Howard Lederer, who had a lawsuit worth $42.5 million filed against him by the US federal government owing to his association with Full Tilt Poker, signed a settlement deal on Tuesday, according to the terms of which he will have to forfeit assets and cash worth $2.5 million.
The 49-year-old poker player, who is known as “The Professor” in poker circles, agreed to settle with the US federal government in two parts—a fine of $1.25 for money laundering and a sum of $168,000 from his several bank accounts. While he will pay the former in 18 months, he will pay the latter in 36 months.
Besides, he agreed to forfeit undetermined funds in two bank accounts, two properties in Las Vegas worth around $975,000, funds generated from the sale of a third Las Vegas house worth $30,000, and a 1965 Shelby Cobra.
He also agreed that he will not work for any online gambling company based in the US or receive funds from any online gaming site till the US federal government legalizes online poker.
The US federal government had originally lodged a case against Lederer in September 2011, demanding forfeiture of around $42.5 million for allegedly cheating Full Tilt Poker customers. The US attorney for the Southern District of New York referred to Full Tilt Poker as a giant Ponzi scheme and accused its chief executive officers of diverting player funds for personal use.
The criminal case filed against Full Tilt Poker was settled in July and PokerStars, its one-time rival, acquired the Full Tilt Poker brand and assets in exchange for a sum of $731 million. The US government will use $150 million of this amount to pay back Full Tilt Poker’s US customers.
In September, the Department of Justice (DoJ) amended its complaint against Lederer, in which it made a list of assets allegedly acquired by Lederer using funds generated from the Full Tilt Poker business. The DoJ alleged that Lederer had purchased houses and cars and opened retirement accounts using part of the $44.3 million he had received during the 4 years “directly tied to the criminal conduct” from Full Tilt Poker.
According to the settlement terms, Lederer stated that Full Tilt Poker was not involved in anything illegal and that he knew nothing of any wrongdoings at Full Tilt Poker, including the company’s failure to refund players after the US government crackdown of Black Friday. He stated that he had done nothing wrong.