The Erick Lindgren scandal teaches a lesson to poker players who decide to stake their colleagues, friends, and acquaintances. Frankly, Erick Lindgren's troubles with gambling debts serve as an example for anyone who lends money to friends, regardless of what the person borrowing cash wants to do with the funds.
Before I editorialize too much about the Erick Lindgren debt scandal, I want to present the background and the facts. Here's what we know: Full Tilt Poker team member Erick Lindgren appears to owe numerous people in the industry money. We know this because a thread was started on the popular Two Two online poker forum by someone claiming Edog owed them money. Soon, the thread filled with people claiming the same issue, including high stakes poker player Haralabos Voulgaris. Though these charges have never been substantiated, Erick Lindgren has never spoken out against them, so most people assume these stories are factual.
Erick Lindgren is a American poker player who was born in California in 1976. He has one 1 World Series of Poker bracelet and 2 World Poker Tour tournament events. The WPT wins led him to publish the 2005 "World Poker Tour: Making the Final Table", which gives edog's strategies for winning tournament no-limit Texas hold'em. In 2008, the Californian was the WSOP Player of the Year, which means his peers voted him as having the best all-around 2008 World Series of Poker, entailing events beyond the Main Event. In total, the 36 year old player has won over $7 million in tournament poker winnings over the course of his career.
This has won the gambler, author, and expert both fame and riches. As an investor in the Full Tilt Poker website, Lindgren was one of a stable of professionals who ran one of the largest card sites in the world, along with famous players like Phil Ivey, Chris "Jesus" Ferguson, and Howard Lederer. With the slogan "Learn, Chat and Play with the Pros", FTP lured millions of worldwide poker players to join their site and enjoy ring games, sit-n-go's, satellite events, and online tournaments on their site.
The FullTilt Poker team was world-famous and extravagantly wealthy. Lindgren led a particularly glamorous lifestyle, as he married fellow poker playing professional and blond beauty, Erica Schoenberg, in May 2011. Phil Hellmuth and Daniel Negreanu attended the wedding, posting pictures of the event on their Twitter feeds. Other members of the community sent their well-wishes online, including Doyle Brunson, Kimberly Lansing, and Kara Scott.
Below the surface, trouble was already brewing. Just six weeks before the wedding, on April 15, 2011, the United States Attorney's Office handed down indictments in the South District Court of New York against members of the FullTilt Poker Team. American authorities had been investigating suspicious activities involving both PokerStars's and Full Tilt Poker's investments in small-town American banks, where the Internet poker companies used their influence to have these banks pay gambling debts to US players, possibly flaunting US gambling laws like the UIGEA. The US Attorney claimed these activities amounted to money laundering and therefore felonies under US law.
This wasn't the only revelation involving FullTilt Poker. It seemed that FTP was paying its investors millions of dollars a month. This might seem reasonable, but it appeared that this payments came out of the FTP bank, which was supposed to contain enough money to cover all bets that were made at Full Tilt at any given time. Gamblers know these bets have an infinitesimal chance of going against the house all at once, but since the payments appeared to empty the coffers of significant amounts of the house's money, American prosecutors labeled FullTilt Poker a "ponzi scheme". Some of America's most famous poker professionals suddenly looked like they would go on trial to avoid prison time.
Even more astounding to many was the revelation on 2 2 that Erick Lindgren may have had major financial difficulties before the legal troubles with FTP began. While Chris Ferguson and Phil Ivey were being paid amazing sums of money every month by FullTilt, information has surfaced that Erick Lindgren was paid the smaller sum of about $250,000 a month by FTP. Despite this, the poker pro appears to have owed debts to other gamblers and to high-stakes fantasy football players for years. According to multiple sources, the history of owing debts go back at least 5 years, while one of the fantasy football players who claimed he was owed money said Erick tended to wait 5 to 6 months to pay off debts.
The scandal has opened many eyes about how many pro players carry debts around, despite playing with and often winning huge sums of money. A player with a known reputation might owe one person a sum of money for a period of months, then borrow money from a second person in order to pay back the first. In this way, debt is simply passed around, though it often mounts over time.
A common excuse in these cases is to claim one is "cash broke". In this way, gambling debts aren't paid off right away, or perhaps ever. It should be noted that most of the people who have posted online about Lindgren's debt situation have stated (later) they either have been paid back or they still expect to be paid. This despite the fact that some claim to be owed as much as $66 thousand, while others have claimed lower sums like $11 thousand. Some have stated the famous gambler has been ungracious in paying back his own debts, while others have stated he gave them the run-around.
Where most of the outrage comes is from the fact that the Team FTP pro was receiving $250K every month, while still running up debts at the poker table--and presumably away from the casino. It would take a great amount of profligate living ($8,000 spent a day) to go through a quarter-of-a-million in a month's time. Being owed $10,000 by someone with an income of $3 million a year has outraged some of his creditors, now that they realize how much he was receiving over the past few years. Being rude about paying back the lenders only added fuel to the fire.
Of course, now that it's become clear that more the Full Tilt Poker money has dried up and the IRS could be coming after Erick Lindgren, many of those who've expressed optimism about their colleague's ability to pay may be concerned whether they'll ever see their dollars again. I suspect they're going to be a long time waiting for repayment.
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