After over a year of silence Lederer agreed to an interview to discuss the fall of FTP, the loss of player funds, his role in the organization, the effect of Black Friday, what was going on in the company post BF and so on.
While watching the videos one thing seemed very clear to me, Lederer's influence extended past the voting power of his share of the company. When the other stake holders attempted to vote the existing board members out of power Lederer was able to talk enough of them out of it to stop the effort. In the interview he stated he could have "killed it in 5 minutes". At times even the interviewer, Matthew Parvis, was asking questions in a way that already excused Lederer within the context of the question itself.
It appears that Lederer might be a master manipulator. He came off as having a covert-aggressive personality to me. Let's examine some of the traits and methods of person with a covert-aggressive personality and see how many Lederer used in his interview.
An excerpt from a bestselling book on manipulation, In Sheep's Clothing: Understanding and Dealing with Manipulative People, was posted on the Rick A Ross Institute's website. It lists some of the defensive and offensive tactics used by covert-aggressive personalities to manipulate others. Let's examine if Lederer displayed any in his interview.
This is when the aggressor refuses to admit that they've done something harmful or hurtful when they clearly have. It's a way they lie (to themselves as well as to others) about their aggressive intentions.
This tactic is similar to and sometimes mistaken for denial It's when the aggressor "plays dumb," or acts oblivious. When engaging in this tactic, the aggressor actively ignores the warnings, pleas or wishes of others, and in general, refuses to pay attention to everything and anything that might distract them from pursuing their own agenda. Often, the aggressor knows full well what you want from him when he starts to exhibit this "I don't want to hear it!" behavior. By using this tactic, the aggressor actively resists submitting himself to the tasks of paying attention to or refraining from the behavior you want him to change.Lederer claims that he didn't know a lot of what was going on with the company. His interpretation of his role as a member of the Board of Directors was that he was to serve as an adviser on software and marketing and not to oversee that the company is run in a way that protected shareholders equity and liability which is the general role a Board of Directors plays.
He acts as if he had no power over the managers of the company. He only requested that CEO Ray Bitar not accept a salary post Black Friday as if the Board of Directors didn't have authority over the CEO when he knew full well the type of control that the Board has over the company's executives. He even indicated that Bitar was concerned if someone like John Juanda ever got a seat on the board because he would essentially be Bitar's boss.
It has been reported and also confirmed by Lederer in his interview that there were a number of owners that had concerns about the way the company was run and specifically about the suitability of Bitar as CEO yet he was somehow able to dismiss these concerns.
A rationalization is the excuse an aggressor tries to offer for engaging in an inappropriate or harmful behavior. It can be an effective tactic, especially when the explanation or justification the aggressor offers makes just enough sense that any reasonably conscientious person is likely to fall for it.Lederer has a rationalization for everything and a lot of people seem to have fallen for them. They kept taking ROW deposits because if the company stopped operating there would be no chance of players getting paid back. That sounds logical except putting more people's money at risk for the chance to save other people's money isn't the right (or legal) thing to do.
When asked why the board didn't verify the financial condition of the company he claims that the Operating Agreement for Tiltware did not specifically state that he was required to perform any independent financial audits. He doesn't state if the Operating Agreement states that the Board of Directors is required to approve, authorize or in some other way insure owner distributions but this is a fairly universal duty of any board of directors as is making sure the managers of the company are doing a good job. How can you do any of those if you don't pay close attention to the financials of the company?
He also claims FTP did not act as a Ponzi Scheme as alleged in the DOJ's second ammended complaint because the company was generating revenue. That sounds like it may be right but it's not and a company that does generate revenue and even a profit can turn into a ponzi scheme. Once FTP was reliant on incoming funds from ROW players to continue operations and to process player withdrawals while lacking sufficient funds in the appropriate accounts it had become a ponzi scheme.
When the other owners of the company wanted to remove Bitar from his CEO position post Black Friday Lederer explained that it would be difficult because of how many licenses were in Bitar's name, among other things and that it would be best for the company to focus on what he believed to be more pressing issues. These were not impossible problems to tackle. Bitar thought it would be a bad idea to replace the board and management because if word got out it would devalue the company and could cause a "run on the bank" which the company could not handle. The mess the company was in devalued the company, they just wanted to try and hide that by creating an illusion that it was just business as usual. Replacing the board and management would have at least let others know that there were people within FTP that were interested in making changes to turn the company around.
A moving target is hard to hit. When we try to pin a manipulator down or try to keep a discussion focused on a single issue or behavior we don't like, he's expert at knowing how to change the subject, dodge the issue or in some way throw us a curve. Manipulators use distraction and diversion techniques to keep the focus off their behavior, move us off-track, and keep themselves free to promote their self-serving hidden agendas.The biggest instance of diversion was his constant desire to switch attention from his role and actions prior to Black Friday to his actions trying to save the company post Black Friday. He even explains that this is what he was doing with the other owners of the company. He criticized those owners that wanted to find out what happened and who was responsible and instead wanted everyone to focus their attention on what needed to be done to solve the problem and not point fingers.
This sounds reasonable. If your house was on fire the first thing you'd want to do is try and minimize the danger and damage and try to put out the fire but at some point you'd also want to know why the fire started. Wouldn't you? I would. Lederer doesn't seem to care about that even now that the PokerStars deal bailed out FTP. Forget about how FTP abused player's trust and stole their money, forget about how it's been over a year and players still didn't get their money. Just focus on all the hours and hard work Lederer put in to get you your money back!
When I was young there was a teacher that used to say "he who has no brain, has feet" whenever someone did something stupid. It means if you aren't smart about what you're doing now, you'll have to run around fixing things later. All the hard work Lederer put in could have been prevented if he and the rest of the board of directors put a little more effort in before Black Friday.
It's often hard to tell when a person is lying at the time he's doing it. Fortunately, there are times when the truth will out because circumstances don't bear out somebody's story. But there are also times when you don't know you've been deceived until it's too late. One way to minimize the chances that someone will put one over on you is to remember that because aggressive personalities of all types will generally stop at nothing to get what they want, you can expect them to lie and cheat. Another thing to remember is that manipulators – covert-aggressive personalities that they are – are prone to lie in subtle, covert ways.
I still don't buy it.
For all of the BS Howard spouts about not knowing and not being an accountant, Howard is selling himself far too short. He's very good with numbers. He's the kind of person that in a meeting can recall numbers down to two decimal places.
The reason I don't believe that he didn't know anything was that the numbers had to seem funny to him. There's no way that the DOJ seized $40 or $100 million from the company and it wasn't brought up in a board meeting. There's no way nobody asked where the money went and how that would impact the company and the owner distributions.
I know Howard can grill people. I've been on the other side of a grilling trying to justify a project or explaining a cost/schedule overrun. He's very bright, very intelligent, and very detail oriented. Numbers are not something that just pass right by him.
I can't believe that someone who knows FTP as intimately as he does, knows all of the company KPIs, couldn't look at a balance sheet and KPI report and know that something wasn't adding up.
Aggressors frequently threaten their victims to keep them anxious, apprehensive and in a one-down position. Covert-aggressives intimidate their victims by making veiled (subtle, indirect or implied) threats. Guilt-tripping and shaming are two of the covert-aggressive's favourite weapons. Both are special intimidation tactics.This is something that seemed to happen more between the BOD and other owners. The owners were going to lose their equity and potentially face legal issues, the players were going to lose their money and blame the owners. The owners might potentially face legal issues themselves. These are things I can imagine and infer being told to the owners to keep them in check.
One thing that aggressive personalities know well is that other types of persons have very different consciences than they do. Manipulators are often skilled at using what they know to be the greater conscientiousness of their victims as a means of keeping them in a self-doubting, anxious, and submissive position... All a manipulator has to do is suggest to the conscientious person that they don't care enough, are too selfish, etc., and that person immediately starts to feel bad.
This is the technique of using subtle sarcasm and put-downs as a means of increasing fear and self-doubt in others. Covert-aggressives use this tactic to make others feel inadequate or unworthy, and therefore, defer to them.
Playing the Victim Role
This tactic involves portraying oneself as an innocent victim of circumstances or someone else's behavior in order to gain sympathy, evoke compassion and thereby get something from another. One thing that covert-aggressive personalities count on is the fact that less calloused and less hostile personalities usually can't stand to see anyone suffering. Therefore, the tactic is simple. Convince your victim you're suffering in some way, and they'll try to relieve your distress.After Black Friday Lederer wants to portray himself as someone in a terrible situation that worked long, hard hours for no pay to try and resolve a terrible situation he found himself in. A situation which he accepts little responsibility for.
Vilifying the Victim
This tactic is frequently used in conjunction with the tactic of playing the victim role. The aggressor uses this tactic to make it appear he is only responding (i.e. defending himself against) aggression on the part of the victim. It enables the aggressor to better put the victim on the defensive.It may appear that Lederer didn't vilify the victims since he didn't attack the players in any way, but let's not forget that the players weren't the only victims. The other owners of the company were also victims who lost hundreds of millions in equity (if not more) that they found out almost overnight had been completely lost due to the poor decisions made by those in charge of FTP.
He has no problem attacking these victims. They were uninterested in participating, they tried to get in the way, they didn't want to help solve the problems, they wanted to financially gain from a deal, they wanted a salary to be on the board of directors, they owed the company money, they wouldn't sign a paper that would have been inconsequential according to Lederer, etc. This is what Lederer has to say about them.
Playing the Servant Role
Covert-aggressives use this tactic to cloak their self-serving agendas in the guise of service to a more noble cause. It's a common tactic but difficult to recognize. By pretending to be working hard on someone else's behalf, covert-aggressives conceal their own ambition, desire for power, and quest for a position of dominance over others.Lederer continually reminds us how everything he did after Black Friday had one purpose, to get players repaid. Let's not forget that Lederer was facing civil charges from the DOJ that could potentially turn into criminal charges. If he couldn't get outside investors to take responsibility for getting players repaid there's a strong possibility that he would have to forfeit his own money to aid in player restitution. Are we to believe that this had no bearing on his decisions?
It seems to me that Lederer tried to stay in power post Black Friday because he didn't want to emerge as someone who contributed or at least should have prevented the collapse of FTP and the loss of player funds but instead he wanted his last actions to be those of someone that was instrumental in getting players their money back. Then maybe we might forget the rest.
Covert-aggressive personalities are adept at charming, praising, flattering or overtly supporting others in order to get them to lower their defenses and surrender their trust and loyalty. Covert-aggressives are also particularly aware that people who are to some extent emotionally needy and dependent (and that includes most people who aren't character-disordered) want approval, reassurance, and a sense of being valued and needed more than anything. Appearing to be attentive to these needs can be a manipulator's ticket to incredible power over others.The demise of FTP couldn't have been accomplished with out the involvement of FTP's senior management. The board of directors had a duty to oversee these managers. While Lederer has many negative things to say about other owners of FTP, who were not directly involved with the day-to-day operations, he even blamed some of their actions as hindering efforts to repay players, he took it very easy on senior management and other board members.
How can he not have outrage over the people that cause so much harm? How can he not want to name names? Why wouldn't he want to out them as the people that ultimately caused the loss of player money? He had no problem naming people he thought were creating obstacles to get players repaid.
Why would he not turn on the people that would have direct involvement? Is he afraid they might retaliate in some way?
Projecting the blame (blaming others)
Aggressive personalities are always looking for a way to shift the blame for their aggressive behavior. Covert-aggressives are not only skilled at finding scapegoats, they're expert at doing so in subtle, hard to detect ways.The DOJ, the other owners, I think enough was mentioned previously to cover this one.
This tactic is a unique kind of denial coupled with rationalization. When using this maneuver, the aggressor is attempting to assert that his abusive behavior isn't really as harmful or irresponsible as someone else may be claiming. It's the aggressor's attempt to make a molehill out of a mountain.He starts off the interview "I'd like to point out I am one person in what was a complicated situation" and ends the interview painting himself as just an owner, like all the other owners even though he was on the Board of Directors and at one time President. In contrast, when he's talking about all the things he did to get players repaid he makes it sound like he was the only person doing anything.
When he talks about the phantom deposits where FTP would credit player accounts when they made a deposit in the US via eCheck even though FTP did not have the ability to collect those funds from the players' bank accounts he calls it a "backlog". That backlog was the result of months of giving out money without the means to collect it according to the DOJ which resulted in over $150 million dollar hole in the company's accounts. To put that in perspective, FTP owes players just over $300 million and had paid out over $400 million to shareholders. $150 million is a huge number for a company this size.
He focuses on the point that FTP was not a ponzi scheme, a term most are aware of following the Bernie Madoff incident, and tries to make distinctions because FTP had assets and generated revenue. Even though the company had become dependent on outside investment and player deposits (keep in mind deposits, not revenues generated from rake) to be able to pay it's bills and process player withdrawals.