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Update 7 July 2017

I’m pleased to confirm that yesterday, 6th July, PokerStars entered into an agreement with PKR’s administrator, and former PKR players will be able to access their balances by transferring them to a PokerStars account.

Upon hearing the news, Microgaming reached out to PokerStars and has offered our assistance to make this process as simple and smooth as possible for players. PKR used the Microgaming platform, and PokerStars is a customer with whom we have a strong relationship, having recently taken our casino content live. To the extent legally permissible Microgaming will assist PokerStars with account queries or other issues, as needed.

From a personal perspective, I’m glad to see this process come to a conclusion so positively, and I’d like to thank my old friends at PokerStars for doing the right thing. Although the poker community, and the MPN, has lost a dearly loved brand, in the grand scheme of things this is a great outcome for all involved.

The PKR situation has only highlighted the need for better protection of player funds. PKR followed the rules, but the rules clearly aren’t good enough. There is currently no method by which companies can segregate and protect customer funds which guarantees that players will receive all of their money back in the event of insolvency. Even a trust arrangement, which is the highest level of protection currently available and which is used by some of the world’s most reputable operators, is not 100% foolproof (although in practice, it’s close, and is probably safer than holding your money in a bank). To create a foolproof system requires a change in the legal and regulatory framework, and would affect all types of businesses that hold customer money.

Unless and until something changes, anybody who holds a substantial amount of money with an online business should consider fund protection carefully. Statements on this subject from many MPN poker rooms can be found here.

For more information about how PKR players can access their funds, please visit the PokerStars website.

The original update appears below.

-Alex

I’m very sad to confirm that today, PKR informed Microgaming that it had applied for an administration order.

In this blog post, I’m going to set out to answer some of the questions that I expect players to ask.

What Has Happened?

On the evening of the 3rd May 2017, PKR informed Microgaming that it it was in the process of seeking professional independent advice due to financial difficulties and instructed Microgaming to stop deposits, withdrawals and gameplay for PKR players.

Today, the 5th May 2017, PKR informed Microgaming that it had applied to the court for an administration order. Administration is a procedure which acts as a protection mechanism for insolvent companies, the primary objective being to rescue the company as a going concern. More information can be found in the attached document.

Now that PKR is in administration, the obvious question is – what about player funds?

Player Funds

PKR has repeatedly assured us that player funds are held in a segregated client account, for the express purpose of storing such funds, in accordance with their licence obligations in the United Kingdom and Alderney. We believe this to be true.

Microgaming does not hold any player funds whatsoever. Player funds are held only by PKR and it is now the duty of PKR’s administrator to return the funds to players.

It is important to note that simply maintaining a segregated bank account for player funds does not automatically mean that player funds will be returned immediately or at all. PKR’s administrator will ultimately decide how to return money to players.

Microgaming’s Commitment

Microgaming is committed to doing everything reasonably possible to ensure that PKR returns money to players and will assist in this process however we can.

We will:

  • Provide regular updates on what is happening. Updates will be posted at the bottom of this blog.
  • Answer questions from the public and press honestly, and as fully as we are able. It is important to note that in some cases we may not be able to disclose – for example, if by doing so we would reveal confidential information or prejudice the administration process. If this is the case we will say that we are unable to answer the question.
  • Co-operate fully with PKR, their administrator, and the legal and regulatory bodies involved.

Although we feel that Microgaming has done everything reasonable to give PKR the best chance of success, we also commit to reviewing our policies and procedures, and the details of this case, to further strengthen our position as a network and software provider.

Update 12th May 2017

PKR has updated their status page with the following statement:

David R Taylor and Matthew R M Wild of RSM Restructuring Advisory LLP were appointed Joint Administrators of PKR Ltd and PKR Technologies Limited on 11 May 2017 by the High Court, Chancery Division.

PKR Ltd Company Number: 1541 Registered in Alderney
PKR Technologies Limited Company Number: 05272650 Registered in England and Wales

All enquiries relating to these companies should be addressed to the Joint Administrators.

Creditors and those with player accounts may contact the Administrators via email to pkr.restructuring@rsmuk.com

The Joint Administrators and their staff will endeavour to reply to all queries as soon as reasonably practicable however, due to the anticipated high volume of emails, responses may be subject to some delay.

Further updates will be posted to this website in due course as and when available.

David Ronald Taylor is licensed to act as an Insolvency Practitioner in the UK by the Institute of Chartered Accountants in England and Wales
Matthew Wild is licensed to act as an Insolvency Practitioner in the UK by the Institute of Chartered Accountants in England and Wales

Insolvency Practitioners are bound by the Insolvency Code of Ethics when carrying out all professional work relating to an insolvency appointment

The affairs, business and property of the company are being managed by the Joint Administrators who act as agents of the company and without personal liability

Update 26th May 2017

Since the last update, Microgaming has introduced a number of interested parties to PKR’s administrators.

Unfortunately, there are no further updates to provide at this time. As soon as further information becomes available, Microgaming will update this blog.

Update 23rd June 2017

Since the last update, Microgaming has remained in productive conversation with PKR’s administrators. However, we have not become aware of any information that would be useful to players. As soon as further information becomes available, Microgaming will update this blog.

FAQs

This section will be updated as and when new questions are received.

NB. These FAQs have NOT been updated since the PokerStars bail out.

Q. Why can’t I play in the games?

A. As a consequence of PKR applying to enter administration, on their request we have blocked gameplay from PKR players on the poker network and in other Microgaming products such as casino games. As agreed with PKR, we have also blocked new deposits, to ensure that PKR players cannot mistakenly deposit into their account.

Q. I’m a PKR player. Who should I contact for further information on this matter?

A. You should contact PKR’s administrator. Please do not contact myself or Microgaming with questions about your account, as Microgaming does not have access to your account information.

PKR has created a status page for interested parties, which can be found at https://status.pkr.com/

PKR’s administrators, David R Taylor and Matthew R M Wild of RSM Restructuring Advisory LLP can be contacted via email at pkr.restructuring@rsmuk.com.

Q. Who regulates PKR?

A. PKR Technologies Limited is regulated in the United Kingdom, for the provision of services to UK residents. PKR Ltd is regulated in Alderney, for the provision of services elsewhere in the world.

The UK Gambling Commission’s website is: https://www.gamblingcommission.gov.uk

The Alderney Gambling Control Commission’s website is: https://www.gamblingcontrol.org/

Q. I’m a PKR player. Where is my money?

A. It is held by PKR. It is the duty of PKR’s administrators to return this money to players in accordance with their licence obligations in the United Kingdom and Alderney. According to PKR management, PKR has stored all player money in a segregated client account. Ultimately, PKR’s administrators will decide how to return money to players.

Q. What is Microgaming’s relationship with PKR?

A. PKR was one of Microgaming’s customers. PKR joined the Microgaming Poker Network (MPN) in March 2016, and shared poker games with other Microgaming customers on the network. Microgaming supplied software and services to PKR, including the provision of the poker network, game integrity services, network management services, and certain other software such as back office tools and casino games.

PKR’s poker clients were owned and developed by PKR themselves, not by Microgaming.

Microgaming had no financial stake in PKR and did not operate any part of the business. Microgaming was one of a number of different suppliers that PKR used.

Q. Why doesn’t Microgaming just refund everybody?

A. It is the duty of PKR’s administrators to pay players what they are rightfully owed. It is not the responsibility of any of PKR’s suppliers to return player money. Microgaming does not hold any player money whatsoever. However, Microgaming will do our utmost to ensure that PKR returns the money that it owes to players.

Q. Why doesn’t Microgaming buy PKR and run the business?

A. Microgaming is a software supplier only, not a gaming company. Operating a gaming company requires different skills, corporate structures and licencing arrangements.

Q. Why didn’t Microgaming inform players sooner?

A. Microgaming first became aware that PKR was seeking professional independent advice on the 3rd May, at around 4:50pm UK time. At that time, the company had not yet applied to enter administration and was not subject to the protection of the court. This protection is very important to safeguarding player funds. It was crucial that Microgaming not take any action which could affect the value of PKR’s assets, since ultimately players are depending on those assets to get their money back. Microgaming has informed the public of the situation as soon as practicable after PKR confirmed that they had applied for administration.

Q. I play with another poker room (not PKR) on the MPN. Does this situation affect me?

A. Not directly. However, you will no longer be playing against PKR players. If you have any questions about this situation or about how your money is protected, please contact your poker room’s support department directly.

Q. I’m a PKR affiliate. What about me?

A. You should contact PKR’s administrators. Microgaming has no records of PKR’s affiliate relationships and cannot advise affiliates on this matter.

Q. Will PKR ever reopen?

A. This depends entirely on how the administration of PKR proceeds, and is not something that Microgaming is able to influence. However, the primary objective of an administration is generally to rescue the business as a going concern.

Q. How can I learn more about how player funds are protected?

A. In August 2014 I wrote a blog about Microgaming’s stance on this subject. It can be found here: https://mpn.poker/blog/mpn-protect-player-funds/

Q. Can I transfer my funds from PKR to another MPN poker room? [Added 8th May]

A. Unfortunately not. Your funds are held by PKR, not MPN. Unless PKR were to enter into a direct arrangement with the other poker room, this is not something that MPN could facilitate.

Alex Scott (@AlexScott72o) is Head of Product (Network Games) at Microgaming, which operates the MPN and Indian Poker Network, and provides poker services to Adjarabet.

Any opinions contained in this blog are the personal views of the author only, and not of any other person or organisation.

Changelog

  1. 5th May 2017 15:10 – First version
  2. 5th May 2017 15:30 – Removed links to inactive PKR Twitter and Support pages.
  3. 8th May 2017 13:30 – Added link to ‘What is administration’ document.
  4. 8th May 2017 14:50 – Added ‘Can I transfer my funds to another MPN poker room?’ question, and link to PKR’s status page.
  5. 12th May 2017 08:45 – Added update 1 with further information about PKR’s appointed administrator, and added their contact email to the FAQ. Tweaked FAQs to refer to ‘administrators’ as joint administrators were appointed.
  6. 26th May 2017 16:40 – Added update 2.
  7. 23 June 2017 15:10 – Added update 3. Updates will now be posted as and when useful information becomes available.
  8. 6 July 2017 17:03 – Added update 4. Players will be able to access their PKR balances via PokerStars.
  9. 7 July 2017 17:10 – Added update 5, with more detail on PokerStars’ bail out of PKR.
  10. 10 July 2017 19:28 – Edits to the July 7 statement, for clarity.

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