It seems that online poker players have learned something after the advent of Black Friday. Not only that, but in a recent PokerStars press statement it was outlined how player funds were handled in comparison to the way Full Tilt Poker had done the same at the time. In essence PokerStars claim transparency with player’s money. But there is a huge difference between PokerStars and online brands such as 888 and PartyPoker for example.
Both 888 and PartyPoker are public companies. Both are listed on the London Stock Exchange and this makes them responsible to Company Law as well as licensing jurisdictional law, which is basically the law of the country. PokerStars on the other hand is a privately held company, which means the only law they are subject to is the law of the licensing jurisdiction.
However, this brand did behave admirably in the light of the DoJ seizure of their domain, where players in the US and internationally were able to withdraw funds from the site without too much trouble. This was in complete contrast to what took place with FullTilt.
The big difference for PokerStars is the fact that they are licensed on the Isle of Man. Isle of Mann makes it part of their jurisdictional rules that separate accounts are maintained for player funds. So this means that player bankrolls do not get mixed up with operational funds. Full Tilt on the other hand, was licensed with the AGCC – Alderney Gaming Control Commission, and although this is an excellent licensing jurisdiction, they do have different rules. Being the Channel Islands, this state does not dictate what operators do with their money. The Channel Isles have always been famous (or infamous?) for brilliant low tax and other lax offshore banking opportunities.
Full Tilt were more than likely only responsible for bad management decisions and poor judgment calls. But the DoJ has labeled them in the same category as the Mob, as a Global Ponzi scheme, and all kinds of awful accusations. In the face of the fact that Full Tilt members have been unable to withdraw their funds; this makes for a remarkable marketing opportunity in which Poker Stars to paints themselves white as the proverbial driven snow.
Head of Corporate Communications – Eric Hollreiser – had a field day explaining that their brand uses specific accounting methods to absorb the risks involved in working with payment processors online. In other words they do not pass the risk onto the player, but as we explained before, they are compelled to segregate funds by the laws of the Isle of Man.
More sophisticated online poker players are choosier about their brands today and are deciding to play with publicly traded companies such as Party Gaming and 888Poker. However, this does not seem to have made much difference to players at PokerStar. Despite the fact that players from the US are no longer allowed; they still managed to attract 200 000 players online simultaneously to break their own Guinness World Record recently; for the most online players in the same tournament at the same time!