Up until February 2008 Microgaming had one of the best reputations in the online gambling industry. Although a few Microgaming skins had failed over the years there had always been a happy ending. In some cases Microgaming paid the players. In a separate case Bodog assumed the funds owed to players when Betcorp, parent of Betholdem failed. Then came the collapse of Tusk.
This Two Plus Two post is a great summary of the events that started in February 2008. First Tusk Investment Corporation failed and went into liquidation. It is estimated that players are owed $5,300,000 and the total liability is about $9,000,000. That figure includes players, affiliates, skin owners, vendors and employees. It is estimated that if the liquidation is ever completed that those owed money will receive about 15 cents on the dollar.
Microgaming has done nothing and has publicly denied any liability. They deny any responsibility even though they directed potential skin owners to Tusk to get licensed. They have done nothing even though they have bailed out bankrupt skins in the past. Many Tusk casino players got reimbursed but poker players remain unpaid.
Then in August 2009 Eurolinx and BetOnBet went into liquidation. Millions of dollars are still owed to players, affiliates, employees and vendors. It has been widely speculated that the whole thing was a ponzi scheme involving Jo Remme, someone with a questionable past to say the least.
There are quite a few questions that remain unanswered that Microgaming needs to address. First why do they feel they are not responsible even though they licensed these rooms? They made money off of these sites for years and when they fail Microgaming ran and hid from an issue that they are ultimately responsible for.
Another item to consider is that money was changing hands up until the last minute these rooms were open. What happened to the money that was won and the rake collected the last few days? Microgaming has a clearing house that has a delay before funds go to the skins. This money didn’t just vanish. It would seem Microgaming kept the rake and winnings from the last few days if not weeks. It is probably safe to say that Microgaming wasn’t owed anything since they controlled the money while it was in play on the network.
A great lesson could be learned here by all network operators. Networks that allow individual skins to do their own player banking needs constant auditing. The operators need extensive background checks and a large deposit should be made by new operators to cover losses in case of a failure.
One could argue there are trustworthy Microgaming sites. Ladbrokes, Unibet and 32Red are among them. I certainly think these are respectable brands. The trouble is that you are supporting Microgaming when you play on these sites and any other network site. Since Microgaming has shown time and time again they couldn’t care less about player’s funds and security why support them? You know if the site fails Microgaming is going to bury their head in the sand once again and you will lose all of your bankroll. There are too many online poker choices out there to give rake to a company that has allowed operators to steal over $10,000,000 from players, affiliates and vendors.