Oh what a tangled web we weave, When first we practise to deceive! — Sir Walter Scott Marmion, Canto vi. Stanza 17.
That seems so true on so many levels these days. The Web we think of wasn’t the same one Wally talked about. Following Lederer’s search for Truth, Justice, and the American Way has been stultifying. I didn’t bother with the second marathon interview. I did it for the same reason I try to avoid staring at car wrecks.
Bill Rini has be consolidating thought and view on these interviews. Today, he links to a nice article about what might have been going on in Howard’s intentions. Stop by and follow his link. Bill has always been one of the nice, go-to sites in poker blogdom. He can always provoke thought. If I have a complaint, it would be that he was inside and that hasn’t surfaced.
The link Bill provides is to a look at the manipulation process. That is all well and good and a further indictment of intent. Fact is we all manipulate daily. It is every relationship — temporary or permanent. It is unavoidable and a political staple. Politics here goes beyond the obvious.
The real problem I have with Howard’s explanation is his board membership. That is as basic to the issue as it gets. It is called Fiduciary Responsibility. A clean, easy to follow explanation is here. That is so basic and was so ignored by the board. How it was done is the garden variety version. They never bothered to follow clearly defined rules.
If you didn’t click to my link on the above — and few do — let me quote the most basic responsibility:
- Avoiding conflicts of interest
- Acting in the interest of the company rather than the member’s personal interest
- Providing oversight to assure that all company business is transacted legally
- Making decisions to protect the assets of the corporation.
Not one of those most basic guidelines was followed by Howard and the other board members. The charter called for an annual election of the board. Not having a timely election signifies a dictatorship. So, from year two of their existence on, they were in default and lacked legal presence.
Whether or not Howard is a “Master Manipulator” isn’t an issue. What he admits to is the issue. The board never functioned as a board. It was a California corporation that was never audited by the state. That is common to many businesses that are defunct. There was no oversight beyond private intent. And that is the reason it took so long for a government entity to bring charges. These companies concealed their non-compliance and could do so because the licensing bodies around the globe were only interested in the license fees or server business.
Our history is full of loathsome examples. Remember how the “Grand Chief” all of a sudden fronted the real owners at Ultimate Bet? Anyone who believed that didn’t deserve getting a refund. (I’m on that hook.) Yet, we played on.
The sad thing in all this was how unnecessary those corrupt practices were. The shining example is Poker Stars. To current knowledge, the only privately held operation that operated as a real business.
So, when you look at what transpired, can you say that Howard and three other board members — including a PhD and graduate degrees galore– were too dumb to know? That doesn’t seem likely given all the claims for brightness they’ve all failed to ever deny. Four worldly, intelligent men knew precisely what they were doing. And, like the Bernie Maddoffs of this world, they turn a viable entity into a fraud. They defrauded the other owners. They defrauded the players. And got penny on the dollar against the entities ongoing potential. That is sad!
Culpability also lies with the owners. They were gifted with ownership and knew they’d fallen into it. They didn’t make waves. They let obvious infractions to the bylaws sail by. They deserve being stuck. When you hear this or that one remark, remember they are the obvious cause of their predicament. They were bought and paid for and the board/corporation made distributions to keep them quiet and happy. By and large, they were stupid! They were flat out stupid. They too are getting what they deserve and due no sympathy. (One voice in the wilderness did recognize it and react but rather poorly against the now known outcome.)