Full Tilt Poker has been accused of paying "phantom funds" to its players using players' funds to pay out hundreds of millions of dollars to its owners in the latest complaint filed by the US Department of Justice.

In its filing, the DOJ said that Full Tilt had "not only engaged in the operation of an unlawful gambling business, bank fraud, wire fraud and money laundering" but had also "defrauded" its poker players by claiming funds deposited into online player accounts were secure and segregated from operating funds.

The DOJ alleged that in the summer of 2010 the company’s payment processing channels were so disrupted it faced difficulty attempting to collect funds from players within the US. Rather than disclose this fact, it said, the company credited players’ online gambling accounts with money that it had not in fact collected from the player’s bank accounts.

"Full Tilt Poker allowed players to gamble with - and lose to other players - this phantom money that Full Tilt Poker never actually collected or possessed. When other players won these phantom funds, their accounts were credited with money that Full Tilt Poker did not actually possess, but now nevertheless owed to these players."

The DOJ stated that, as of March 2011, Full Tilt owed approximately $390m to players around the world, including around $150m owed to players in the US.

It is alleged, meanwhile, that between April 2007 and April 2011, Full Tilt and its board of directors distributed approximately $443m "to themselves and other owners of the company."

Responding to the DOJ’s action against Full Tilt, Frank Fahrenkopf, president of the American Gaming Association, said: "I have two simple questions: how much and for how long? How much money that we don’t know about is being swindled from US consumers and how long will it take before we change laws to protect those consumers?

"This morning we called on Congress to institute an effective online poker regulatory system to protect American consumers and released an online poker code of conduct that would ensure online poker companies are operated honestly, legally and responsibly.

"This afternoon the DOJ accused one of the most well-known offshore online operators, Full Tilt Poker, of bilking players out of more than $300m. The US attorney who made the accusation called Full Tilt Poker ‘not a legitimate poker company, but a global Ponzi scheme.’

"Tomorrow Congress should begin changing the laws to protect consumers from such schemes."