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wow....I sincerely hope they don't expect to make any 'profit' from anyone who has heard about this mess.
Serious problems at Purple Lounge
- Thread starter rahmanrumel
- Start date
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- payouts
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- Oct 14, 2004
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- United Kingdom
They should be investigated as this sounds like contrived trading, rather than a genuine sale and later purchase of assets. Could be a tax fiddle, or even another way to screw customers by repeatedly moving the assets to make it hard to chase up redress.
They have already screwed PL players, staff, and suppliers, yet seem to have plenty of money to buy and sell other assets, yet seem unwilling to proceed with appointing liquidators to wind up PL and bring closure a step closer for those affected.
It makes me wonder whether PL is really going to go bust, or is being used as another way to perhaps manipulate the tax system, or screw even more customers.
Once liquidators have been appointed, PL as an asset will be sold, broken up if necessary, in order to raise the most money possible for creditors. Whoever buys it will have a player database, and a chance to win those players back by doing what PL should have done and restore their balances as part of the deal. By hanging on, Media Corp are also hanging on to the player database, keeping it out of the hands of a potential competitor. They may also have a tax write-off to use at the end of the tax year. They could even reflate it with just enough capital to avoid liquidation, and then do a similar sell and buy back.
If they delay, it is also possible for creditors to get a winding up order, which means liquidators will be appointed by the court, rather than by the board of Media Corp.
If PL hang on and eventually restore the player balances, it will still mean players will have lost the use of their money, as well as any interest. Although Media Corp doesn't have the money, they have saved themselves money by using these player funds, rather than their own, in shoring up PL for as long as they did before giving up the struggle.
They have already screwed PL players, staff, and suppliers, yet seem to have plenty of money to buy and sell other assets, yet seem unwilling to proceed with appointing liquidators to wind up PL and bring closure a step closer for those affected.
It makes me wonder whether PL is really going to go bust, or is being used as another way to perhaps manipulate the tax system, or screw even more customers.
Once liquidators have been appointed, PL as an asset will be sold, broken up if necessary, in order to raise the most money possible for creditors. Whoever buys it will have a player database, and a chance to win those players back by doing what PL should have done and restore their balances as part of the deal. By hanging on, Media Corp are also hanging on to the player database, keeping it out of the hands of a potential competitor. They may also have a tax write-off to use at the end of the tax year. They could even reflate it with just enough capital to avoid liquidation, and then do a similar sell and buy back.
If they delay, it is also possible for creditors to get a winding up order, which means liquidators will be appointed by the court, rather than by the board of Media Corp.
If PL hang on and eventually restore the player balances, it will still mean players will have lost the use of their money, as well as any interest. Although Media Corp doesn't have the money, they have saved themselves money by using these player funds, rather than their own, in shoring up PL for as long as they did before giving up the struggle.
I agree.
There appears to be a lot of sleight of hand going on with capital restructuring and the almost 30 percent ownership of shares achieved by Chris O'Neill and his Jellatech company - bought from Justin Drummond.
There is still no information on Purple Lounge liquidators, and that makes this corporate manouevreing decidely smelly imo.
There appears to be a lot of sleight of hand going on with capital restructuring and the almost 30 percent ownership of shares achieved by Chris O'Neill and his Jellatech company - bought from Justin Drummond.
There is still no information on Purple Lounge liquidators, and that makes this corporate manouevreing decidely smelly imo.
GrandMaster
Dormant account
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- Jan 21, 2004
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- UK
If someone is owed at least £750, he could request that PL is wound up. Any player owed money could threaten to report PL for suspected trading while insolvent, which would make the directors personally liable for the debts of company.
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It does look as though they were, because they were using player funds for their operational expenses in direct violation of their license. If this sticks, it provides another way for players to get their money, because I am sure these former directors made sure they were well provided for.
£750 is very little compared to what poker players generally hold in their accounts. It just needs a volunteer prepared to make the first move. Maybe some of the "no win, no fee" firms will take this on, even though it is outside their usual field (suing for even the most trivial accident).
whatever
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Could this be reported as fraud? I am not from the UK and I don't know how the system works.
The amounts involved would definitely make the claim worthwhile for a law firm even though the legal grounds appear to be thin. I see players are pretty much resigned with the situation despite the fact that the FAQ on the Purple Lounge website gives them no guarantees of reimbursement.
On the other hand, investors who attended the General Meeting on July 5th said the new board is mainly focused on launching Intabet.
Is seems everybody quietly expects this to get buried together with players' money. I sent 4 e-mails to the LGA in the last 5 weeks asking for a reply, whatever it may be. Got nothing back.
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whatever
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Sorry for the late reply!
Even though PL wasn't publicly kicked out of MG Poker network, they were forced to leave because of "repeated violations of the network’s rakeback policies". Their player base was full of grinders.
5050Poker found themselves in a similar situation only a couple of months later. They must have understood that migrating to another poker network with those players is nothing short of suicidal, so they decided to liquidate to company directly. Indeed it seems player's money was not used to cover operational costs, so the funds are there for the LGA to step in and save the day.
- Joined
- Mar 7, 2008
- Location
- UK
Purple Lounge is two companies, PL UK and PL Malta.
It's all quite complex. I have no idea how long they are allowed to take to appoint a liquidator. Seems like they don't really intend to at all.
It's all quite complex. I have no idea how long they are allowed to take to appoint a liquidator. Seems like they don't really intend to at all.
- Joined
- Oct 14, 2004
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- United Kingdom
I suspected they did not make this "suicidal" decision to leave MGS poker on their own, however, they did NOT liquidate straight away. They must have known that leaving the network would cause a sudden surge of withdrawals, but since player funds are supposed to be ring fenced anyway, this should not have caused them problems in paying those players that wanted to leave.
It seems PL were ALREADY using player funds at that point, but had believed they could keep this hidden because they knew their poker players would not jump ship overnight. When their hand was forced by MGS, they probably didn't have enough funds to pay all the players, yet they continued to trade for some months. This would be grounds for claiming "trading whilst insolvent". They must have hoped they could ride out the storm, and cover departing players' payments from new players' deposits. This didn't work out, and by March their problems became public, with players reporting severe delays in payments. This would have been "game over" for PL, as players would leave even faster, yet new deposits would be harder to come by as players who had read about the problems steered clear.
I recall seeing an upsurge in PL casino offers to my email early this year, and this must have been part of the effort to increase the level of deposits. I resisted long enough to steer clear of the eventual meltdown, and this was helped by the sudden negative changes and removal from accredited that ocurred when Media Corp initially bought PL and installed their own managers.
Ideally, a UK based player, or at least an EU based one, owed more than £750, would be best placed to pursue action.
Given their latest odd dealings, along with a reluctance to "get on with it" and appoint a liquidator, it may be that they are deliberately stalling for some reason. It could be worth a try calling their bluff.
A player owed more than £750 could contact PL, and copy to Media Corp head office, their intention to petition for a winding up order. If for any reason they are deliberately stalling, it might produce an offer of settlement from Media Corp to kill off the threat of such a petition succeeding. If they take this approach, it could set a precedent for ALL players owed by PL to make a claim against Media Corp.
Media Corp must surely realise that a launch of Intabet is risky given the anger of PL players who didn't get their money even though it was supposedly ring fenced, a claim that no doubt Intabet will be making about the security of player funds.
I think any attempt to launch Intabet by this new management should be opposed until the Purple Lounge players have been properly treated.
I'm sure that there are plenty of disgruntled Media Corp-Purple Lounge investors and players who will publicise the disgraceful back-story of this company and its relationbship with Intabet if any launch attempt is made, and they could hardly be blamed for doing so.
I agree with previous posters here who have noted that the new management appear little better than the old when it comes to transparency, communication and action regarding the promised appointment of liquidators.
Unfortunately, the owed players appear to lack cohesion - a concerted and organised move along the lines suggested above would certainly get these guys' attention and speed up their rather languid approach to this awful scandal.
I'm sure that there are plenty of disgruntled Media Corp-Purple Lounge investors and players who will publicise the disgraceful back-story of this company and its relationbship with Intabet if any launch attempt is made, and they could hardly be blamed for doing so.
I agree with previous posters here who have noted that the new management appear little better than the old when it comes to transparency, communication and action regarding the promised appointment of liquidators.
Unfortunately, the owed players appear to lack cohesion - a concerted and organised move along the lines suggested above would certainly get these guys' attention and speed up their rather languid approach to this awful scandal.
Interesting - the following notification went into the London Gazette Friday July 6 - not exactly the best way to inform owed players (a general press release would have been nice) but useful information nevertheless.
Note the liquidators are Baker Tilly UK.
Time to get those claims in Purple Lounge players!
Date:6 July 2012 Issue Number:60201 Page number:13044
Publication Date: Friday, 6 July 2012
Notice Code: 2442
Meetings of Creditors
PURPLE LOUNGE LTD
(Company Number 05132341)
No 1 Poultry, London EC2R 8JR
Principal Trading Address: No 1 Poultry, London EC2R 8JR
Notice is hereby given, pursuant to Section 98 of the Insolvency Act 1986 (as amended), that a meeting of the creditors of the above named company will be held at The Clock House, 140 London Road, Guildford, Surrey GU1 1UW on 23 July 2012 at 10.30 am for the purposes of dealing with Section 99 to 101 of the Insolvency Act 1986 (as amended).
A shareholders’ meeting has been convened for 23 July 2012 to pass a resolution for the winding up of the company.
Secured creditors (unless they surrender their security) must give particulars of their security and its value if they wish to vote at the meeting.
The resolutions to be taken at the meeting may include a resolution specifying the terms on which the Joint Partners are to be remunerated including the basis on which disbursements are to be recovered from the company’s assets and the meeting may receive information about, and be called upon to approve, the costs of preparing the statement of affairs and convening the meeting.
A full list of the names and addresses of the company’s creditors may be examined free of charge at the offices of Baker Tilly Restructuring and Recovery LLP, The Clock House, 140 London Road, Guildford, Surrey GU1 1UW between 10.00 am and 4.00 pm on the two business days prior to the day of the meeting.
Further details are available from Victoria Smith, telephone number 01483 307 035.
N Jagat Director (Media Corporation Plc)
Link Removed (invalid URL)
Note the liquidators are Baker Tilly UK.
Time to get those claims in Purple Lounge players!
Date:6 July 2012 Issue Number:60201 Page number:13044
Publication Date: Friday, 6 July 2012
Notice Code: 2442
Meetings of Creditors
PURPLE LOUNGE LTD
(Company Number 05132341)
No 1 Poultry, London EC2R 8JR
Principal Trading Address: No 1 Poultry, London EC2R 8JR
Notice is hereby given, pursuant to Section 98 of the Insolvency Act 1986 (as amended), that a meeting of the creditors of the above named company will be held at The Clock House, 140 London Road, Guildford, Surrey GU1 1UW on 23 July 2012 at 10.30 am for the purposes of dealing with Section 99 to 101 of the Insolvency Act 1986 (as amended).
A shareholders’ meeting has been convened for 23 July 2012 to pass a resolution for the winding up of the company.
Secured creditors (unless they surrender their security) must give particulars of their security and its value if they wish to vote at the meeting.
The resolutions to be taken at the meeting may include a resolution specifying the terms on which the Joint Partners are to be remunerated including the basis on which disbursements are to be recovered from the company’s assets and the meeting may receive information about, and be called upon to approve, the costs of preparing the statement of affairs and convening the meeting.
A full list of the names and addresses of the company’s creditors may be examined free of charge at the offices of Baker Tilly Restructuring and Recovery LLP, The Clock House, 140 London Road, Guildford, Surrey GU1 1UW between 10.00 am and 4.00 pm on the two business days prior to the day of the meeting.
Further details are available from Victoria Smith, telephone number 01483 307 035.
N Jagat Director (Media Corporation Plc)
Link Removed (invalid URL)
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- Oct 14, 2004
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They have only JUST done it on Friday, but using only the minimum required notice by law. If all owed players turn up, they may not all fit in, and this could be highly embarrassing as it would expose the fact that players are also creditors. Such an event WILL attract media coverage, even if only the financial press. However, a story about so many PLAYERS remaining unpaid, yet at the same time player funds are supposedly secured in an account separate to that of the company, will stand a good chance of making the main stream press, and maybe even the radio and TV news.
All owed players who can should go to this meeting, and pack the venue in the hope that there will be problems fitting them all in. I believe there is a legal requirement to allow all creditors to attend, so they would be forced to adjourn the meeting and find a bigger venue.
Perhaps Media Corp were hoping most players don't read the London Gazette, which is a publication that only lawyers tend to read on a regular basis, and so only those players who have taken legal advice on their claim will have been told the London Gazette is the place to look for a notice of liquidation.
It may also be worth getting hold of this list of known creditors, and I suspect there is a need to lodge a claim before the meeting, which is something ALL players should do, whether or not they plan to attend the meeting.
By hiding the notice away from general view, they may hope most players will not see it until the deed is done, and thus too late to lodge their claims.
As an experiment, players could ask Media Corp again whether liquidators have been appointed, to see if they volunteer the truth, or use stalling tactics and tell players to "ask later".
That notice says nothing about the need, nor procedure, for players to lodge a claim, so some may think they don't have to take action. PL will have to provide their own list of known creditors, but can we trust it will be accurate?
All owed players who can should go to this meeting, and pack the venue in the hope that there will be problems fitting them all in. I believe there is a legal requirement to allow all creditors to attend, so they would be forced to adjourn the meeting and find a bigger venue.
Perhaps Media Corp were hoping most players don't read the London Gazette, which is a publication that only lawyers tend to read on a regular basis, and so only those players who have taken legal advice on their claim will have been told the London Gazette is the place to look for a notice of liquidation.
It may also be worth getting hold of this list of known creditors, and I suspect there is a need to lodge a claim before the meeting, which is something ALL players should do, whether or not they plan to attend the meeting.
By hiding the notice away from general view, they may hope most players will not see it until the deed is done, and thus too late to lodge their claims.
As an experiment, players could ask Media Corp again whether liquidators have been appointed, to see if they volunteer the truth, or use stalling tactics and tell players to "ask later".
That notice says nothing about the need, nor procedure, for players to lodge a claim, so some may think they don't have to take action. PL will have to provide their own list of known creditors, but can we trust it will be accurate?
whatever
Dormant account
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ok, so I called Ms. Victoria Smith from Baker Tilly.
She confirmed that they are expecting to be properly appointed as liquidators of Purple Lounge LTD at the meeting on July 23rd. However, she said that Media Corp has NOT provided them with a list of players as creditors. She promised to ask Media Corp's management for clarification on this matter, but for now, players are NOT on the creditors' list.
I then called Media Corp, asked to be passed to someone who is familiar with the situation. The person I've spoken to confirmed that a liquidator has been appointed, but was not aware of the notification in the London Gazette (or any other notification for that matter). He couldn't tell if players are on the creditor list and again, took my details and promised to come back with details from the management.
Can someone please call again and confirm this because I honestly can't believe what's happening!!
She confirmed that they are expecting to be properly appointed as liquidators of Purple Lounge LTD at the meeting on July 23rd. However, she said that Media Corp has NOT provided them with a list of players as creditors. She promised to ask Media Corp's management for clarification on this matter, but for now, players are NOT on the creditors' list.
I then called Media Corp, asked to be passed to someone who is familiar with the situation. The person I've spoken to confirmed that a liquidator has been appointed, but was not aware of the notification in the London Gazette (or any other notification for that matter). He couldn't tell if players are on the creditor list and again, took my details and promised to come back with details from the management.
Can someone please call again and confirm this because I honestly can't believe what's happening!!
This is the sort of behaviour that makes everyone suspicious - please update us if you have not had an answer to your enquiry by Thursday so we can all keep tabs on what these businessmen are doing on the PL matter.
In the meantime spread the word about the liquidators and Media Corp not including players as creditors.
I've also submitted questions to Media Corp on several issues arising in this thread, and I will keep interested readers updated on any answers I receive.
If Media Corp have an explanation on their treatment of players, I'm sure we're all interested in hearing it.
In the meantime spread the word about the liquidators and Media Corp not including players as creditors.
I've also submitted questions to Media Corp on several issues arising in this thread, and I will keep interested readers updated on any answers I receive.
If Media Corp have an explanation on their treatment of players, I'm sure we're all interested in hearing it.
- Joined
- Oct 14, 2004
- Location
- United Kingdom
Cue buck passing exercise
I expect they will claim another party is responsible for player funds under this ringfencing regulation, so do not have to list them as creditors.
This could seriously backfire, but it would need both players and the media to put pressure on the liquidators to INSIST that a list of player balances that remained unpaid be provided, as legally they are unsecured creditors.
It seems odd that this meeting will only appoint the liquidators on the day, so it would be worth checking whether players could, or even need to, turn up on the day and make a claim.
It is starting to look like PL are trying to perpetuate the lie they told the LGA about all players having been paid their balances prior to the decision to permanently close the operation. They have not merely kept players out of the loop, but have withheld information from the prospective liquidators.
They have more or less been appointed, what happens at a creditors meeting is a vote among creditors on whether to accept this appointment or demand an alternative liquidator to be found. It is secured creditors that fare better, as they can simply seize their security. Unsecured creditors then have a share of what's left. Shareholders are only supposed to get something if all creditors can be paid in full.
GrandMaster
Dormant account
- Joined
- Jan 21, 2004
- Location
- UK
My guess is that the casino was operated by Purple Lounge Malta, so the players are not creditors of Purple Lounge UK.
Very good point; perhaps players can query this.
It is not unknown for businessmen in trouble to create elaborate strategies to duck their obligations, and there certainly seems to be a significant amount of obfuscation going on here.
I have added the ommission of player lists from the liquidation document to the list of questions for Media Corp submitted yesterday - hopefully a timeous answer to that and the other questions will clear this element up.
- Joined
- Mar 7, 2008
- Location
- UK
No, it is the law that these announcements be placed in this journal.
- Joined
- Mar 7, 2008
- Location
- UK
Indeed. The company being liquidated is the UK company, which effectively marketed the Malta casino, which they claim owes the balances. This is why players are not listed as creditors.
HOWEVER, deposits were taken and received by the UK company which is being liquidated. If you deposited by card you can see this, as the company name taking the money was PL Ltd or often "Ashton Contracts Ltd" - an old name for Purple Lounge Limited. So the UK company took the money, it is the UK company which surely owes the balances, and players should be on the list.
GrandMaster
Dormant account
- Joined
- Jan 21, 2004
- Location
- UK
In all likelihood, Purple Lounge UK only acted as an agent for Purple Lounge Malta in processing the payments.
whatever
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- Feb 13, 2010
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- always at work
I received confirmation that "player creditors are creditors of Purple Lounge (Malta) Limited, a Malta registered company" and "Baker Tilly Restructuring and Recovery LLP, is not instructed in respect of any other company in the group".
Can you confirm the source of that information please?
Did you ask what recourse players are being offered in respect of Purple Lounge Malta, which is presumably still a subsidiary of Media Corp?
whatever
Dormant account
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This is the confirmation I received today from Ms. Smith, who promised 2 days ago to get back after seeking clarification from the MDC board regarding the company responsible for players' funds.
- Joined
- Mar 7, 2008
- Location
- UK
Since they claim the Maltese division owes the players, and this still seems to be trading officially, if you are owed less than 2000 euros and live in the EU it is quite simple and cheap to sue PL Malta and have the case heard in your own country.
The address is Purple Lounge (Malta) Ltd, Villa Seminia, 8, Sir Temi Zammit Avenue, Ta’ Xbiex XBX1011, Malta and you can get all the details here:
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Log in or register now.
Good information.
After three days with no real answers I am beginning to think that Media Corp and its PR people are stonewalling on the questions put to them regarding these important player issues.
I have to wonder whether the Malta company can still be regarded as functional however - remember that Media Corp's previous management asked for the LGA licence to be cancelled.
In any case I suspect it is merely a paper company operating from a lawyer's office.
I remain absolutely appalled at the prospect that these people may get away with shorting the players who supported their enterprise, and at the lack of respect they have shown those players so far.
After three days with no real answers I am beginning to think that Media Corp and its PR people are stonewalling on the questions put to them regarding these important player issues.
I have to wonder whether the Malta company can still be regarded as functional however - remember that Media Corp's previous management asked for the LGA licence to be cancelled.
In any case I suspect it is merely a paper company operating from a lawyer's office.
I remain absolutely appalled at the prospect that these people may get away with shorting the players who supported their enterprise, and at the lack of respect they have shown those players so far.
- Joined
- Mar 7, 2008
- Location
- UK
It is a paper company indeed, with no physical assets as far as I can tell.
Sadly, players are not going to be paid anything, and MediaCorp are going to continue and get away with what they have done.
whatever
Dormant account
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- Feb 13, 2010
- Location
- always at work
Link Removed ( Old/Invalid)
I didn't see this until now. Unfortunately it turns out this is exactly the same scenario, catching the LGA pants-down again!
I wonder, how many other "time bombs" are there?
At the very least, I hope that players, affiliates and webmasters alike will all remember this incident, because these guys are clearly going to try their luck at other internet gambling ventures.
I still think that players should act in concert and obtain professional legal advice on what they can do about this attempt to just walk away from the Purple Lounge obligations to players.
- Joined
- Mar 7, 2008
- Location
- UK
I'm not sure I can link to another forum, but on 2+2 they are getting together to take action, so check there and join in.
PLAYER QUESTIONS CONTINUE ON PURPLE LOUNGE LIQUIDATION (Update)
Players are apparently not covered in liquidation of Purple Lounge UK
In the absence of clarifying communications from the new management of Purple Lounge parent Media Corp plc, players were left speculating on their fate this week after being told by liquidators that they were not regarded as creditors in the disposal of Purple Lounge UK.
Readers will recall that Purple Lounge players were subjected to questionable excuses for slow pay practices earlier this year, which escalated into serious payment problems after Media Corp management Justin Drummond and Sara Vincent switched poker networks to Entraction.
The online casino and poker site subsequently 'suspended' operations, after which it was learned that Media Corp management had requested the Malta regulator LGA to cancel the Purple Lounge licence.
As bewildered players tried to find out what was happening - and were ignored - the Drummond-Vincent management team at Media Corp resigned and a new management took control, subsequently announcing that Purple Lounge was to be liquidated.
It emerged that player funds had not been segregated as required by the regulator, and the indications were that player deposits had been used to meet operational expenses under Vincent's Purple Lounge stewardship.
There were unconfirmed rumours of a forensic audit being conducted by the new management, which had also inherited a breach of contract claim by CD Casinos.com Limited in respect of Media Corp's former asset Gambling.com.
Last Friday, Media Corp used the London Gazette to announce that the respected London firm Baker Tilly had been appointed as liquidators of Purple Lounge UK.
However, when players called the liquidator to lodge claims they were informed that players were not on the creditor list supplied by Media Corp.
In a typical experience, one player related that he was told by Baker Tilly that "player creditors are creditors of Purple Lounge (Malta) Limited, a Malta registered company" and "Baker Tilly Restructuring and Recovery LLP, is not instructed in respect of any other company in the group".
Media Corp management has yet to clarify how its Purple Lounge Malta players are to be recompensed, but their silence is ominous, triggering adverse speculation about their intentions.
Players are currently considering legal avenues that may be open to them in order to claim the monies owed to them through either Purple Lounge Malta or Media Corp.
One theory is that players who are owed less than Euro 2000 and live in the EU could cheaply lodge a legal claim in Malta, but have the case heard in their country of residence.
But whether Purple Lounge Malta has the wherewithal to meet such demands is doubtful.
Meanwhile, the reputational damage is growing, with media reports noting that neither the Malta regulator nor Media Corp, despite its status as a listed company, protected its players...or is treating them with the respect they are entitled to as customers.
That could bode ill for any other online gambling enterprises or products that Media Corp may decide to launch in the future...trust is a major and invaluable commodity in this industry.
Players are apparently not covered in liquidation of Purple Lounge UK
In the absence of clarifying communications from the new management of Purple Lounge parent Media Corp plc, players were left speculating on their fate this week after being told by liquidators that they were not regarded as creditors in the disposal of Purple Lounge UK.
Readers will recall that Purple Lounge players were subjected to questionable excuses for slow pay practices earlier this year, which escalated into serious payment problems after Media Corp management Justin Drummond and Sara Vincent switched poker networks to Entraction.
The online casino and poker site subsequently 'suspended' operations, after which it was learned that Media Corp management had requested the Malta regulator LGA to cancel the Purple Lounge licence.
As bewildered players tried to find out what was happening - and were ignored - the Drummond-Vincent management team at Media Corp resigned and a new management took control, subsequently announcing that Purple Lounge was to be liquidated.
It emerged that player funds had not been segregated as required by the regulator, and the indications were that player deposits had been used to meet operational expenses under Vincent's Purple Lounge stewardship.
There were unconfirmed rumours of a forensic audit being conducted by the new management, which had also inherited a breach of contract claim by CD Casinos.com Limited in respect of Media Corp's former asset Gambling.com.
Last Friday, Media Corp used the London Gazette to announce that the respected London firm Baker Tilly had been appointed as liquidators of Purple Lounge UK.
However, when players called the liquidator to lodge claims they were informed that players were not on the creditor list supplied by Media Corp.
In a typical experience, one player related that he was told by Baker Tilly that "player creditors are creditors of Purple Lounge (Malta) Limited, a Malta registered company" and "Baker Tilly Restructuring and Recovery LLP, is not instructed in respect of any other company in the group".
Media Corp management has yet to clarify how its Purple Lounge Malta players are to be recompensed, but their silence is ominous, triggering adverse speculation about their intentions.
Players are currently considering legal avenues that may be open to them in order to claim the monies owed to them through either Purple Lounge Malta or Media Corp.
One theory is that players who are owed less than Euro 2000 and live in the EU could cheaply lodge a legal claim in Malta, but have the case heard in their country of residence.
But whether Purple Lounge Malta has the wherewithal to meet such demands is doubtful.
Meanwhile, the reputational damage is growing, with media reports noting that neither the Malta regulator nor Media Corp, despite its status as a listed company, protected its players...or is treating them with the respect they are entitled to as customers.
That could bode ill for any other online gambling enterprises or products that Media Corp may decide to launch in the future...trust is a major and invaluable commodity in this industry.
- Joined
- Oct 14, 2004
- Location
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It seems Purple Lounge (Malta) is bust, yet not being liquidated. Could players force a winding up order under Maltese law as they could under UK law.
It all shows how convoluted the structures really are in this industry, and the effect is that the effective owners can walk away with full pockets, yet their customers don't even have the basic legal protection they had been lead to believe existed.
It seems 5050 has a similar structure, which has also allowed it to walk away paying only 15% of player balances.
This structuring is not just about being tax efficient as we all thought, it is also about driving the proverbial coach and horses through the regulations designed to protect the player if things go wrong.
It looks like almost EVERY casino and poker operator based in Malta, but run from elsewhere through "holding companies", could go the same way if anything goes wrong. In these 2 cases, it didn't take more than an internal dispute with the network to derail the whole enterprise. Both failures seem to have been driven by a "run" on the poker side, which had the effect of bringing down the casino side too.
There is clearly something "iffy" going on in the poker industry as a whole in regard to these "rakeback disputes" and this "balancing" done by the networks that can place sudden demands on individual skins to lodge large sums in a "clearing account".
If the issue is down to the concept of "rakeback", why is it not policed better so that it does not slip by unnoticed till the potential damage caused by a "correction" causes the skin to shut down altogether.
MGS are not blameless either, as they decided to do nothing, and then react with a sudden and very harsh sanction, which naturally caused a "run on the bank" situation.
Had MGS been on the ball, they could have made gradual changes to correct such imbalances, and although some players would decide to leave, it would not be to the extent of a "run" that could shock the operator into collapse.
No doubt Media Corp will use the same structure when launching their new Intabet venture, and if this also fails, players may find the Maltese company owing the money, but the money itself not actually being there, having moved to the UK controlling company.
What I don't understand is that deposits were being charged by the UK company, with the Malta company apparently not being in possession of this money, yet the UK company also claims it is not responsible.
Perhaps players should see whether they can make a legal challenge to prevent the liquidation of Purple Lounge UK proceeding till a proper account has been given of the flows of money relating to players deposits. If there is any risk that the UK company could be held liable, then any liquidation that does not include players could be invalid. Maybe it would scare the liquidators into halting proceedings, as they could potentially be liable if they distributed the assets without taking account of all creditors.
The sheer complexity of this means that players need access to some pretty clever lawyers, else they could miss their chance. Getting together as seems to be happening at 2+2 is a good idea.
It all shows how convoluted the structures really are in this industry, and the effect is that the effective owners can walk away with full pockets, yet their customers don't even have the basic legal protection they had been lead to believe existed.
It seems 5050 has a similar structure, which has also allowed it to walk away paying only 15% of player balances.
This structuring is not just about being tax efficient as we all thought, it is also about driving the proverbial coach and horses through the regulations designed to protect the player if things go wrong.
It looks like almost EVERY casino and poker operator based in Malta, but run from elsewhere through "holding companies", could go the same way if anything goes wrong. In these 2 cases, it didn't take more than an internal dispute with the network to derail the whole enterprise. Both failures seem to have been driven by a "run" on the poker side, which had the effect of bringing down the casino side too.
There is clearly something "iffy" going on in the poker industry as a whole in regard to these "rakeback disputes" and this "balancing" done by the networks that can place sudden demands on individual skins to lodge large sums in a "clearing account".
If the issue is down to the concept of "rakeback", why is it not policed better so that it does not slip by unnoticed till the potential damage caused by a "correction" causes the skin to shut down altogether.
MGS are not blameless either, as they decided to do nothing, and then react with a sudden and very harsh sanction, which naturally caused a "run on the bank" situation.
Had MGS been on the ball, they could have made gradual changes to correct such imbalances, and although some players would decide to leave, it would not be to the extent of a "run" that could shock the operator into collapse.
No doubt Media Corp will use the same structure when launching their new Intabet venture, and if this also fails, players may find the Maltese company owing the money, but the money itself not actually being there, having moved to the UK controlling company.
What I don't understand is that deposits were being charged by the UK company, with the Malta company apparently not being in possession of this money, yet the UK company also claims it is not responsible.
Perhaps players should see whether they can make a legal challenge to prevent the liquidation of Purple Lounge UK proceeding till a proper account has been given of the flows of money relating to players deposits. If there is any risk that the UK company could be held liable, then any liquidation that does not include players could be invalid. Maybe it would scare the liquidators into halting proceedings, as they could potentially be liable if they distributed the assets without taking account of all creditors.
The sheer complexity of this means that players need access to some pretty clever lawyers, else they could miss their chance. Getting together as seems to be happening at 2+2 is a good idea.
- Joined
- Mar 7, 2008
- Location
- UK
Not only were deposits taken by the UK Company PL Ltd / AC Ltd, withdrawals made by bank transfer or card were sent from the UK Company too. The Maltese company did not take payments or, pertinently, pay withdrawals. Therefore, I cannot see how it cannot be the UK Company that owes the players.
I shall call Ms Smith on Monday and put this to her.
- Joined
- Oct 14, 2004
- Location
- United Kingdom
I take it you have statements providing evidence.
If Ms Smith just rejects your claim again, you may have to see if you have grounds to take some kind of legal action, such as an injunction preventing the liquidation going any further till this matter has been cleared up.
If the Maltese PL hasn't gone bust, it might be worth contacting them too, and see if they try passing the buck back to the UK company (preferrably in writing). If this happens, you will have a "catch 22" mutual contradiction, and this may be enough to stall the liquidation.
IMO if the liquidators are worth their salt (and they have a decent reputation from what I have been able to ascertain), they will be asking Media Corp questions about Purple Lounge Malta's situation before proceeding further, so focusing the attention of Ms Smith and her seniors may be a good tactic to get some justice here.
I don't think we can rely on the Media Corp management to do much more than duck and dive to avoid what I see as the company's obligation to the players at its subsidiary.
Not sure about making progress through the Malta company - if I recall correctly the man in charge (who was probably just a lawyer in a local paper company designed to hold the licence anyway), resigned as a director about three weeks before Media Corp asked for the licence to be cancelled (I'm sure I read that in a post from Alfonso earlier in this thread). So there's probably not a lot left of Purple Lounge Malta with which to engage. And we all know how useless the Malta regulator appears to be in this matter.
Nevertheless, imo the fact that the UK Purple Lounge was the clearing house for player transactions implies some responsibiulity for this questionable and I suspect deliberate corporate confusion over who should be looking after the players.
BTW, this thread has had tens of thousands of views, a cautionary tale for any prospective player at any Media Corp venture in the future imo.
I don't think we can rely on the Media Corp management to do much more than duck and dive to avoid what I see as the company's obligation to the players at its subsidiary.
Not sure about making progress through the Malta company - if I recall correctly the man in charge (who was probably just a lawyer in a local paper company designed to hold the licence anyway), resigned as a director about three weeks before Media Corp asked for the licence to be cancelled (I'm sure I read that in a post from Alfonso earlier in this thread). So there's probably not a lot left of Purple Lounge Malta with which to engage. And we all know how useless the Malta regulator appears to be in this matter.
Nevertheless, imo the fact that the UK Purple Lounge was the clearing house for player transactions implies some responsibiulity for this questionable and I suspect deliberate corporate confusion over who should be looking after the players.
BTW, this thread has had tens of thousands of views, a cautionary tale for any prospective player at any Media Corp venture in the future imo.
- Joined
- Oct 14, 2004
- Location
- United Kingdom
Well, a bit of forensic accounting should reveal who was actually handling the money. I can't believe a mere paper company headed by a lawyer had the wherewithall to handle the financial transactions, so maybe the money never left Purple Lounge UK, it got used up BY Purple Lounge UK in the run up to this fiasco.
If there was deliberate intent to deceive throughout any of this, criminal charges could follow.
It seems Media Corp want this over with ASAP, even if it means cutting corners and screwing over the players. Maybe keeping player debts out of the picture is intended to allow the chance that Media Corp will manage to recover something from Purple Lounge UK at the end of this process.
Maybe UK players affected by this should pressure their local MP to have this whole affair looked into. Mainstream financial press also needs to be encouraged to start an investigation. It still seems that outside of the online gambling community, this is pretty low key. If a retailer did the same kind of thing (Farepak for example) it would be all over the front pages and in the TV news.
Farepak had some similarities. Members paid in to the scheme which offered them shopping vouchers or hampers at Christmas paid for by the regular weekly savings they paid into the scheme. This money was supposedly kept separate, but when Farepak went under, it was all gone, used up in trying to keep the company afloat. This scandal DID eventually cause debate in parliament, along with a tightening of regulations.
- Joined
- Apr 27, 2012
- Location
- southern italy
the fact that a UK entity (in this case UK PL) was conducting the back office procedures obo of a Malta licensed operation is not new and IMO should not be considered as illegal. most of times these structures are set-up in this fashion to reduce costs and push the load onto the areas where the resources are located. For instance there are a number of licensed operators having call and payment processing centers in the Baltic countries. it seems evident that the Malta PL did not have any resources on the island other than the statutory resident director to satisfy the licensing conditions. (this in itself does not prejudice such structures - there seems to be a good variety of structures on the island and not all have gone bust or made a runner).
the reality is that there are two separate legal structures in two separate jurisdictions - the mother company UK PL and the trading company Malta PL (which also held the license/s). The contractual obligation with the players does not stand with the UK PL but the Malta PL. the T&Cs should have indicated that clearly. the onus to maintain these contractual obligations stays/ed with the Malta PL and its management under its license conditions.
surely the liquidators appointed to liquidate the UK PL should ask pertinent questions as to how the same entity ended up meddling with funds pertaining to the Malta PL, as surely this would have gone over and above any standard contract for the provision of back-office functions. my logic tells me that the Malta PL should take legal action against the UK PL for unlawful conduct in the handling of funds pertaining to the Malta PL's operations. this is the same mess happening with the banks whereby the customers trust their monies with the banks and the same banks mismanage them to the detriment of the customers.
- Joined
- Oct 14, 2004
- Location
- United Kingdom
Well, something odd, if not illegal, has been happening. If PL (Malta) is just a maildrop in a lawyers office, how could it have been dealing with player funds? It rather looks like the handling of everything was done by PL (UK), so they took player deposits on behalf of PL (Malta), and ran all the back office and player management on behalf of PL (Malta). Since there was a legal requirement under Maltese regulations to segregate player funds, PL (UK) should have had no legal means to do anything other than keep them safe on behalf of PL (Malta) and the players. Since they have clearly been spent by PL (UK) on other things, this could be illegal.
If anything, surely PL (Malta) is a creditor of PL (UK) with respect to player funds. Players have their contract with PL (Malta), and Media Corp says this is where they should go to look for their money. Since PL (Malta) had PL (UK) hold the funds on their behalf, this amount would be owed to PL (Malta), and therefore PL (Malta) should be listed as a creditor of PL (UK). It should be known what the exact value of player funds are, and together with the lawyers fees for acting as director, this would be what PL (UK) owes PL (Malta).
The problem, and the skullduggery, is that PL (Malta) is Media Corp's puppet, and is not likely to rock the boat of it's own accord in order to lodge a claim against PL (UK). If this is what the liquidator and Media Corp claim is the correct structure, then players need to force a winding up of PL (Malta), which in turn would open it's books up to a liquidator, and show where players' funds were from a different point of view.
It may turn out that the Maltese liquidator will determine that PL (UK) is responsible for players' funds, which will be a spanner in the works for Media Corps strategy of liquidating PL (UK) and launching Intabet.
It is going to take some players getting together and hiring some good lawyers for a "class action".
- Joined
- Mar 7, 2008
- Location
- UK
yes, I spoke to Ms Smith. She is very polite and friendly.
The long and the short of it is that PL say players are owed by malta as we know, and if you have evidence which suggests you are owed by PL UK contrary to what they say, you can still apply to be a creditor, which I have done.
PL Malta is to be wound up in due course. It has no assets other than a letter box though so this is a paper excersise.
It's all very dodgy though isn't it.
The long and the short of it is that PL say players are owed by malta as we know, and if you have evidence which suggests you are owed by PL UK contrary to what they say, you can still apply to be a creditor, which I have done.
PL Malta is to be wound up in due course. It has no assets other than a letter box though so this is a paper excersise.
It's all very dodgy though isn't it.
- Joined
- Oct 14, 2004
- Location
- United Kingdom
So, how can it have managed any money? It seems all the money management, casino/poker operation, etc was done by the UK company, with the Maltese company being nothing more than a letterbox company designed to hold the license. If players money was never sent to the Maltese company, and stayed wholly within the UK company, how can the Maltese company be the debtor to anyone.
It needs a legal challenge to determine who holds responsibilty for debts under these common circumstances, and maybe an injunction to freeze the process of liquidation of PL UK until it is determined who legally owes the money to players.
This same structure must hold for almost all casinos and poker rooms operating out of Malta, so if it is the "letterbox" company who owes the money, but the money is held in, say, the UK company, it means players are NEVER protected, and the arrangement makes it easy to ignore the Maltese requirement to segregate player funds simply by not having the money in Malta to start with.
This kind of corporate trickery is the domain of the determined rogue trader, who sets up such structures purely as a means to make money when things go well, but keep this money safely out of the hands of creditors when things go badly.
Media Corp seem to have plenty of money to buy back two assets they only sold recently, as well as take over Intabet. This money came from the customers of their various companies.
- Joined
- Jun 20, 2001
It really makes one physically ill doesn't it?
I hope that CM keeps track of any and all Media Corp ventures in the future so we can all avoid them.
It's times like these that I feel so lucky that we have an in-house lawyer
I hope that CM keeps track of any and all Media Corp ventures in the future so we can all avoid them.
It's times like these that I feel so lucky that we have an in-house lawyer
- Joined
- Sep 12, 2004
- Location
- Up$hitCreek
It really makes one physically ill doesn't it?
I hope that CM keeps track of any and all Media Corp ventures in the future so we can all avoid them.
It's times like these that I feel so lucky that we have an in-house lawyer
It really does make me want to puke. Nothing makes any sense... How can you have a company that owes players money, but wasn't the company that took their deposits? and in the end, doesn't really exist? Reading thru this stuff is like being caught up in Alice's wonderland...
Twas brillig, and the slithy toves
Did gyre and gimble in the wabe:
All mimsy were the borogoves,
And the mome raths outgrabe.
"Beware the Jabberwock, my son!
The jaws that bite, the claws that catch!
Beware the Jubjub bird, and shun
The frumious Bandersnatch!"
- Joined
- Mar 7, 2008
- Location
- UK
Bear in mind that no one is getting their money whatever happens - the very very best that might happen is you get a small percentage of it.
I'm pursuing it more out of interest really, I am quite surprised that this is able to happen. I might set up a holding company of my own and a doomed subsidiary and pull the same trick, seems like a no-lose bet to me
I'm pursuing it more out of interest really, I am quite surprised that this is able to happen. I might set up a holding company of my own and a doomed subsidiary and pull the same trick, seems like a no-lose bet to me
Thanks for the update questa.
I have to agree with VWM and others here - I feel outraged at this sort of corporate manouevreing to get out of obligations to players - whether it's PL UK or Media Corp itself - the place where all the money ultimately went and where all the management decisions were really made.
I have to wonder whether these new Media Corp guys are not just chancing their arms and could be pulled up short by a serious legal challenge as is being suggested over at twoplustwo - and VMW's injunction idea sounds as if it could help throw a spanner in the Media Corp works as well.
The new management at Media Corp appear to have money to reacquire assets, they also recently reported incoming funds as a result of that transaction, and they boasted about a large bank loan facility as well, which they are presumably holding in reserve to promote Intabet...the decent, honest and fair thing to do would be to first settle Purple Lounge players before plunging back into the industry with Intabet.
I have a feeling that this issue has a way to run yet, and I hope that the owed players prevail, keeping us informed as developments progress.
It would just be so wrong if Media Corp was allowed to get away with this...and as has been said already here it paints a very insecure and unsavoury picture of the industry from a player perspective.
I have to agree with VWM and others here - I feel outraged at this sort of corporate manouevreing to get out of obligations to players - whether it's PL UK or Media Corp itself - the place where all the money ultimately went and where all the management decisions were really made.
I have to wonder whether these new Media Corp guys are not just chancing their arms and could be pulled up short by a serious legal challenge as is being suggested over at twoplustwo - and VMW's injunction idea sounds as if it could help throw a spanner in the Media Corp works as well.
The new management at Media Corp appear to have money to reacquire assets, they also recently reported incoming funds as a result of that transaction, and they boasted about a large bank loan facility as well, which they are presumably holding in reserve to promote Intabet...the decent, honest and fair thing to do would be to first settle Purple Lounge players before plunging back into the industry with Intabet.
I have a feeling that this issue has a way to run yet, and I hope that the owed players prevail, keeping us informed as developments progress.
It would just be so wrong if Media Corp was allowed to get away with this...and as has been said already here it paints a very insecure and unsavoury picture of the industry from a player perspective.
- Joined
- Jun 30, 1998
- Location
- Bierland
This is where my interests lie - keeping my eyes open for any new property of Media corp. And I'm sure there are plenty of folks out there that would assist on a "watch and wait" campaign. These guys always come back in some shape or form. And when they do it's "fast tracked to the rogue section" for all I care.
Like questa mentioned, no one is going to see any money out of this. These guys have set themselves up to protect against a situation like this - owing players their funds.
It's the LGA who should be tarred and feathered. This is negligence in the worst form - they failed to ensure that players' funds would be protected. I thought this is the primary concern of a licensing agency.
- Joined
- Jun 20, 2001
Bear in mind that no one is getting their money whatever happens - the very very best that might happen is you get a small percentage of it.
I'm pursuing it more out of interest really, I am quite surprised that this is able to happen. I might set up a holding company of my own and a doomed subsidiary and pull the same trick, seems like a no-lose bet to me
Judging by your PAB history, are you sure you haven't done that already....??
Just kidding. The opening was there and I took it (a saying I learnt from Seventh77 albeit from a completely different type of thread...)
I doubt whether the LGA could be any more discredited than it is at present following the various failures in which it has been involved as so-called regulator this year alone. It has shown itself to be inept and uncaring from a player perspective imo.
But my interest lies not only in monitoring any future attempts by Media Corp management to exploit players, but in seeing a real test of their strategies through a legal challenge.
Up to now they have called all the shots without considering the welfare of the players, and I would like to see a cogent legal response from the owed players that tests the decisions that have been unilaterally made by Media Corp management past and present in this matter.
But my interest lies not only in monitoring any future attempts by Media Corp management to exploit players, but in seeing a real test of their strategies through a legal challenge.
Up to now they have called all the shots without considering the welfare of the players, and I would like to see a cogent legal response from the owed players that tests the decisions that have been unilaterally made by Media Corp management past and present in this matter.
- Joined
- Jan 20, 2004
- Location
- Pictland
FWIW this is absolutely confirmed from what I see on the PAB side of things: as useless as spare nipples on a breast plate (ASOIAF
).Should add that this "letter box" company business is pretty much standard practice in Cyprus, Malta too it seems. There are lawyers there who walk around with briefcases containing dozens and dozens of casinos "registered locally". One guy said his briefcase contained a billion dollars in paper companies. And the paper in those briefcases is about all the presence those casinos have locally too, aside from their wonderful letterbox. It's a scam and a big fat dodge, like registering oil tankers in Liberia to avoid liability for oil spills, etc. Governments let it happen because it pays so well to do so. A casino license from Cyprus is written on bog roll, Malta is no better.
