CEREUS Network Headed For Bankruptcy Court

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After the debilitating actions of the U. S. Department of Justice from “Black Friday,” it appears that the CEREUS Network, comprised of the sister sites Absolute Poker and UB.com, will be entering bankruptcy court in Norway.

According to reports from MSNBC.com and the online site HoldemPokerChat, shareholders of Madeira Fjord, the Norwegian company responsible for shares in Absolute Poker, received an e-mail that detailed out the plans to enter into bankruptcy. MSNBC reports that the e-mail to shareholders stated that Blanca Gaming “(has) no cash on hand and no prospects for any cash flow for the foreseeable future.”

The Madeira Fjord e-mail continues on to state that Blanca Gaming “has provided notice that it is currently unable to make any payments toward its debt obligations. Additionally, Blanca has further advised that there will be no future payments.”

At HoldemPokerChat, a full version of the e-mail that MSNBC cites has been posted for readers. In that e-mail, there are further details gives as to the actual cash flow problems that Blanca Gaming has been having since the beginning of 2011. “Over the past sixty days, (Blanca Gaming) has accumulated current debts in excess of $250,000 which are increasing at $100,000+ per month. These obligations are primarily legal and professional fees in Norway.”

“With no cash on hand and no prospects for any cash flow for the foreseeable future, the Board of Directors is required by Norwegian law to enter the bankruptcy process,” the Madeira Fjord e-mail continues. “The Oslo court will appoint a Receiver who will review the affairs of the Company including the assets, liabilities, and its recent transactions. After a full assessment, the Receiver will make a determination how to enforce any applicable rights, obligations, and obtain the maximum value for its assets in the best interest of the Company.”

HoldemPokerChat’s leader, “Fonzi,” is quoted in the MSNBC article, offering insight into the cash out operations as of late with the CEREUS Network sites. “The problem is they haven’t paid anyone outside the U.S.,” he said. “You are allowed to request $250 a week – request – but that doesn’t mean you’re going to get it. I already consider my money gone.”

The repercussions of the bankruptcy action are already being felt in Costa Rica, the home of Blanca Gaming and the CEREUS Network sites. MSNBC reports that 300 customer service and marketing personnel have been laid off from the company. That number represents 95% of the staff that the company had for operations of the CEREUS Network sites.

Furthermore, it appears that U. S. government officials are closing in on Scott Tom and Brent Beckley, the two founders and owners of Absolute Poker who were named in the April 15 U. S. Department of Justice indictments. A report from Teletica, an online news site in Costa Rica, states that agents from the Federal Bureau of Investigation are on the ground in the Central American nation, seeking to find Tom and Beckley. The report also touches on the plight of the employees of Blanca Gaming, citing that in addition to losing their jobs, they also would lose potential unemployment payments from the company.

The recent downfall of the CEREUS Network can be seen in its precipitous drop in players since the actions of “Black Friday.” According to PokerScout.com, the CEREUS Network has lost approximately 75% of its cash game traffic since April 15. The resulting loss of players has plunged the network from one of the preeminent players in the online poker industry, firmly entrenched in the Top 10, to an “also ran” that is now mired in 27th place in their rankings.

By EARL BURTON

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Earl Burton is a veteran journalist in the poker industry, having covered the game since 2004. He has played the game much longer, however, starting out playing in family games at a very early age. He has covered tournaments across the United States, including the World Poker Tour, the World Series of Poker and various charitable events. Earl’s background includes writing for some of the top poker news sites in the industry as well as other poker media outlets that include Poker Player Newspaper and Canadian Poker Player Magazine. Earl keeps an unblinking eye on the poker world, offering coverage of news from the industry, tournament action, player interviews, strategy and his opinions on the game. Whenever possible, Earl will also step to the tables to demonstrate that there’s more than just writing talent behind his poker game!

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