Serious problems at Purple Lounge

[DiamondGeezer]

Just been reading a bit more about Media Corp. They have another unrelated business in online advertising called Eyeconomy Ltd. Media Corp seems a very odd combination of two completely different businesses. Then I read:

The deal sees Media Corp enter into a related secured loan agreement with Barclays to draw down up to £750,000 in working capital for the enlarged group. The agreement is for a period of 12 months with interest payable at 10% above the base lending rate of Barclays and is secured over the intellectual property and company assets of Media Corp’s wholly owned subsidiary, Eyeconomy Limited.

So they are paying 10% over the Barclays base lending rate? That could be interest of around £100K!!! You would have to be very desperate to enter a loan of that interest.

Can't believe there isn't someone within the industry who is willing to step up to the plate and try and sort this mess out. It's an opportunity for someone to take control of this and assist these players. Chances of getting money back right now are still very good but you must act now. If everyone dithers for another month it could be too late as the legal process does take a few weeks.

 

[jetset]

True segregation of player funds could happen if the regulators required it. The Law Society of Upper Canada (Ontario, Canada) requires that client funds be placed in a separate trust fund... all the clients' funds are deposited in the same account, with bookkeeping keeping track of what client has what funds in trust.

If a firm goes belly up, the landlord, employees and other creditors cannot access those funds.

This doesn't mean that no lawyer ever steals from their clients, but it does mean an annual inspection of this trust account, and legal and possibly criminal sanctions if they don't comply with the regulations.

That's right - actually in Australia there is an investigation ongoing right now after player complaints that the regulator of the failed online sports betting operation Sports Alive had failed to properly protect players.

Sports Alive crashed owing more than A$10 million, including about A$327,000 to the ACT Revenue office.

The liquidators of the failed company say that A$3.9 million is still owing to more than 18,000 punters and the Ombudsman has been under pressure to investigate after allegations that the Gambling and Racing Commission failed in its duty to regulate the bookmaker properly.

Punters have accused the regulatory body of failing to ensure Sports Alive maintained segregated bank accounts of betting monies, which is required by legislation.

Despite monthly audits claimed by the regulator, financial documents show Sports Alive was sinking into insolvency for almost three years before its eventual collapse.

Sounds like another 'ace' regulator!

 

[DiamondGeezer]

Here is another one for you, WorldSpreads a spread betting firm.

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The problem is even if you segregate client's funds, the client fund account is still controlled by the company. And when they get desperate it seems few companies can resist dipping into it. If the clients hadn't had FSA protection up to £50K they would have been unsecured creditor's. It's not easy to see how the regulator's can prevent this happening since companies can move money so fast these days.

 

[jetset]

Perhaps one answer is the deterent effect of punishment of the directors concerned, or even criminal prosecution where the directors responsible have played fast and loose in their management of the company.

That is a possibility in the Worldspreads case, where the regulator called in the criminal police and an investigation is in progress - I think we may be hearing a little more about the former directors at Worldspreads when that enquiry has been completed.

IMO directors need to believe as well as understand that there can be very serious personal consequences for reckless and unprofessional behaviour, and that their future business activity can be impacted by their current conduct.

But again, much of this comes down to genuine regulation with intent and teeth, which I fear is sadly lacking here. No doubt Drummond et al will move on to further commercial adventures despite the stain this one has imo placed on his reputation.

 

[alfonso07]

That's right - actually in Australia there is an investigation ongoing right now after player complaints that the regulator of the failed online sports betting operation Sports Alive had failed to properly protect players.

Sports Alive crashed owing more than A$10 million, including about A$327,000 to the ACT Revenue office.

The liquidators of the failed company say that A$3.9 million is still owing to more than 18,000 punters and the Ombudsman has been under pressure to investigate after allegations that the Gambling and Racing Commission failed in its duty to regulate the bookmaker properly.

Punters have accused the regulatory body of failing to ensure Sports Alive maintained segregated bank accounts of betting monies, which is required by legislation.

Despite monthly audits claimed by the regulator, financial documents show Sports Alive was sinking into insolvency for almost three years before its eventual collapse.

Sounds like another 'ace' regulator!

i have been intrigued by the issue around the segregation of the players funds and what does the Malta LGA require and what it actually does. once again i called some friends on the island, or who have been around there, and they informed me on the following:
- the regulations state that the operator must at application stage identify which bank account has been designated for the segregation of players funds;
- the operator must also provide a official letter from the Bank holding the account, declaring that the account has been ring-fenced against any action/s the company might suffer from creditors, and in some times the LGA requests that it is listed as beneficiary so that in the worst case scenario, the LGA attempts to settle the players itself;
- on a monthly basis, once the operator has gone live, the Key Official (KO) - the responsible director of the operation, has to file a report listing all the balances and the total of such should tally with the amounts held in the ring-fenced bank account (plus the funds held by the PSPs, for clearing);
- every six months the operator has to file management accounts and every year it has to file audited accounts;

all of the above is based on the submissions made by the operator - presumably not following any of them would lead to administrative fines. My friends insist on telling me that the players balances presented on a monthly basis are not really checked by the LGA or anyone else - the figures submitted can be truthful but could also be false - it is up to the operator.

coming back to the PL case, the situation does not seem to have happened overnight. i.e. the company did not loose all the funds within a month neither. hence the matter rests on the submissions (if any) made by the KO of PL to the authority and the latter's enforcement of its own regulations. my sources tell me that there have been heavy administrative fines dished out by the LGA to other operators for not making the necessary submissions. in this case PL must have been inundated with these fines since the last audited financial report submitted to the company registrar is dated Q4 2011 but is for the financial year ending 2008. as for the submissions of the monthly player balances, i wouldnt dare trying to think what was presented to the LGA. Alternatively, the regulator closed both its eyes and turned its heads because it seems the only director of PL was a prominent lawyer on the island prior to filing his resignation and placing the PL UK company in his stead - this apparently before the actual termination of the license by the LGA.

the pitty of this whole story is that the island of Malta, as described by some business partners who live there, seems to be a bubbly country which strives on financial services and cases like these, can only tarnish its reputation. all said, the reputation has to be also maintained and secured by its regulator.

one question relative to the possible unsettled balances - in previous blogs, someone mentioned that there have been players who got settled all their dues - is this the case for all or are there still players unsettled, especially balances which date before the termination of the license. my logic tells me that if there are still amounts dues pre-termination of the license, than the LGA's statement "Before the termination process was completed, the Authority made sure that there were no pending complaints and that the licensee was compliant with the Remote Gaming Regulations." is flawed or else none of the unsettled players bothered filing a complaint with the LGA prior to termination.

 

[jetset]

Thank you for another good, informative post, Alfonso - I think that illustrates not only the questionable activity of Media Corp management in the Malta context, but also yet again the apparent ineptness of Malta regulation.

Here's another - Pokerfuse is currently reporting on the latest developments on the long drawn-out saga of Everleaf and what - if anything - the LGA is doing to assist players in that disaster. I won't post a link in deference to Casinomeister, but it's on the front page of the Pokerfuse site.

 

[DiamondGeezer]

No doubt Drummond et al will move on to further commercial adventures despite the stain this one has imo placed on his reputation.

Well losing the odd few Billion never harmed Andy Hornby:

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[DiamondGeezer]

The part I don't get in all this is why didn't they dispose of PL late last year when it was still Microgaming? They would have been able to get a fee then. It was a good brand. Now they have changed softwares and lost their license it can't really be worth much. And why would Intabet want to align themselves with such a toxic business? Chances of any sort of relaunch look close to zero. It all seems very odd.

 

[rainmaker]

Article from calvinayre.com

May 24, 2012- Purple Lounge shutdown taints Media Corp, Malta LGA and rakeback poker sites


Purple Lounge (PL), the online gambling offshoot of publicly-traded UK firm Media Corp, has been offline since April 24, when Media Corp “temporarily suspended” its struggling gaming division’s activities. The shutdown followed a gathering swell of complaints from players over the inability to withdraw their funds, during which players received written assurances that “your funds are safe and secure as Purple Lounge is part of Mediacorp PLC which is listed on London Stock Exchange.”

In retrospect, this shouldn’t have inspired much confidence. Over the past year, Media Corp’s business strategy could charitably be described as haphazard. It started with the £1.1m loss the company took on its gambling.com domain auction, the proceeds of which the company planned to use on “a number of exciting acquisition opportunities.” Instead, Media Corp continued to sell off “underperforming” businesses, including online TV listings guide onthebox.com and foreign exchange advertising site Forexspace.com, which launched with great fanfare in January 2012 only to be sold a couple months later.

........

The rest of the article here:

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[jetset]

It's a useful recap of the events we have watched unfold here at Casinomeister, although to my eyes their view regarding why PL was ejected from Microgaming's network is pretty speculative, as is the juxtapositioning with Lock-Revolution.

But nothing surprises me anymore.

What I cannot understand is why the new management has still made no effort to engage with their most precious asset - their players.

 

[$97 All in.]

I think I read somewhere that Media Corp actually paid $20 million for gambling.com & then sold it some years later for $2.5 million. Perhaps that's where account holders & share holders money went.

 

[jetset]

Link Removed ( Old/Invalid)

UK-based Media Corpporation sold the domain to an unnamed company also based in the United Kingdom for £1.5 million in cash. According to the seller, the transaction formally completed on 27 April, with the receipt of funds and transfer of the domain name.

The company says it’s ‘pleased’ with the price, although Media Corp apparently paid $20 million for the domain name back in 2005.

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Media Corporation, an Aim-quoted advertising network and online gaming group, has incurred a £1.1m ($1.8m) paper loss on its sale of the domain name, which provides a portal to gambling sites.

The company, once known as Xworks, reversed on to Aim in 2001 as The Gaming Corporation. It acquired Newbold, the owner of gambling.com, in 2005 for £10.5m in cash and shares.



Old / Expired Link

Online media and advertising firm Media Corporation has announced that it has finally sold its Gambling.com gambling and information portal to an unnamed buyer for $2.5 million in cash.

Media Corporation first placed Gambling.com up for sale in late-November in order to ‘fund acquisition opportunities’.

The London-based firm revealed that the sale, which was handled by domain brokerage firm Sedo GmbH, was completed on April 27 following ‘an extensive auction process’

“As at September 30, 2010 Gambling.com was valued on the group's balance sheet at $4.25 million, meaning that the sale will result in a one-off loss in the profit and loss account for the current financial year of $1.75 million,” read a statement from Media Corporation.

 

[jetset]

Another scathing piece on the LGA is up at Pokerfuse.

 

[alfonso07]

Another scathing piece on the LGA is up at Pokerfuse.

It's seems that this PL saga is still alive and kicking. Just two quick questions to fellow members at casinomeister:

- does any one know of players who had requested withdrawals prior to the termination of PL's licenses, I.e. 23rd April 2012, and has not received a cent/penny?
- if there are such players, did any of them report such delays to the LGA?

The reason for the above questions is to determine whether the LGA is completely at fault for not assisting players or whether PL' s administration (the uk and ultimately the Malta director) committed a fraudulent act by stating that all players funds had been honored. If the LGA was shown that all players' monies had been paid out AND PL somehow provided evidence that all players' complaints had been addressed (via settlement), than the only fault with the LGA would be that of just relying on information provided by PL.

I don't know what mechanism exists with the LGA to tackle players' complaints...whether they just acknowledged such complaints only or whether they do revert back to the same players informing them of what information would have been collected from the operator.

 

[dunover]

I notice people are referring to the LGA here which by popular consensus where mentioned elsewhere on here seems inept and a mere rubber-stamping outfit. This is why I started the 'credit card protection for chip buyers' thread because it seems (to me) the logical course of action would be consumer protection as this, leastways in the UK, carries far more clout than gaming commission or eCogra or whatever. I can't see anyone getting any joy from Malta or Ecogra/GC, which is why I wanted to clarify via other posters' knowledge if thye knew of any cases-in-law or experiences of going down the consumer protection route? I at least expected a lenghty reply from the Vinyl bloke who seems to know a lot

 

[whatever]

It's seems that this PL saga is still alive and kicking. Just two quick questions to fellow members at casinomeister:

- does any one know of players who had requested withdrawals prior to the termination of PL's licenses, I.e. 23rd April 2012, and has not received a cent/penny?
- if there are such players, did any of them report such delays to the LGA?

On the 23rd of April I had 2 pending withdrawals from Purple Lounge totaling a little over 12k pounds. The first one was at that time exactly 2 months old (has been requested on Feb. 23rd), the other has been requested Mar. 14th. Dates and amounts owed to me have been acknowledged in an e-mail from the casino 'vip manager'.

I didn't contact LGA because I knew they were oblivious to these issues and I didn't think this would get this far.

I know of other players in my situation, having withdrawals which had been pending for weeks before they went down.

 

[vinylweatherman]

I notice people are referring to the LGA here which by popular consensus where mentioned elsewhere on here seems inept and a mere rubber-stamping outfit. This is why I started the 'credit card protection for chip buyers' thread because it seems (to me) the logical course of action would be consumer protection as this, leastways in the UK, carries far more clout than gaming commission or eCogra or whatever. I can't see anyone getting any joy from Malta or Ecogra/GC, which is why I wanted to clarify via other posters' knowledge if thye knew of any cases-in-law or experiences of going down the consumer protection route? I at least expected a lenghty reply from the Vinyl bloke who seems to know a lot

The consumer protection legislation for card purchases will be of use, but firstly the company would have to be formally liquidated, making the card issuer solely liable for the lost money. It could end up being liable for all of it, since under this proetection, even if only a deposit of £100 or more is paid on the card, the bank is liable for the whole lot!

If the company is still trading, it is a matter of the card issuer being jointly liable, but only for the amounts actually paid from the card. This is the usual "chargeback" procedure, where the card issuer contacts the merchant to allow them to make a representation and pay the amount back voluntarily. As this is a UK based company, listed on AIM, this could be a powerful weapon for UK players in the longer term if PL continues to lie and stall over multiple periods of 7 days, and could well force the parent company to pay up voluntarily rather than risk players proceeding to make formal claims from the card issuers.

Remember also that the casino industry hates chargebacks, because in most cases the business is "under the radar" because of the regulatory regime in many countries, so is not in a position to give it's own side in a cardholder dispute, a weakness widely abused by fraudulent players who routinely charge back their deposits, and would keep doing so if they could get away with it. This is fought by having central lists of players who have charged back deposits, which can result in the player not being able to play again at ANY online casino.

The FIRST option therefore should be to "make waves" with Trading Standards, and try to get the media involved. Hopefully, this will cause one of the "agony aunt" columnists to cover the story, and advise players to contact their card companies to recover the money (I see this advice appear frequently when readers have written in about a cowboy company that took their money and ran, but the payment was by card). If this happens, such an article should be brought to the attention of Media Corp, who upon seeing it will be $h1tting themselves that within days they are going to get hit with a tsunami of "chargebacks" from UK players who still read the "tabloid" newspapers. They may decide to stem this by KEEPING their promises to pay players their outstanding balances, and not a single "chargeback" would be needed.

On the 23rd of April I had 2 pending withdrawals from Purple Lounge totaling a little over 12k pounds. The first one was at that time exactly 2 months old (has been requested on Feb. 23rd), the other has been requested Mar. 14th. Dates and amounts owed to me have been acknowledged in an e-mail from the casino 'vip manager'.

I didn't contact LGA because I knew they were oblivious to these issues and I didn't think this would get this far.

I know of other players in my situation, having withdrawals which had been pending for weeks before they went down.

What are the rules for submitting a complaint to the LGA, in particular a time limit after you knew of a problem in which you have to make a formal complaint.

If such a time limit is long enough to stretch back before 23rd April, it may be worth a shot, even if it proves that when the LGA terminate a license, it is applied retrospectively to complaints that stem from before the termination.

PL also repeated the lies to players that the problems were actively being pursued that was holding up their withdrawal, thus surely players were STILL receiving positive responces via the internal complaints procedures at PL, so were not required to submit a complaint to the LGA until they reached "deadlock" with PL. For many, this state of deadlock only took place when PL stopped responding at the end of April.

PL then lied to players that this lack of access to the site, and lack of responses, was nothing more than a "technical issue" that was being dealt with, a lie that allowed them to hold off a tide of complaints to the LGA until they had secretly bailed from their license. This is nothing less than a fraud by deception, as it denied players legitimate access to the regulatory complaints system, crap though it is.

Unfortunately for PL, this has created a massive "stink" in public, and has damaged the brand and holding company such that it lost some deals that were under discussion.

If there has been fraud, and it can be proven, the directors can then be sued personally, thus losing the protection of limited liabilty status granted to companies. It does not really matter that they bailed from the company shortly after, as it would be a personal liabilty, not a company one.

Remember, the US successfully prosecuted the FORMER directors of Neteller for activities that took place BEFORE UIGEA, and at a time when they were in charge. Similarly, PL directors could be sued for what they did before April 23rd, even though they have now left the company.

The company itself can also be sued, as they are still trading, and more damagingly for their reputation, are making deals with liquid cash whilst at the same time claiming they are currently unable to settle debts to consumers, something that can get a UK based company into serious trouble if the authorities decide to investigate.

UK players could try complaining to Trading Standards, and stating that a company owes them money that is supposedly in a trust account, and segregated from operating funds (as stated in the LGA standards for operators), is refusing to pay even though they have permanently closed the service and surrendered their license, and are clearly not "bust" as they are still trading and making acquisitions of other businesses.

 

[whatever]

I phoned Media Corp and talked to a guy who frankly didn't know if he will still be working there in a week's time or not. They basically deal with the same uncertainty as players.

He told me there are discussions within the new management this week regarding further actions affecting players, employees and suppliers alike. He seemed aware with what is being said on forums about PL and the LGA.

He obviously couldn't tell if players' funds were kept in a segregated account or not. All he could say is that the move from MG to Entraction (which was a voluntary business decision) triggered substantial withdrawals which led to the current situation.

 

[DiamondGeezer]

On the 23rd of April I had 2 pending withdrawals from Purple Lounge totaling a little over 12k pounds. The first one was at that time exactly 2 months old (has been requested on Feb. 23rd), the other has been requested Mar. 14th. Dates and amounts owed to me have been acknowledged in an e-mail from the casino 'vip manager'.

I didn't contact LGA because I knew they were oblivious to these issues and I didn't think this would get this far.

I know of other players in my situation, having withdrawals which had been pending for weeks before they went down.

Anyone owed money by these guys ought to be talking to a solicitor and getting their claim going via the Small Claims Court or the High Court. If the sum is not disputed then it is a straightforward process. If the amount owed is low you can even do the Small Claim's application yourself.

 

[whatever]

Can someone outside UK do this?

 

[vinylweatherman]

I phoned Media Corp and talked to a guy who frankly didn't know if he will still be working there in a week's time or not. They basically deal with the same uncertainty as players.

He told me there are discussions within the new management this week regarding further actions affecting players, employees and suppliers alike. He seemed aware with what is being said on forums about PL and the LGA.

He obviously couldn't tell if players' funds were kept in a segregated account or not. All he could say is that the move from MG to Entraction (which was a voluntary business decision) triggered substantial withdrawals which led to the current situation.

This would indicate that they had been breaching the segregated account rule for some time, but only got found out when they had a sudden and significant call on these funds from poker players. Unlike casinos, poker players win from each other, with the skin taking a rake. With enough volume, this should guarantee a profit.

It seems they didn't understand the business they were in, so were taken by surprise when players fled, rather than moved to the new software.

Where was the market research?

The other possibilty is that this was NOT a "voluntary business decision", but them getting kicked off the MGS network and being forced to find another network even though this would not be popular with players.

Had they known what they were doing, and done their market research, they would have seen this decision would lead to a surge in poker withdrawals from those players who wanted to stick with MGS.

If the employees fear for their jobs, and know that suppliers risk never seeing their money, how come they are managing to sell this as a positive thing to the stockmarket, and continue to make acquisitions with what may well be worthless shares.

 

[jetset]

I doubt that they left MGS 'voluntarily', but I don't think we'll ever really know.

Regarding 'Whatever's' questions on the LGA, it's impossible to prise any sort of communication out of these blokes - I've been trying for the past three weeks with not even the courtesy of an acknowledgement, and I know other media guys are having a similar experience with this so-called regulator.

Even if the LGA was fed BS or less than timely information, it remains a stain on their already rocky reputation, because it suggests that as a regulator they were less than effective in monitoring their licensee and its submissions.

Judging by the very questionable behaviour of Media Corp's former management in other aspects of this affair (VWM's recap above is a useful reminder) I guess we should expect almost any subterfuge, and that isn't assisting or respecting the players.

I don't buy the "financial crisis brought on by the change of software provider" story - that's not supported by the other facts, and the employee may not be privy to management's thinking.

The continued silence of the new Media Corp management is particularly worrying, because under these circumstances and the lack of trust that has been created, it generates fear that they are no better than their predecessors...something which almost guarantees another haemorrhage of players when they can get their hands on their money, and certainly a deterrent for any new player doing even basic research on Google.

Regarding players with unresolved complaints from before the licence termination, I would risk the prediction that the LGA will wriggle out of any attempt to assist, and by now any deposits they may have held have probably been released anyway. Still, I would like to hear that complaints have been submitted, even at this stage, and what the response of the LGA would be to that.

 

[dunover]

Can someone outside UK do this?

If you are in the EU then there is a reciprocal arrangement for small claims, so yes you can. Outside, I don't know.

 

[whatever]

If the employees fear for their jobs, and know that suppliers risk never seeing their money, how come they are managing to sell this as a positive thing to the stockmarket, and continue to make acquisitions with what may well be worthless shares.

The person I've spoken to said their internet advertising arm was profitable and was supporting the gaming venture (this was also mentioned in their reports). Probably that's where the value of the company lies.

Regarding the poker platform change, he argued that under IGT's ownership Entraction poker network has better growth perspective than Microgaming, so it seemed like a good business decision. He did say this is just an employee's guess and the exact reasons are only known by the (former) management.

 

[questa]

I called them this morning and asked if they were likely to pay me any time soon, or should I just go ahead and sue them. They said they would call back but didn't, so this afternoon I filed the first stage of the legal process. They have assets, so I'm going after them before they vanish forever.

 

[questa]

By the way, EVERYONE who lives in the EU and is owed money by these clowns needs to sue them now before it is too late. It's easier than you think - PM me if you think it is difficult/expensive and i will help you.

 

[Dinahnana]

It's seems that this PL saga is still alive and kicking. Just two quick questions to fellow members at casinomeister:

- does any one know of players who had requested withdrawals prior to the termination of PL's licenses, I.e. 23rd April 2012, and has not received a cent/penny?
- if there are such players, did any of them report such delays to the LGA?

The reason for the above questions is to determine whether the LGA is completely at fault for not assisting players or whether PL' s administration (the uk and ultimately the Malta director) committed a fraudulent act by stating that all players funds had been honored. If the LGA was shown that all players' monies had been paid out AND PL somehow provided evidence that all players' complaints had been addressed (via settlement), than the only fault with the LGA would be that of just relying on information provided by PL.

I don't know what mechanism exists with the LGA to tackle players' complaints...whether they just acknowledged such complaints only or whether they do revert back to the same players informing them of what information would have been collected from the operator.

I requested a withdrawal on April 17th and of course have not been paid. Got the runaround from CS and was told it would take some days to pay me. I didn't think to complain to the LGA at the time now its probably too late. I don't think I will ever see a penny of that withdrawal. I can always hope though!

 

[alfonso07]

On the 23rd of April I had 2 pending withdrawals from Purple Lounge totaling a little over 12k pounds. The first one was at that time exactly 2 months old (has been requested on Feb. 23rd), the other has been requested Mar. 14th. Dates and amounts owed to me have been acknowledged in an e-mail from the casino 'vip manager'.

I didn't contact LGA because I knew they were oblivious to these issues and I didn't think this would get this far.

I know of other players in my situation, having withdrawals which had been pending for weeks before they went down.

my suggestion would be to write to the LGA in an official manner (address i guess would be found on their website) on the basis that as regulator should not have terminated the license and wiped their hands of their obligations at law to protect the players. sending emails seems futile with them, and hence a registered letter or even better couriered, would give you some form of receipt.

in other posts, some bloggers mentioned Small Claims courts etc... i would suggest trying to seek assistance at EU level as there could be tools to report such matters, which would be more accessible to the common mortals.

 

[specialK]

By the way, EVERYONE who lives in the EU and is owed money by these clowns needs to sue them now before it is too late. It's easier than you think - PM me if you think it is difficult/expensive and i will help you.

It's look like you have many PM.

questa has exceeded their stored private messages quota and cannot accept further messages until they clear some space.

Please PM me some info.

 

[jetset]

I requested a withdrawal on April 17th and of course have not been paid. Got the runaround from CS and was told it would take some days to pay me. I didn't think to complain to the LGA at the time now its probably too late. I don't think I will ever see a penny of that withdrawal. I can always hope though!

Questa seems clued up on launching a claim action; I would suggest you and other players who remain unpaid PM him as invited earlier in this thread - it may be worth your while, and the more claims the better imo.

 

[specialK]

Questa seems clued up on launching a claim action; I would suggest you and other players who remain unpaid PM him as invited earlier in this thread - it may be worth your while, and the more claims the better imo.

I wanted to PM Questa, but his messege box is full.

 

[vinylweatherman]

Questa seems clued up on launching a claim action; I would suggest you and other players who remain unpaid PM him as invited earlier in this thread - it may be worth your while, and the more claims the better imo.

Would a "class action" be possible, thus reducing the expense per individual, and pooling the information that each has to paint a better picture.

If so, would this be better at country level, with several being taken, or at EU level, which is bound to take far longer.

Winning a claim is one thing, getting the business to pay up is another. Many consumers have found that intentionally rogue companies are pretty good at ignoring court judgements for payment, and seem to get away with it because the onus is then on the consumer to recover the money, not the court.

I believe some recent changes to court procedure may have made things easier, but I have also read expert opinion that states it won't achieve much in practice.

The gambling license was in Malta, even though the company is based in the UK. The first line of defence PL might try is to have the case dismissed by the UK courts because it should have been brought in Malta. Players may therefore have to seek a ruling that a UK court will hear the claim before bringing it.

In the end, players could be left with pieces of paper, and no money. They need to ensure they cast the net as wide as they can, such as naming Media Corp as co-defendant even though they are making the claim against the PL subsidiary. This makes it harder for companies to "duck and dive", for example by liquidating PL, but keeping the rest of the company alive, and arguing that it is not responsible for PL debts.

 

[questa]

I wanted to PM Questa, but his messege box is full.

Thanks, I emptied it now.

There's no need for class action, just sue them. unless you are owed a giant amount, you can do it yourself and the costs are low.

 

[DiamondGeezer]

Would a "class action" be possible, thus reducing the expense per individual, and pooling the information that each has to paint a better picture.

If so, would this be better at country level, with several being taken, or at EU level, which is bound to take far longer.

Winning a claim is one thing, getting the business to pay up is another. Many consumers have found that intentionally rogue companies are pretty good at ignoring court judgements for payment, and seem to get away with it because the onus is then on the consumer to recover the money, not the court.

I believe some recent changes to court procedure may have made things easier, but I have also read expert opinion that states it won't achieve much in practice.

The gambling license was in Malta, even though the company is based in the UK. The first line of defence PL might try is to have the case dismissed by the UK courts because it should have been brought in Malta. Players may therefore have to seek a ruling that a UK court will hear the claim before bringing it.

In the end, players could be left with pieces of paper, and no money. They need to ensure they cast the net as wide as they can, such as naming Media Corp as co-defendant even though they are making the claim against the PL subsidiary. This makes it harder for companies to "duck and dive", for example by liquidating PL, but keeping the rest of the company alive, and arguing that it is not responsible for PL debts.

Vinyl you are looking into this too deeply. The casino is closed and all players are creditors of Media Corp, who are not co defendants but SOLE defendants. It's just a straightforward case of getting your claim in as Questa says. It's not a difficult process.

As for getting your money it's not certain but unless the total debts are a really big sum then your chances are still very good. And if they do end up in administration you will be above some other creditors in the pecking order as the player funds were supposed to be segregated. Also if they do go into administration someone may buy Media Corp from the administrator and settle the debts. A lot could yet happen but you do need to be pro active and get your claims in.

What worries me is the longer this has gone on the greater the probability the PL debt is big. But then Barclays would not have lent them more money if the debt was huge, unless they have been lied to. Surely the Stock Exchange would not allow them to trade whilst insolvent? But why don't Media Corp announce they are paying the balances???

 

[questa]

The first line of defence PL might try is to have the case dismissed by the UK courts because it should have been brought in Malta. Players may therefore have to seek a ruling that a UK court will hear the claim before bringing it.

In the end, players could be left with pieces of paper, and no money. They need to ensure they cast the net as wide as they can, such as naming Media Corp as co-defendant even though they are making the claim against the PL subsidiary. This makes it harder for companies to "duck and dive", for example by liquidating PL, but keeping the rest of the company alive, and arguing that it is not responsible for PL debts.

Purple Lounge is not a Maltese company.

 

[vinylweatherman]

Vinyl you are looking into this too deeply. The casino is closed and all players are creditors of Media Corp, who are not co defendants but SOLE defendants. It's just a straightforward case of getting your claim in as Questa says. It's not a difficult process.

As for getting your money it's not certain but unless the total debts are a really big sum then your chances are still very good. And if they do end up in administration you will be above some other creditors in the pecking order as the player funds were supposed to be segregated. Also if they do go into administration someone may buy Media Corp from the administrator and settle the debts. A lot could yet happen but you do need to be pro active and get your claims in.

What worries me is the longer this has gone on the greater the probability the PL debt is big. But then Barclays would not have lent them more money if the debt was huge, unless they have been lied to. Surely the Stock Exchange would not allow them to trade whilst insolvent? But why don't Media Corp announce they are paying the balances???

What I find odd is that Media Corp DO have the money, even if not all of it, yet they are trying to distance themselves from liabilty for the debt to players by saying that Media Corp (the parent company) are no longer willing to bail out the failing PL subsidiary. It is a case of having the money, but it being in the wrong "box", and they are not going to pay PL players with money in the "Media Corp box". If Media Corp DID accept that they were liable, they would have paid out players as soon as they made the decision that PL would cease operation. This would have ensured their reputation did not suffer much further damage as players would have their money, and merely be bitching about their favourite casino having closed, whereupon they will be told to find another MGS casino to play at.

It is the failure to grant players closure that is causing the problem, which is escalating rapidly into something that could bring down the whole company.

Suppliers to Media Corp may already be worrying that if players can't be paid, they too will find themselves struggling to get their money. If suppliers pull out, Media Corp could lose things like domain hosting services, and employees may well be secretly searching for more secure employment in anticipation of imminent redundancy, and may move before their jobs are cut. This could lead to an exodus of talent, as it is the best that are most likely to secure employment elsewhere.

Advertisers also may decide to end their contracts, for fear that they will pay, but not get the service because Media Corp runs out of money, and loses it's domain.

Media Corp are still trading as a going concern, so are giving the impression that they are solvent. This makes it even odder that they are not paying players. It seems a case of "won't pay" rather than "can't pay" because they would rather use the money to expand the business than pay debts to players and suppliers. If this is so, a court claim may end up triggering an out of court payment of the amount due in order to avoid adverse judgements appearing on the corporate credit file, which will make it harder for them to borrow, and if they do, rates will be even higher than the current near penal rates Barclays are charging.

We could well see a "rights issue" as a means to raise further capital. This will dilute the value (if any) currently held by existing shareholders. It would probably have to be a "deep discount" issue, and they may struggle to find an underwriter willing to take up rights not taken up by shareholders. They will have to convince shareholders that the money will dig them out of the current hole, and enable them to return to profit.

 

[dunover]

I believe Malta is in the EU anyway so a small claim CAN be filed in the UK, but like people say the holding company would have to be established as liable, ie. mediacorp which is a UK company. IF you file a small claim and win, which you would almost certainly, like vinyl says the problem is getting payment. This is not as hard as it sounds, for 80 pounds (refundable) you can easily get a high court warrant on an unpaid judgement which mean bailiffs will visit the mediacorp registered address and be allowed to seize goods/assets there and then, unless payment in cash or transfer is received immediately. It's just as easy as filing a small claim yourself, and is the next line against recalcitrant payers of your CCJ.
The high court warrant is a tool many people are ignorant of and as a result many persons or companies with CCJ's outstanding either delay payment past the proscribed timescale or not pay at all.

So there are 2 courses of action, either go through your CARD provider (which I would do as is the less circuitous route and is quite clear in law) or file a small claim against mediacorp the holding company. the advantage of the first step is that if card company refused to refund you, you take them to small claims court using the argument I put in the thread i started on cardholders rights. PL has failed in the reasonable expectations of the contract you entered into when making your purchase, so you want a refund from the card company under existing legislation.

The advantage of the first is that if the card company was found to be liable it would in effect become a class action and all card providers would most likely void all payments made to PL by players in the last 6 months who either have held balances at PL or outstanding cashouts.

 

[questa]

Purple Lounge Limited still exists, and has assets. You can claim against them, and bailiffs will be able to visit their very expensive London offices and take the computers and water cooler etc.

 

[DiamondGeezer]

What I find odd is that Media Corp DO have the money, even if not all of it, yet they are trying to distance themselves from liabilty for the debt to players by saying that Media Corp (the parent company) are no longer willing to bail out the failing PL subsidiary. It is a case of having the money, but it being in the wrong "box", and they are not going to pay PL players with money in the "Media Corp box". If Media Corp DID accept that they were liable, they would have paid out players as soon as they made the decision that PL would cease operation. This would have ensured their reputation did not suffer much further damage as players would have their money, and merely be bitching about their favourite casino having closed, whereupon they will be told to find another MGS casino to play at.

It is the failure to grant players closure that is causing the problem, which is escalating rapidly into something that could bring down the whole company.




Media Corp are still trading as a going concern, so are giving the impression that they are solvent. This makes it even odder that they are not paying players. It seems a case of "won't pay" rather than "can't pay" because they would rather use the money to expand the business than pay debts to players and suppliers. If this is so, a court claim may end up triggering an out of court payment of the amount due in order to avoid adverse judgements appearing on the corporate credit file, which will make it harder for them to borrow, and if they do, rates will be even higher than the current near penal rates Barclays are charging.

We could well see a "rights issue" as a means to raise further capital. This will dilute the value (if any) currently held by existing shareholders. It would probably have to be a "deep discount" issue, and they may struggle to find an underwriter willing to take up rights not taken up by shareholders. They will have to convince shareholders that the money will dig them out of the current hole, and enable them to return to profit.

The only reason I can think of why they haven't paid players is they have been trying to sell the customer list to a new operator and the new purchaser needed time to do their due dilligence. Say the debt is £200K for argument's sake, they may be able to sell it on for £1 or they pay the new operator £50K say to walk away from the debt. I can see why initially why they might go down this route. However it has been a month now and any brand value must be rapidly diminishing.

Personally I think it's best to avoid speculation and instead focus on what we do know. Media Corp have raised fresh capital from Barclays and the shares are reasonably stable at 50 pence. Barclays must know what the debt is and so will the analysts broadly. If there was a massive problem then it would be seen in the share price. At the moment it is stable so chances of getting paid are still very good. It's important to note they are a plc so won't be able to ignore the legal process in the way a sole trader or limited company perhaps could. I think the rules about paying court judgements are a lot stricter now. If companies could just walk away from their debts then there would be chaos. If they can't pay people they would be forced into administration, they won't be able to carry on trading. But at the moment they have this new working capital so things look good.

Hopefully they will start the payments voluntarily in the next few days and everybody will get paid. But covering yourself by getting a claim going looks a very sensible thing to do.

 

[specialK]

The only reason I can think of why they haven't paid players is they have been trying to sell the customer list to a new operator and the new purchaser needed time to do their due dilligence. Say the debt is £200K for argument's sake, they may be able to sell it on for £1 or they pay the new operator £50K say to walk away from the debt. I can see why initially why they might go down this route. However it has been a month now and any brand value must be rapidly diminishing.

Personally I think it's best to avoid speculation and instead focus on what we do know. Media Corp have raised fresh capital from Barclays and the shares are reasonably stable at 50 pence. Barclays must know what the debt is and so will the analysts broadly. If there was a massive problem then it would be seen in the share price. At the moment it is stable so chances of getting paid are still very good. It's important to note they are a plc so won't be able to ignore the legal process in the way a sole trader or limited company perhaps could. I think the rules about paying court judgements are a lot stricter now. If companies could just walk away from their debts then there would be chaos. If they can't pay people they would be forced into administration, they won't be able to carry on trading. But at the moment they have this new working capital so things look good.

Hopefully they will start the payments voluntarily in the next few days and everybody will get paid. But covering yourself by getting a claim going looks a very sensible thing to do.

It's stable because nobody wants to buy it.

 

[jetset]

I don't think I would have as much faith in this company as Diamond Geezer appears to have, and waiting for them to come right on this could be leaving things dangerously late, so I am on the same page as him regarding the need for owed players to take action and get claims in now.

Don't forget that failing companies can go south very quickly, leaving everyone holding the can, and the silence from this new management is a very bad sign imo.

Off at a tangent for a moment - just once I would like to see a regulator sued for negligence as well - that might wake them all up

 

[DiamondGeezer]

It's stable because nobody wants to buy it.

Maybe that wave of selling was Vinyl shorting them .

Main thing is they are still alive .

 

[vinylweatherman]

Maybe that wave of selling was Vinyl shorting them .

Main thing is they are still alive .

Tempting, after all, we probably have a different view on what is really happening than the city analysts, who are being fed positive BS.

Somebody bought those shares that are marked as "sell", even though it would have been a broker. The price remained stable in spite of these sales, meaning the broker was happy to be holding these shares in the hope of passing them on at a similar price. If there was no perceived value, any attempt to sell would cause the price to tumble as no broker would want to be on the other end of the transaction, knowing that no-one would be buying. Maybe the 55p valuation reflects the value of current assets that could be realised if the company was broken up and sold in bits. Shares are often valued above the underlying asset value as they represent the future earnings potential and "goodwill" of the brand.

What may rock the boat though is a run of CCJ's being granted because debts to players and suppliers have not been honoured, which would indicate the liquidity situation was far worse than appears on paper (reports, analyst assessments, etc) and company press releases.

The question would be asked as to why these debts were not paid before creditors had to take such drastic action, especially where there can be no question of liabilty. PL have already formally acknowledged the debts to players when sending them the emails about the delays, and that they "would be paid". This formal acknowledgement of the debts by PL means a CCJ in favour of the player is pretty much a certainty. It is not the same as when a casino disputes the debt, such as by quoting a breach of terms, and issues a refusal to pay to the player, which means the court has to determine whether the debt is valid under the terms of the contract before it can issue a judgement.

 

[questa]

Yes, if they exist by the time I get to court, they will have to pay. More likely they will just pay before then to save the total waste of lawyers' fees etc. I offered to let them pay me yesterday and save the hassle, but they did not choose to do so. Now they have to waste time and money responding officially, and will have to pay in the end anyway, plus my costs and interest.

I think it's more likely something will happen by then, either they go bust proper, get sold off, or pay the players.

It's the most bizarre casino situation I ever heard of, a casino with offices and staff having meetings and trading as a company, but not actually doing anything and with no customers Brilliant.

 

[GrandMaster]

Personally I think it's best to avoid speculation and instead focus on what we do know. Media Corp have raised fresh capital from Barclays and the shares are reasonably stable at 50 pence.

I think you mean 0.50p.

 

[DiamondGeezer]

It's the most bizarre casino situation I ever heard of, a casino with offices and staff having meetings and trading as a company, but not actually doing anything and with no customers Brilliant.

Can't understand how they have let things get so far and not taken action sooner. Instead of taking decisions their indecision has been final and their online gaming business has run out of cash. It does seem totally bizarre as you say.

OTOH the remaining business, Eyeconomy, looks to have potential. It looks an interesting business. Once the PL losses have been quantified then Media Corp could be an interesting play.

 

[$97 All in.]

The only reason I can think of why they haven't paid players is they have been trying to sell the customer list to a new operator and the new purchaser needed time to do their due dilligence. Say the debt is £200K for argument's sake, they may be able to sell it on for £1 or they pay the new operator £50K say to walk away from the debt. I can see why initially why they might go down this route. However it has been a month now and any brand value must be rapidly diminishing.

Personally I think it's best to avoid speculation and instead focus on what we do know. Media Corp have raised fresh capital from Barclays and the shares are reasonably stable at 50 pence. Barclays must know what the debt is and so will the analysts broadly. If there was a massive problem then it would be seen in the share price. At the moment it is stable so chances of getting paid are still very good. It's important to note they are a plc so won't be able to ignore the legal process in the way a sole trader or limited company perhaps could. I think the rules about paying court judgements are a lot stricter now. If companies could just walk away from their debts then there would be chaos. If they can't pay people they would be forced into administration, they won't be able to carry on trading. But at the moment they have this new working capital so things look good.

Hopefully they will start the payments voluntarily in the next few days and everybody will get paid. But covering yourself by getting a claim going looks a very sensible thing to do.

I think you mean 0.50p.

That is correct. The shares are half a penny, not 50p. 200 to the £, not 2.

OTOH the remaining business, Eyeconomy, looks to have potential. It looks an interesting business. Once the PL losses have been quantified then Media Corp could be an interesting play.

Several times I've said on here you guys need to read the ADVFN threads for Media Corp & still it seems nobody has. If you had you wouldn't be considering having anything to do with them -

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I wouldn't buy MDC shares with your money, let alone mine.

 

[jetset]

Not even a penny stock LOL.

That's quite a drop from the 52 week high of 2.08

And still no statement from Media Corp or the LGA on the Purple Lounge mess.

 

[DiamondGeezer]

Apologies for the mix up over the share price, maybe it was wishful thinking . But the market cap is £2.8m so they do at least have some value.

The scary thing I read yesterday is that they are talking about launching an odds comparison website called Intabet that they paid £1.5m in shares for. From what I read it sounds like the 'masterplan' is to relaunch PL when Intabet comes on stream, which is not until the autumn. And the really scary part is it sounds like Intabet is going to be run as a brokerage ie Intabet will be holding deposits. It's beginning to look like a scheme to rob Peter to pay Paul. Intabet have burned through £1.2m themselves and now the people behind that are running Media Corp.

$97 All In I agree that Media Corp are totally uninvestible under current management and with so little information about the true picture at PL.

Someone - please call these guys to account before they do more harm to online players.

 

[vinylweatherman]

Apologies for the mix up over the share price, maybe it was wishful thinking . But the market cap is £2.8m so they do at least have some value.

The scary thing I read yesterday is that they are talking about launching an odds comparison website called Intabet that they paid £1.5m in shares for. From what I read it sounds like the 'masterplan' is to relaunch PL when Intabet comes on stream, which is not until the autumn. And the really scary part is it sounds like Intabet is going to be run as a brokerage ie Intabet will be holding deposits. It's beginning to look like a scheme to rob Peter to pay Paul. Intabet have burned through £1.2m themselves and now the people behind that are running Media Corp.

$97 All In I agree that Media Corp are totally uninvestible under current management and with so little information about the true picture at PL.

Someone - please call these guys to account before they do more harm to online players.

Not without FSA approval it won't, unless it moves the business offshore and gives up it's stockmarket listing.

This implies that the "7 days" they keep promising players is going to turn out to be 7 MONTHS!!!

A relaunch of a brand that has been throwing money around, yet has refused to even discuss settling with players of the old PL, is going to fail. I expect it will suffer a boycott from the affiliate side, and will not manage to get seasoned players to return. It will have to rely on naive "newbies".