilt

As the CEO, Bitar was responsible for many of the operations at Full Tilt Poker. While he's a big reason why Full Tilt became a multi-billion-dollar company, he's also largely responsible for the lack of player funds.

Bitar and other Full Tilt executives, like Chris Ferguson and Howard Lederer, paid themselves large salaries for their lofty positions. The company also spent a fortune on signing top poker players to represent their brand.

The big problem is that Bitar failed to ring-fence player deposits from the company's operational money. The end result is that Full Tilt didn't enough money to repay players after being shut down following Black Friday.

Full Tilt, along with the CEREUS Poker Network (Absolute/UB poker) and PokerStars, were targeted by the US Department of Justice (DoJ) for wire fraud and money laundering. The end result is that they were banned from serving American online poker players and also fined.

Fortunately for Full Tilt players, the Rational Group, former parent company of PokerStars, made a deal with the US DoJ to purchase Full Tilt and repay their customers. The Rational Group wanted to avoid any wrongdoing in the case, and they had more than enough money to cover both their fines and missing Full Tilt deposits.

As for Bitar, he pleaded guilty to conspiracy to commit bank fraud, conspiracy to commit wire fraud, and unlawful internet gambling.

US District Judge Loretta Preska, of the United States District Court for the Southern District of New York, gave Bitar a break when she spared him jail time. He had a serious heart condition and could've died in prison had he not received a heart transplant. Instead of jail time, Bitar was forced to surrender his assets, which included several homes and $40 million in cash.

Bitar has stayed out of the poker world ever since. But it appears that he's now healthy after losing a considerable amount of weight. He also married Jacquelyn Lucas in multi-million-dollar wedding in 2015. This shows that US authorities didn't take all of his wealth.