Serious problems at Purple Lounge

[DiamondGeezer]

Media Corp shares down 20% today .

You do not have permission to view link Log in or register now.

The figures are misleading though, it is more like 10%. The spreads seem enormous on this share.

 

[Spock]

I have spoken to a member by PM who provided me with this link to make a claim against Purple Lounge for monies owed.

You do not have permission to view link Log in or register now.

Some important information:

You must have the following information before you can begin your claim:

full name (including title) of the person(s) you wish to make a claim against

full address (including postcode) of the person(s) you wish to make a claim against

the exact amount you wish to claim (including any interest, where applicable)

details of the claim, ie what it is about

your credit/debit card details

a valid email address

So who exactly am I directing my wrath at?

 

[dunover]

I have spoken to a member by PM who provided me with this link to make a claim against Purple Lounge for monies owed.

You do not have permission to view link Log in or register now.

Some important information:



So who exactly am I directing my wrath at?

Good question, though it may make sense (if applicable in your case) to go down the route of your credit card provider first. Mediacorp may use that defence if you don't, that incorrect procedure has been followed. The card company will know who to go after. On your statements, does it give PL, a payment processor or mediacorp as recipient?

 

[whatever]

...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.

ok, so I finally decided and had some time to file a complaint with the LGA.

The Authority claims that when the licenses of Purple Lounge (Malta) Limited were terminated on the 23rd April 2012 upon the request made by the licensee, they made sure that "there were no pending complaints and that the licensee was compliant with the Remote Gaming Regulations."

So I looked for and read their Remote Gaming Regulations (Link Removed ( Old/Invalid) ) and found art. 12 (4) points (a) and (b) relevant to the current situation. It says:

(a) Where the licensee has sought the approval of the Authority to surrender his licence, the Authority shall not approve same unless it is shown to its satisfaction that the licensee is not in breach of any provisions of the Act, these regulations, any directive issued by the Authority or the conditions of the licence, at the time when such request for approval has been made.
(b) The Authority shall also require evidence that players’ monies have been duly refunded or alternative arrangements in respect of such monies have been made to the satisfaction of the Authority.

Also art. 13 (2) (a) says:

The suspension, revocation or expiration of the licence shall not affect any liability of the licence holder for anything done or omitted to be done before the date of suspension, revocation or expiration.

You can draw your own conclusions!

 

[alfonso07]

Good question, though it may make sense (if applicable in your case) to go down the route of your credit card provider first. Mediacorp may use that defence if you don't, that incorrect procedure has been followed. The card company will know who to go after. On your statements, does it give PL, a payment processor or mediacorp as recipient?

going down the route of the credit card provide might prove futile for the simple reason that when the deposit would have been made, PL would still have had its licenses AND the deposit would have been made by the player through the usage of the provided secure means. say the player deposited in february 2012, wagered all the money and ended with a win, which would have been reported on his/her players' account. at that stage the credit card provider is untouchable as it would have honoured its task - that of providing the facility to deposit. the fact that PL made a runner, subsequently, would be something out of the credit card provider's control.

my suggestion would be to make the claim with the license holder - i.e. purple lounge limited in Malta. irrespective of who owns the shares in this company, the claims would have to be made under the jurisidction of Malta as that is where the company is incorporated. alternatively, the claim would have to be made with PL Malta and PL UK concurrently. the other solution would be to make a claim against the management of PL Malta for fraudulent trading on the basis that they would have provided fraudulent information to the gaming regulator in order to terminate the license AND continued trading when they knew the company was insolvent.

 

[alfonso07]

ok, so I finally decided and had some time to file a complaint with the LGA.

The Authority claims that when the licenses of Purple Lounge (Malta) Limited were terminated on the 23rd April 2012 upon the request made by the licensee, they made sure that "there were no pending complaints and that the licensee was compliant with the Remote Gaming Regulations."

So I looked for and read their Remote Gaming Regulations (Link Removed ( Old/Invalid) ) and found art. 12 (4) points (a) and (b) relevant to the current situation. It says:



Also art. 13 (2) (a) says:



You can draw your own conclusions!

the only conclusion i would see is that the LGA stupidly enough relied on the fraudulent information provided by the management of PL Malta.

 

[dunover]

going down the route of the credit card provide might prove futile for the simple reason that when the deposit would have been made, PL would still have had its licenses AND the deposit would have been made by the player through the usage of the provided secure means. say the player deposited in february 2012, wagered all the money and ended with a win, which would have been reported on his/her players' account. at that stage the credit card provider is untouchable as it would have honoured its task - that of providing the facility to deposit. the fact that PL made a runner, subsequently, would be something out of the credit card provider's control.
my suggestion would be to make the claim with the license holder - i.e. purple lounge limited in Malta. irrespective of who owns the shares in this company, the claims would have to be made under the jurisidction of Malta as that is where the company is incorporated. alternatively, the claim would have to be made with PL Malta and PL UK concurrently. the other solution would be to make a claim against the management of PL Malta for fraudulent trading on the basis that they would have provided fraudulent information to the gaming regulator in order to terminate the license AND continued trading when they knew the company was insolvent.

Not strictly true - indeed that is PART of the transaction, but non payment of winnings accrued can be argued to be non-delivery of goods/services, the argument being that would the Court deem it 'fair and reasonable' that the cardholder could expect his contract with the vendor to be satisfied in full, and that 'full' in terms of a gaming transaction would include payment of winnings......
If winnings aren't paid, if effect the player has played with 'free' test credits and therefore his purchase of REAL chips would be null and void. I think it's a pretty straightforward and watertight argument with the card provider or the County Court. I couldn't see a decision based on 'fairness and reason' (which are the principles of most FSA rulings and consumer protection ) going against the plaintiff.

 

[vinylweatherman]

the only conclusion i would see is that the LGA stupidly enough relied on the fraudulent information provided by the management of PL Malta.

This makes things even worse for PL. In order to have successfully surrendered the license, they would have had to PROVE that all players had been paid, or that an alternative arrangement had been put in place. Clearly neither has happened.

It could also mean that the LGA failed to follow it's own rules, and allowed the surrender without any evidence that players had been paid. This could open the door to suing the LGA!

 

[jetset]

It is beginning to look like another case of this regulator not checking that the information provided to it by the operator/licensee was correct.

All the more reason for owed players to apply pressure by submitting claims against the company imo.

Regarding who to claim against, I hope we are not over-complicating this aspect to the extent that we discourage owed players from lodging complaints...it seems to me that Alfonso's suggestion that Purple Lounge's Maltese company is the logical target makes sense - that company, through its Malta licence, legitimised operations and was directly responsible for compliance with all the obligations of an LGA licensee - including financial regulations.

At the rate Media Corp shares are headed south, with the company management apparently mesmerised and tongue-tied by the problems, this company's future has to be in the balance.

 

[rainmaker]

LONDON--(BUSINESS WIRE)--

31 May 2012

Media Corporation Plc ("Media Corp" or the "Group")

Purple Lounge Trading Update​

Following the acquisition of Intabet Limited, announced on 16 May 2012, Adam Fraser-Harris and Phil Jackson were appointed Interim CEO and Chairman respectively immediately following the departure of Justin Drummond (Previous Executive Chairman) and Sara Vincent (Previous MD of Purple Lounge and Interim CEO of Media Corporation). Since their appointment, Adam and Phil have been conducting a strategic and financial review of the enlarged Group.

It has become clear during the review that the financial and trading position of the Purple Lounge division is no longer tenable due to historic operational and financial failings within the business. Accordingly, it is with regret that the Board announces that it has made all of the staff within that division redundant and will be instructing lawyers to file the relevant documentation to put the relevant companies into liquidation.

The Board will specifically request that the appointed liquidators look into the financial arrangements within the Purple Lounge group of companies and to review the position as to player funds.

The Board regrets any corporate failings in the past and seeks to assure shareholders that it is exploring routes to try, in some way, to mitigate the expected player losses, though this is against a background where the Group has loaned well over £1m to the division since its acquisition in October 2009. The Board does not believe that the Group will incur any further liabilities in respect of Purple Lounge over and above the realisation of the above loan.

Notwithstanding the difficult decision it has made, the Board believes that it can put the poor trading of Purple Lounge behind it and will be working to bring the Group back to profitability, as quickly as possible.

Further announcements will be made as and when appropriate.

Contacts: Media Corporation Plc Tel: +44 20 7618 9000
Phil Jackson – Chairman
Adam Fraser-Harris – Interim CEO
Northland Capital Partners Limited Tel: + 44 20 7796 8800
Luke Cairns / Rod Venables (Nominated Adviser)
Katie Shelton (Joint Broker)
XCAP Securities Tel: + 44 207 101 7070
Jon Bellis / Karen Kelly (Joint Broker)
Bishopsgate Communications Tel: + 44 20 7562 3350






Media Corporation PLC

Source: Media Corporation PLC

 

[DiamondGeezer]

WTF???

 

[whatever]

The Board regrets any corporate failings in the past and seeks to assure shareholders that it is exploring routes to try, in some way, to mitigate the expected player losses, though this is against a background where the Group has loaned well over £1m to the division since its acquisition in October 2009. The Board does not believe that the Group will incur any further liabilities in respect of Purple Lounge over and above the realisation of the above loan.

Can somebody explain what this means? I read it like 5 times and I can't understand...

Who's paying the bill? Is it the players or the shareholders?

 

[incrediblestuff]

I am just reading this, since it wasn't really of interest before, as i never dealt with the purple lounge group, however, since they were well accredited and known for a long period, and the length and visibility of the thread i thought there must be some interesting facts>
After reading it i came to the conclusion its very peculiar, that such a happenstance could occur, during a takeover, or shortly after, cause surely when you aquire a business you will let your legal staff and financial advisors collect these data before you decide to buy it, also if you decide to buy it, and are clear on the standing of the operation, you would immediately be as transparant as possible to all partners and/or customers.
If you decide not to, and then come out with such an unclear legally covered statement, its alarming, and one would ask themselves if this is truly done with pure intent.
I might be seeing things, and ofc i went to the LGA site, to check what regulations there should be or were/are, in terms of such a case.
However most of their site is "service unavailable"
Not really reassuring.
I'll say it now and i've said it before: big banks, companies and even governments can fall as easily as 1,2,3, just goes to show, we all should be on our toes all the time, and thank god for the forums and the internet, to keep us there.
I hope im making sense
Good luck to all the duped people, i hope they will see some of their money back.

Edit:

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 - Old / Expired Link

This is likely because most of the people browsing forums dont want to sign up at some banner filled site to get some info that they do not necessarily need, i clicked and didnt bother either.

 

[Mousey]

The Authority claims that when the licenses of Purple Lounge (Malta) Limited were terminated on the 23rd April 2012 upon the request made by the licensee, they made sure that "there were no pending complaints and that the licensee was compliant with the Remote Gaming Regulations."

Then something went wrong at the LGA... the licensee was broke... insolvent? ... had no money?.... how could that be compliant with gaming regulations??

The Board regrets any corporate failings in the past and seeks to assure shareholders that it is exploring routes to try, in some way, to mitigate the expected player losses, though this is against a background where the Group has loaned well over £1m to the division since its acquisition in October 2009. The Board does not believe that the Group will incur any further liabilities in respect of Purple Lounge over and above the realisation of the above loan.

Gawd... I hate corporate-speak as much as lawyer-speak.... I have a vague idea what they're saying, but don't want to 'translate' as I might be wrong.

I do think Jetset has it right, though. If any of you have legitimate claims for money owed, do something, file with someone, somewhere - be it small claims court or whatever -- do it now!

 

[DiamondGeezer]

They are attempting to liqidate PL leaving players to suffer losses. Basically they are claiming it is nothing to do with Media Corp.

This is the sort of thing companies used to do a lot in the 1960's. You set up a main company and a subsiduary and with financial engineering you run the subsiduary at a big loss with the profits ending up at the main company. Then when you have enough loss in the subsiduary you liquidate it. This sounds like what Media Corp are planning to do.

However it's my understanding this practise has been outlawed. Put it this way if it hasn't it would happen a lot more and you don't hear about it nowadays. Think it used to be called a 'Long Firm' in the 1960's.

So now all claimants need to go after Media Corp, which personally I always thought was the logical choice all along. But the worry is maybe they have an angle I have not considered that can get them off the hook. But the only good thing I can say is you have very little to lose by claiming and a lot to gain. Also if one person wins everybody will win.

Can't believe they have done this. Personally I think it's fraud if players suffer losses because the player accounts were segregated under the LGA rules.

 

[DiamondGeezer]

This is from the 2009 archive on the Media Corp website:

Media Corporation plc, a leading AIM quoted advertising network and Internet publishing group, is pleased to announce that it has acquired the entire share capital of Purple Lounge Limited ("Purple Lounge"), an internet gaming company.

Being the 100% owner should simplify things.

 

[whatever]

They are attempting to liqidate PL leaving players to suffer losses.

I called them to have that statement translated in proper English and it appears you are right. PL is being passed in the hands of the liquidators, who will see who gets what, if anything.

 

[questa]

Incredible.

There must be someone who can comment knowlegably on whether MDC are allowed to do this. And whether they can in fact be pursued, rather than the now defunct PL Ltd. I'm no expert, to be fair.

 

[dunover]

Now you DO have an absolutely valid claim from your card company, as insolvency of vendor leading to non-provision of goods/services is specifically covered.

 

[jetset]

This is what I mean about companies going south quickly, yet I am flabbergasted that these new guys have behaved in such a cynical and perhaps highly questionable manner. It certainly explains their refusal to discuss this issue with the players, whom they probably knew they were going to shaft the whole time; as another poster had already noted, they must have known from their due diligence exactly what the position was at an early stage, and withholding the true situation from the players by both former and present management places a huge question mark over this company and the conduct of its executives.

I think that ought to be actionable.

The wording of that statement will clearly do little for the previous management's reputation, not that I am overly concerned about that, given the behaviour of Drummond and Vincent in recent times.

I'm not surprised that the LGA website was so conveniently inoperable earlier today, either - they have little to be proud of in this mess.

I think players need to get claims in to the liquidators as soon as they are announced, stressing the licence requirement that funds should have been segregated, which I think should make the previous management personally liable if it was not done, as appears to be the case from these statements.

This is truly a shocking decision by messrs Adam Fraser-Harris and Phil Jackson, and I wonder what will now happen to the already seriously mauled share price - ironically it may improve given this cynical dumping of PL and its losses...it can't go much lower!

 

[jetset]

Now you DO have an absolutely valid claim from your card company, as insolvency of vendor leading to non-provision of goods/services is specifically covered.

Yeah, but surely the "goods" have already been delivered/provided - it's the reward that is missing!

I do take your point, however - maybe chargebacks in this sort of situation are a quick and easy response, especially if the company has been playing fast and loose with its regulatory requirements (segregation etc).

 

[dunover]

Yeah, but surely the "goods" have already been delivered/provided - it's the reward that is missing!

I do take your point, however - maybe chargebacks in this sort of situation are a quick and easy response, especially if the company has been playing fast and loose with its regulatory requirements (segregation etc).

I covered that one yesterday:

"Not strictly true - indeed that is PART of the transaction, but non payment of winnings accrued can be argued to be non-delivery of goods/services, the argument being that would the Court deem it 'fair and reasonable' that the cardholder could expect his contract with the vendor to be satisfied in full, and that 'full' in terms of a gaming transaction would include payment of winnings......
If winnings aren't paid, if effect the player has played with 'free' test credits and therefore his purchase of REAL chips would be null and void. I think it's a pretty straightforward and watertight argument with the card provider or the County Court. I couldn't see a decision based on 'fairness and reason' (which are the principles of most FSA rulings and consumer protection ) going against the plaintiff. "

What do you reckon?

 

[DiamondGeezer]

Incredible.

There must be someone who can comment knowlegably on whether MDC are allowed to do this. And whether they can in fact be pursued, rather than the now defunct PL Ltd. I'm no expert, to be fair.

In some ways this is a good development in that the speculation is at an end and things are now a lot clearer. Taking action against Media Corp was the only realistic chance of recovering monies since it was obvious PL had run into serious financial trouble.

This is a situation that happens so often in business and has happened thousands of times before. I think the best thing to do is to see a solicitor and they will be able to tell you if you can go forward and recover the money against Media Corp, who after all are the sole owners of PL and the ones liquiditating them. If a few of you club together you could get some good legal advice, maybe even pay a few hundred for a legal opinion from a barrister.

It's quite possible they are doing this to stall for time and are fully aware of their liabilities but simply trying to avoid them. At least you should know quickly what the situation is.

 

[DiamondGeezer]

Anyone in the industry like to guess the amount owed to players???

If for argument's sake you accept PL was a seperate entity, if the player balances have gone missing the company must have been fraudulently trading. They would have been trading whilst insolvent which is a criminal offence.

 

[questa]

I think the situation is now hopeless, sadly.

Action against MDC will simply be met by the response that it is PL Ltd that is liable.

Just a question of filiing with the liquidator and writing it off now I'm afraid.

Also, you cannot segregate casino balances, because if someone deposits £1 and wins £100000 only the £1 could have been segregated anyway.

Maybe players went on a winning streak.

 

[vinylweatherman]

Media Corp still intend to launch an online gambing business.

One possible response to this could be a mass boycott of any new online gambing business Media Corp own, or acquire. This could be effected by affiliates sticking together and boycotting any Media Corp venture, even automatically roguing them as soon as they launch. Players too could boycott by refusing to sign up, and could even boycott affiliates who decide to promote Media Corp businesses.

They did it once, so what's to stop them pulling the same stunt again if Intabet runs into problems after launch.

EU based regulation did not help the players, so if the new Media Corp businesses decide to have an LGA license, it does not matter what requirements to keep player funds separate are made, there is no enforcement.

Since the requirement DID exist, there is a case for a criminal investigation of the former directors for fraudulently using supposedly segregated player funds to keep the business afloat. They also fraudulently misrepresented the situation to the LGA in order to keep their license until they had used up their own, and players', funds in an effort to turn things around.

I would also expect the liquidator to look into how supposedly segregated funds disappeared without the LGA noticing, and trace where they went. If the funds left the company, they can be recovered if they still exist.

This situation seems very similar to the Full Tilt saga.

The rest of the industry should speak out against this kind of behaviour, as it has destroyed the faith players have that their funds are safe.

Unlike other failures, where the entire company has gone down, Media Corp have segregated the profitable parts from the loss making PL division, so that they can cut it loose whilst ensuring their own corporate pockets are lined at the expense of players and staff at the PL division. Now that the have been thrown out of work, PL staff should consider "blowing the whistle" if anything dodgy or illegal was going on that lead to this situation. They would be protected by the UK "whistleblowers charter", which indemnifies employees that speak out about illegal actions by their employers. With the internet, they can retain a degree of anonymity by using an alias, but having their position as former employee verified by a trusted member of the online community.


There is a precedent to such a mass boycott, and it was when Grand Prive decided to screw over the entire affiliate community. I expect affiliates who were promoting PL are never going to see their money either unless it has already been paid out. These affiliates may also have spent fruitless efforts in recent months under the false impression that PL was a going concern, and would be around for some while.

This is also yet another reminder that the idea that MGS casinos are somehow safer because of this MYTHICAL guarantee that MGS themselves will ensure players see their money if an operator collapses is, and never has been, true.

MGS themselves may have unpaid licensing fees and royalties that they will probably never see.

In future, the slightest indication that things are going wrong should be taken seriously, and any assurances from the operator that something is a "minor technical issue" should not be taken at face value.

Other operators themselves should be careful about keeping issues hidden from players, and should explain more about an actual issue, rather than the bland "we are working on it" which so far this year has translated as "we are going under".

 

[jetset]

It's certainly going to be interesting to hear what stories the retrenched staff members will inevitably have to tell - one has to wonder how many fairy tales they were told about the security of their jobs before suddenly being made "redundant".

I agree that this issue cries out for deeper investigation - there are many very troubling aspects to the manner in which this enterprise was operated, and serious questions to be answered by the regulator.

Boycotts are difficult to institute and maintain, but players and affiliates should make a point of remembering this sorry-ass affair and resurrect it if this company again tries to launch future online gambling enterprises imo.

In the meantime I would urge players not to abandon the idea of submitting claims - nothing ventured, nothing gained.

 

[whatever]

I also think nothing good can come out of this any more!

Certainly some kind of fraud had been going on. The new management probably wants to have nothing to do with it so they passed the company into liquidation. They already mentioned expected player losses.

The regulatory body proved to be incompetent at best and has clearly stated on its website that it will not assist players.

To see this go down as it did marks a very dangerous precedent. The truth is, in a time when people are worried about their money in banks, you are naive to think gambling industry can be safe... or decent. And we all know a fool and his money are soon parted. This is what this industry is all about unfortunately and I don't mean to offend anyone.

I am willing to share a percentage of my claim (12220 pounds) with a lawyer in London who can successfully represent me. As I stated previously, I have an e-mail from them confirming the amount owed. Maybe you can recommend me someone who dealt with cases like these.

 

[vinylweatherman]

Maybe the growing risk of court action is what forced their hand, and made them announce this move now, at what seems to be a sensitive time having just paid out in shares for Intabet. Those Intabet shareholders who accepted Media Corp shares may feel they too were lied to in the offer document, and if Media Corp shares head south due to this announcement, these former Intabet owners may feel that deliberately keeping quiet about the state of PL until the deal went through was fraud, and could ask for an investigation by the LSE.

I suspect many investors saw this deal as injecting the capital needed to dig PL out of it's hole, and at least manage to sell it on as a going concern with players' balances transferred as part of the deal.

Even if this move succeeds, the PR fallout itself could put a dent in the future prospects for Media Corp and Intabet, as to make profits they need customers.

Do they expect those players who got screwed after trusting PL and the LGA to segregate their funds to trust the new Intabet to segregate any funds held, and the regulator to make sure this happens.

UK players could also put pressure on the Government via their MP's, as it is a fellow EU state government that failed to protect them by following their own rules. It could ensure the government take another look at the forthcoming tightening of the regulations, because it would be highly embarrassing if such an event ocurred AFTER the new regime was in place.

The real shocker is that this was no rogue "clip joint" run from some dodgy jurisdiction, it was a well regarded operator operating within the EU with the parent company being UK based and listed on the LSE. If an operator with such credentials cannot be trusted, then surely noone can.


Luckily, I quit PL soon after they were bought by Media Corp, and posts here appeared about players having random account closures purely for winning too much, and an increase in "spirit of the bonus" cases that ultimately lead to them leaving the accredited section.


I later got a phonecall from a charming rep under the new ownership who wanted to know what it would take to get me playing again. I told her, and eventually they DID mend fences between themselves and CM and reapply for accreditation. They seemed to be going OK, but I am often reluctant to play where I have gone well ahead, and in this case it was partly down to the lingering impression that those who win too much get their accounts closed without notice.

Luckily, I held out beyond March this year, when the posts about payment delays and BS excuses began to appear. I could easily have had a 10K+ win off the fruities disappear into the black hole of liquidation. Luckily, this win was diverted to be from GNUF, and I got paid.

 

[DiamondGeezer]

Really sorry for everyone involved but it's not looking good unfortunately.

I found what someone else had researched and read this. What it is saying is that a subsiduary has a seperate legal identity to the parent company. In legal speak it is known as the corporate veil (of identity). It seems that unless you can prove fraud you can't go after the parent company for losses at the subsiduary. To me this seems harsh and unfair. I was thinking people could go after Media Corp in the name of justice but it seems that this is not a valid reason.

I also read that the segregation of balances is a regulatory requirement but crucially not an accounting standard. So you couldn't easily use the segregated balances requirement to claim fraud.

So right now it does not look like you have much of a chance claiming against Media Corp unless you can somehow lift the veil of PL having a seperate corporate identity. I feel bad about being bullish earlier now so sorry about that:

The Current State of the Law

21. The courts are now increasingly reluctant to lift the veil in the absence of a sham. In
particular, it is clear that the veil will not be lifted simply because it would be in the
interests of justice. In Adams v. Cape Industries plc21 the Court of Appeal was
unequivocal on this point. Slade LJ said22:

“Save in cases which turn on the wording of particular statutes or contracts, the
court is not free to disregard the principle of Salomon v. Salomon & Co Ltd
[1897] AC 22 merely because it considers that justice so requires. Our law, for
better or worse, recognises the creation of subsidiary companies, which though in
one sense the creatures of their parent companies, will nevertheless under the


general law fall to be treated as separate entities with all the rights and liabilities
which would normally attach to separate legal entities.”

 

[fastriffs]

I went to some random local solicitor today in london, and he basically told me without looking to much into the case that if it was LTD company then i cant do anything about it. Its pointless to try and get anything back from the parenting company cause they do not hold legal responsibility for it. This is ridiculous, how easy is to legally steal other people's money.

 

[Mousey]

I went to some random local solicitor today in london, and he basically told me without looking to much into the case that if it was LTD company then i cant do anything about it. Its pointless to try and get anything back from the parenting company cause they do not hold legal responsibility for it. This is ridiculous, how easy is to legally steal other people's money.

This is all so sad... It is so damned frustrating to sit here and basically watch a business that is 'regulated' and 'licensed' close the doors with absolutely no warning to players and get by with 'oops! our bad!' and go on with their sellouts and trades and whatever else the 'parent' co. wants to do with it.

The regulators regulate NOTHING, they oversee NOTHING, the don't look after anyone's best interests but their own. A business implodes, players/members are owed monies but, by golly, that's just tough and no one anywhere is responsible for that business screwing over players.

It's a stinking, rotting mess, and it makes me sick.

 

[$97 All in.]

Can somebody explain what this means? I read it like 5 times and I can't understand...

Who's paying the bill? Is it the players or the shareholders?

A rough translation in layman's terms is your are fecked & your money is gone.


TBH I don't think players have much of an argument against the new management, shooting them is like shooting the messenger bearing bad news.

This didn't happen overnight & had been brewing for years, if you believe the angry & frustrated shareholders who commented on Media Corp in financial forums. The true bad guys & the people 100% responsible for this clusterfuck are Justin Drummond, his brother Jason Drummond & Sara Vincent who over an extended period of time mismanaged the company & mismanaged your funds & ran PL into the ground, all the time being paid absurdly well for utter failure. Justin Drummond got paid over a quarter of a million Pounds last year, some £50k of which was a bonus!

I can understand what the new management are doing. They have taken over a bombed out company that was mismanaged & run into the ground by the 3 named above & are now trying to salvage what they can. I reckon it's a forlorn hope & everybody is going to lose here, shareholders, staff & the banks who foolishly lent them money.

I just wish Justin Drummond, Jason Drummond & Sara Vincent could lose more than they are going to, which is whatever reputation they had left in the City. At least their cards are marked now for the future & everyone knows them for the rogues, cheats & liars they are.

 

[specialK]

You do not have permission to view link Log in or register now.

Dear player,

We are sorry to inform you that following a strategic and financial review of the Media Corporation Group it has become clear to the new board that the position of Purple Lounge was no longer tenable due to the historical operational failing and trading losses.

Accordingly, the board are instructing lawyers to apply to the courts to appoint a liquidator to the relevant companies within the group.

For more information, please read the Player FAQ’s or Supplier and Creditor Information.

Regards,

Purple Lounge

You do not have permission to view link Log in or register now.

When the liquidators will be appointed?

The directors of the relevant company have to go through a process of applying to the courts in order to appoint a liquidator. We cannot give a fixed date as it is process and court dependent, but it will hopefully be within the next few weeks.

Where can I find the liquidators contact details?

We will publish the liquidators contact details on this page when they are appointed.

When will I get my money back?

We can’t comment on when or if you will receive your money back as that is down to the liquidators as they perform the liquidation process.

Will I get my full balance back?

We can’t comment on how much you will receive back from your Purple Lounge account; this will be down to the liquidators as they perform the liquidation process.
Is there anybody I can speak to?

Unfortunately, this is all the information available currently and there is nothing else they would be able to add at this time.

Is there anything I can do?

If you would like to make a claim with the creditors, please email [email protected] and we will supply you with contact information for the creditors when they are appointed.

 

[ChopleyIOM]

Has there been any word whatsoever from MG about this?

One single thing?

 

[DiamondGeezer]

Just about the only hope players have is that it didn't get too out of hand and the total of the player balances is not too high. The movement from Microgaming to Entraction must have prompted a lot of players to cash out at least. I have no idea what the player base was at the end, I read the other day on the Media Corp website that they claimed PL had 120000 players.

I find the whole episode really creepy and spooky. I had a few nice wins there and the service was always good. I always regarded them as a top brand. It's amazing how fast things can turn.

This is like a blind man's chance but is there any hope the amount of missing funds is infact quite modest? There still may be a chance someone will buy PL off the liquidator. They must have a good customer list the brand was always well marketed IMO. It would be great publicity for the purchaser cover the debt. If it's say £200K that would be a good deal for all the positive publicity. PL must have a few whales on their books and this type of customer is very hard to find. For PP, WH, Lads, Betfred and VC this is but a pittance. Guys there is a fallen soldier here, do a good turn for the industry and step up to the plate.

With offshore US facing sportsbetting there is almost no regulation with most of the companies based in Costa Rica which is effectively unregulated. But instead of taking the micky the firms down there self regulate. If a sportsbook fails (and plenty have) one of the big boys will pick up the tab and the player balances all get moved accross with a rollover attached. Basically the players take a bit of a haircut but they get to keep nearly all their balance. They won't bail out fraudsters but a genuine book in difficulty is always accommodated, which is how I see PL, a genuine operation come accross hard times. If someone out there shows a bit of imagination why can't the balances be moved accross with a rollover/wager requirement? Shouldn't this industry show a bit of decency and come together over this?

Malta - I'm sick of getting f**ked up the arse with Malta!!! If Malta can't or won't regulate the big companies have got to come together and self police online gaming. If something doesn't happen soon about Malta then it's going to affect online gaming really badly and everyone will lose.

 

[GrandMaster]

I covered that one yesterday:

"Not strictly true - indeed that is PART of the transaction, but non payment of winnings accrued can be argued to be non-delivery of goods/services, the argument being that would the Court deem it 'fair and reasonable' that the cardholder could expect his contract with the vendor to be satisfied in full, and that 'full' in terms of a gaming transaction would include payment of winnings......
If winnings aren't paid, if effect the player has played with 'free' test credits and therefore his purchase of REAL chips would be null and void. I think it's a pretty straightforward and watertight argument with the card provider or the County Court. I couldn't see a decision based on 'fairness and reason' (which are the principles of most FSA rulings and consumer protection ) going against the plaintiff. "

What do you reckon?

I don't see a court upholding this view, but if it does get upheld, credit card issuers won't allow their cards to be used at casinos, since they don't want to be responsible for paying you if you hit a jackpot and the casino won't pay.

 

[questa]

Just about the only hope players have is that it didn't get too out of hand and the total of the player balances is not too high. The movement from Microgaming to Entraction must have prompted a lot of players to cash out at least. I have no idea what the player base was at the end, I read the other day on the Media Corp website that they claimed PL had 120000 players.

I find the whole episode really creepy and spooky. I had a few nice wins there and the service was always good. I always regarded them as a top brand. It's amazing how fast things can turn.

This is like a blind man's chance but is there any hope the amount of missing funds is infact quite modest? There still may be a chance someone will buy PL off the liquidator. They must have a good customer list the brand was always well marketed IMO. It would be great publicity for the purchaser cover the debt. If it's say £200K that would be a good deal for all the positive publicity. PL must have a few whales on their books and this type of customer is very hard to find. For PP, WH, Lads, Betfred and VC this is but a pittance. Guys there is a fallen soldier here, do a good turn for the industry and step up to the plate.

With offshore US facing sportsbetting there is almost no regulation with most of the companies based in Costa Rica which is effectively unregulated. But instead of taking the micky the firms down there self regulate. If a sportsbook fails (and plenty have) one of the big boys will pick up the tab and the player balances all get moved accross with a rollover attached. Basically the players take a bit of a haircut but they get to keep nearly all their balance. They won't bail out fraudsters but a genuine book in difficulty is always accommodated, which is how I see PL, a genuine operation come accross hard times. If someone out there shows a bit of imagination why can't the balances be moved accross with a rollover/wager requirement? Shouldn't this industry show a bit of decency and come together over this?

Malta - I'm sick of getting f**ked up the arse with Malta!!! If Malta can't or won't regulate the big companies have got to come together and self police online gaming. If something doesn't happen soon about Malta then it's going to affect online gaming really badly and everyone will lose.

200k are you mad?

Just the few folk I know are owed more than that.

There are MILLIONS missing here. Maybe 10s OF MILLIONS.

 

[whatever]

I know of another 100k at least...

 

[specialK]

We all are talking that is fraud, crime etc. But did anyone inform police, London Stock Exchange or any relevant institutions?
I don't know which instition should deal with it, but we can't expect that they are reading this forum, and take action by themself.

 

[vinylweatherman]

I don't see a court upholding this view, but if it does get upheld, credit card issuers won't allow their cards to be used at casinos, since they don't want to be responsible for paying you if you hit a jackpot and the casino won't pay.

I believe only the deposit are covered, not the winnings. This may be why there has been an almost universal shift among UK card issuers to treating gambling transactions as "cash advance" rather than "purchase". This means the card issuer would NOT be jointly liable as they would be for a "purchase". It seems the banks were already aware that online gambling operators were too high a risk to allow joint liabilty under the consumer credit act to apply, so found a legal way to remove this responsibilty.

Those players that used a card that treated their PL deposits as purchases DO have a chance to make a claim now that the company has been formally wound up.

This IS already affecting the rest of the industry, as in the thread about JF no longer flushing withdrawals, the recent revelation that they have now gone to 48 hour pending from 24 hours has had one player thinking this is a warning sign, and that players should heed it BECAUSE this is all the warning we got from PL when things first started to slip, and those that didn't heed those early signs are the ones that got screwed. This is the FIRST time I have seen a move to 48 hour pending taken as a warning that a group is about to implode.

Operators therefore need to tread carefully, the player community is not in the mood for even minor bad news, no matter how reputable the operator.

 

[DiamondGeezer]

200k are you mad?

Just the few folk I know are owed more than that.

There are MILLIONS missing here. Maybe 10s OF MILLIONS.

£200K was just a pure guess. It was based on what I read from the P&L last year when they lost £900K. I was thinking as a ratio of this then say £300K would be plausable. Without knowing the working capital balances of the company it is impossible to guess really but I was assuming MG had controls in place so that the player balances (excluding progressives) would have to be in some sort of ratio to the cash at bank. So for example the total player balances could be allowed to run up to twice the cash at bank.

Or to put it another way they've been taking the losses to the P&L and were losing £75K a month, so how could a player balance shortfall escalate to a figure greater than four months average loss say?

What I am trying to say is that there must be certain fundamental ratios they must have to adhere to regarding working capital. If what you say is anywhere near true then it raises the question of were they trading whilst insolvant?

Personally I can't see how they could have missing player funds of more than six months losses. A million missing would be more than a whole year's losses.

Anyone that does have a belief that missing funds are on this scale ought to be contacting the SFO.

 

[fastriffs]

Icalled the LGA now, wanted to ask what is the purpose of their organisation. And eventually asked about the purple lounge. They confirmed that the players funds where suppose to be segregated, and ATM they are working on this.

 

[specialK]

Come on. Players funds weren't segregated, if they were, purple lounge wouldn't have problems with withdrawals.

 

[fastriffs]

....

 

[specialK]

It wasn't answer to your post. I just had impresion that some hoped that they kept in segregated.

 

[whatever]

Icalled the LGA now, wanted to ask what is the purpose of their organisation. And eventually asked about the purple lounge. They confirmed that the players funds where suppose to be segregated, and ATM they are working on this.

I called too asking about my complaint from 2 days ago and I've been told the manager is on leave until Wednesday

I think they have a bowl with fortune cookies on their desk... but with excuses... one for every phone call!

 

[questa]

£200K was just a pure guess. It was based on what I read from the P&L last year when they lost £900K. I was thinking as a ratio of this then say £300K would be plausable. Without knowing the working capital balances of the company it is impossible to guess really but I was assuming MG had controls in place so that the player balances (excluding progressives) would have to be in some sort of ratio to the cash at bank. So for example the total player balances could be allowed to run up to twice the cash at bank.

Or to put it another way they've been taking the losses to the P&L and were losing £75K a month, so how could a player balance shortfall escalate to a figure greater than four months average loss say?

What I am trying to say is that there must be certain fundamental ratios they must have to adhere to regarding working capital. If what you say is anywhere near true then it raises the question of were they trading whilst insolvant?

Personally I can't see how they could have missing player funds of more than six months losses. A million missing would be more than a whole year's losses.

Anyone that does have a belief that missing funds are on this scale ought to be contacting the SFO.

I know of two people with not far off 100k between them. That's just two poker players.

 

[jetset]

Really sorry for everyone involved but it's not looking good unfortunately.

I found what someone else had researched and read this. What it is saying is that a subsiduary has a seperate legal identity to the parent company. In legal speak it is known as the corporate veil (of identity). It seems that unless you can prove fraud you can't go after the parent company for losses at the subsiduary. To me this seems harsh and unfair. I was thinking people could go after Media Corp in the name of justice but it seems that this is not a valid reason.

I also read that the segregation of balances is a regulatory requirement but crucially not an accounting standard. So you couldn't easily use the segregated balances requirement to claim fraud.

So right now it does not look like you have much of a chance claiming against Media Corp unless you can somehow lift the veil of PL having a seperate corporate identity. I feel bad about being bullish earlier now so sorry about that:

The Current State of the Law

21. The courts are now increasingly reluctant to lift the veil in the absence of a sham. In
particular, it is clear that the veil will not be lifted simply because it would be in the
interests of justice. In Adams v. Cape Industries plc21 the Court of Appeal was
unequivocal on this point. Slade LJ said22:

“Save in cases which turn on the wording of particular statutes or contracts, the
court is not free to disregard the principle of Salomon v. Salomon & Co Ltd
[1897] AC 22 merely because it considers that justice so requires. Our law, for
better or worse, recognises the creation of subsidiary companies, which though in
one sense the creatures of their parent companies, will nevertheless under the


general law fall to be treated as separate entities with all the rights and liabilities
which would normally attach to separate legal entities.”

This is quite staggering when you take into account that the shots at Purple Lounge were being called by the knob in charge at Media Corp, both when Sara Vincent was there as notional md and subsequent to her appointment as interim CEO of Media Corp.

This is truly disgraceful, and very frustrating to think that these white collar incompetents may get away with it.

It does cement one perception, though - the LGA is utterly useless from a player point of view and has zero credibility.

 

[DiamondGeezer]

Questa,

The response on the 2+2 poker forum seems relatively muted however, with a number of players saying they became suspicious when PL offered them overly generous rakeback deals. Ofcouse it's always hard to gauge what people are saying in public and the true picture could be very different.

The last set of accounts PL fired can be seen in summary here:

Link Removed (Old/Invalid)

The total current liabilities at 30/09/2010 were £212,285 and the player balances would have fallen under this being trade creditors. Ofcourse so much could have happened since but at that point the liabilities figure looks reasonable.

All I am really saying is if there is a MASSIVE amount of money owed then it would have been apparant for a long time when you look at the historical levels.