Free Poker Tour Is a Dead Man's Hand
We know why you are underground, to many people looking for you.
By this summer, when he received his first e-mail death threat, plenty of people were looking for Matt Sowash. And at him: The Colorado Bureau of Investigation was investigating his Amateur Poker Tour for possible securities fraud. Investors, most of them poker players, had handed Sowash tens of thousands of dollars — their entire savings, in some cases — to buy into the game, believing that they'd all become millionaires. But now the Wheat Ridge company's pot was empty, and there wasn't enough cash to pay employees or give away prizes at the free poker games that APT sponsored at local bars. Sowash's investors realized they'd been bluffed.
Some of them stayed loyal to the company, hoping that if it survived, they might still get their money back. Others pursued legal action or cooperated with the CBI investigation.
Herb Beck took a different route. Back in December, the poker player had given Sowash $36,000 to save APT's first major tournament from collapse. Believing that Sowash had money stashed away somewhere, Beck had since hired a private investigator, Christopher Steelman, to dig up dirt. Steelman and Beck were soon plotting how to extort Sowash, maybe by kidnapping the kids he'd had with his now-ex-wife, Shannon. And if that failed, they had another plan for collecting: They'd buy a life insurance policy on Sowash and kill him.
Their preferred scenario involved rattlesnakes. Steelman would build a three-foot by three-foot by three-foot box and fill it with snakes. They'd kidnap Sowash, force his legs into the box and let the snakes bite him. Then they'd take him out on a hiking trail, remove the box and leave him for dead.
Or maybe they'd tamper with his car so that he'd die in a crash.
On June 18, the would-be killers sent an e-mail to Sowash:
As you know you are also being followed and investigated by CBI, FBI, State, to name a few. You do not have any friends. Which brings me to the point, we have been watching you for sometime and we have documented proof of everything that they want to know about you.
You think what you have been doing is legal! Let us be clear, don't be stupid. You know what you have been doing and now you know that others know.... Never mind about Shannon or the kids, we will tell her, and the kids. We know where they are. Hell, we may even be right outside their front door right now. Just to be clear, we have some interesting photos and live video feed. Now, we know you are a businessman. We will give you one option to resolve this quietly and with no more visits to your family and with no information falling into the wrong hands, which will put you in the hands of some friends that we have in prison.
You will bring $150,000, a small portion of what you have and owe, in cash, and you will start driving west on 44th at 3:30 p.m. You will receive a call, Monday June 18, 2007 at 3:31 p.m. You will be told where to go. You will be given all info on you and your games after pick up and we will be gone. You owe the debt, and it is your choice. Your choice creates the rest of your life. Advice, if you don't deliver, none of you will ever see us coming.
But Sowash didn't start driving west on 44th at 3:30 that day. He didn't even check his e-mail until after 4:30 p.m. And by 6 p.m., he was on the phone with CBI agent Ralph Gagliardi, describing the threat he'd just received.
The game of free poker was suddenly deadly serious.
Brian Masters, head of Denver Poker Tour and the self-proclaimed founder of free poker, is positively giddy as he searches forums on Yahoo and Topix.net for comments about Amateur Poker Tour and the plot to kill Sowash. He reads aloud random posts from around the country that crudely insult the man while suggesting better ways to murder him.
"I love this shit," Masters says, leaning back in his desk chair and folding his hands behind his head. "He's an asshole. Those retards deserve to go to jail. I just don't think they're going fast enough."
The tall, lanky and admittedly crude Masters makes no secret of his contempt for Sowash and his partner, Andrew "Doc" Hicks. He's bashed Amateur Poker Tour on web forums like Denverpoker.com — where a thread he started called "Has the APT gone too far?" has drawn more than 4,400 views — and frequently gets e-mails and phone calls from disgruntled APT employees, dealers, debtors, investors and players. There are three tape recorders on his desk that he uses to capture most of these conversations; he presses "play" on one. It's a former APT dealer who wants to deal for DPT now. "Why'd you leave APT?" Masters asks, unable to mask how much he enjoys asking the question. The dealer says something about not getting paid.
Masters thinks it's just a matter of time before APT bleeds itself out of business. He won't be sorry to see it go and thinks most of the investors got what they deserved, but he's worried about how the debacle will affect the booming free poker industry. "There are a bunch of people saying, 'Oh, that Brian Masters, he's jealous, and if he wasn't such a dick he wouldn't have competition.' If that's your opinion, go ahead," he says. "I'm not here to be liked. I don't care. I am here to protect the industry, and the industry's taking a hit right now because of what APT is doing. I'm not losing my business because a bunch of idiots decided to screw the market up for everybody.
"I created free poker. Flat out. That's arrogant. That's cocky. I'm the first guy in the nation ever to do this. And as much as the competition hates me, they have to say, 'Yeah, he was technically the first.'"
Masters grew up in Orlando and moved to Breckenridge in 1990, fresh out of college and looking for a change of scenery. In 1997 he started a company called Casino Masters that did private parties, and since there often wasn't much to do on summer nights in the mountain town, he'd use Casino Masters' equipment to set up a poker table at a bar, where he'd play with friends — sometimes seven nights a week. "Everybody ponies up five bucks and we just have fun," he recalls. After a while, people started approaching the table, asking if they could play. Masters would tell them no, it was a private game. But people still persisted. "Look, we just want to play," he'd say. "Leave us alone. We don't know you. We're just kind of dickin' around here for five bucks."
"Well, the bar owner finally comes over to us one day and says, 'You know, you've got a lot of people here that want to play poker.' I'm like, 'Well, I don't really care. We're here to have fun with our friends.' The bar owner goes, 'Tell you what, if you're going to drink, why don't I pay you to let them play in your game?'"
If they opened it up to anybody, Masters told him, it wouldn't be a private game anymore and they couldn't play for money. "Then play for fun," the bar owner suggested. "Play for bar tabs."
In 2003, after thirteen years in Breckenridge, Masters moved to Denver. He wanted to play softball, watch pro sports teams and see good movies. "Basically, I wanted to get laid," he admits. "I wanted to meet the right girl. It's a seven-to-one ratio; you couldn't date up there." He also thought that there'd be more opportunity in the city for Casino Masters and a new venture: Denver Poker Tour.
He was right. This was the year that poker exploded, particularly the no-limit brand of Texas Hold 'em featured at the annual World Series of Poker. WSOP had been around since 1970 and shown on television for almost that long, but 2003 was the first year ESPN covered the action leading up to the final table, the second year that the network employed a pocket cam showing spectators each hand. Suddenly, poker players were celebrities, with their every fold, call and bet scrutinized by professional commentators. And in 2003, Chris Moneymaker — an accountant from Tennessee who had never played a live tournament before — qualified for WSOP over the Internet and wound up making it to the main event, winning the $2.5 million grand prize. Amateurs around the country who'd learned the game by watching TV, studying books and playing on the Internet suddenly thought they had a shot at the big leagues.
Masters found a lot of those people in Denver, a Western town with a rich, romantic history of gun-slinging gamblers. Instead of playing on their home computer or driving up to Black Hawk, these people could now go to one of Masters's free bar poker games, where they could practice and pretend at no-limit Hold 'em, nervously going all in with $3,000 on an ace-ten. Just because the bet wasn't real didn't mean it wasn't fun.
"The first bar ever to have poker on the Front Range was JD's Bait Shop," Masters remembers. "We showed up thinking we were going to have twenty people, thirty people. We had a hundred people pulling up the first night. Everybody just wanted to play. They thought it was the coolest thing to hit the world. That first week, we had three or four games already lined up. The second week, we were up to fourteen. The third week, I think we had twenty. We've been sitting on over a hundred games a week for the last three years."
Today Denver Poker Tour hosts over 150 games a week in Denver, as well as games in Fort Collins, Colorado Springs, Grand Junction, Kansas City and St. Louis. If you type "poker" and "tour" into Google, DPT is the third hit — behind World Poker Tour and World Series of Poker. Between sponsorships and bar payments, Denver Poker Tour makes over a million in revenue each year from free poker. "All because a bar owner said, 'I want you to let these guys play,'" Masters marvels.
Once he'd opened the door, other poker companies started popping up in Denver. Including APT, there are about a dozen now — a handful of which are reputable, Masters says. He claims one of the first came along after he dropped his checkbook; the man who picked it up got a look at the register and wanted to know what he did.
Masters soon noticed companies starting in other states, too, some of which seemed to be copying his game. He knows of just one that started independent of his business, and about the same time: Kansas-based Amateur Poker League, which is hugely popular in Texas and Florida, a market Masters is now trying to break into. "I'm going out of town, back and forth to other cities, and poker is just getting started, where Denver's had it for four years," he says. "Denver alone has more games in one night controlled by the DPT than most states have, total."
APL held its first game in Wichita in July 2003, went national in November 2003, and now holds 600 games a week in sixteen states, including Colorado. Its biggest market is Dallas, where it holds 25 games a night. Both DPT and APL claim to be the biggest in the business, but there's a crucial difference between the two. "The Denver Poker Tour uses dealers, where we don't," explains APL vice president Kurt McPhail. "Our players pass the deal."
Like Masters, McPhail says that his company grew out of boredom with the nightlife scene. It's been growing exponentially ever since — as have the number of competitors — and McPhail thinks they've only scratched the surface. According to Jim Thompson, owner of Omaha's In-House Poker League, APL brought free poker to his town four years ago. "I know the guy in Denver's been doing it for a long time," Thompson says, "but when it came to the forefront and really came national, it was the Amateur Poker League." Thompson and a friend started a tour for fun, which it continues to be, since the game doesn't make enough to hire dealers. "It's not about the money," he says. "It's more of a social interaction, have a couple of nice cold beers and play with your friends."
Jim Baxter, owner of a DJ-equipment company called Colorado Sound 'N Light, had never heard of free poker before Masters introduced it here. "Denver Poker Tour was the first," he says. "I went to a couple of their games, and a friend of mine in Kansas said, 'Jim, you better jump on this.'" He did, starting ColoradoPoker.tv three years ago and holding what he says was the first tournament in which the winner got a seat at WSOP. He recently sold the tour to a player so that he could focus more on his core business. "These people, they're hooked," he says. "They play religiously."
Dan Hartman, acting director of the division of liquor and tobacco enforcement in the Colorado Department of Revenue, has noticed the growth in free poker games at bars around the state. Because these games are free, they don't qualify as gambling and so are legal. Gambling is defined as having three things: chance, reward and risk (or consideration). "There were some that were pushing the envelope of taking some kind of consideration or had to have a buy-in, and for the most part, I think most of those aren't around anymore," Hartman says. "Consideration doesn't always have to be money. It doesn't have to be cash on a poker table. There are all kinds of things that can fit into that gray area. The good operators pay attention, and when they're trying something new, they may give us a call. And that's certainly the best course of action."
Run properly, bar poker is just another form of entertainment, spurred by the "explosion of poker" on ESPN, Hartman says. "As long as it stays within those frameworks, it's fine. It's when it mushrooms out and violates the law, that's when CBI takes a look to see what's going on."
The concept of free bar poker sounds so simple: Bar pays tour to deal poker game, players pay bar for drinks while playing, bar makes profit, tour makes profit, players have fun playing poker (sometimes winning prizes). Who would have thought that it would also include bouncing checks, bogus Vegas trips, hackers, pissing contests between tours, bars being stolen by tours from tours, and the list goes on. — August 7 post on DenverPoker.com.
Mark Cross, who today runs All-in Series Poker, started Amateur Poker Tour, sort of. He actually started Amateur Series Poker, which was APT's original name, and has the shirts to prove it — with a logo featuring a snake curled around a card. He uses the same logo for All-in Series Poker. The snake is a cobra, not a rattlesnake, but it's close enough that people who've heard of the murder plot want to buy his shirts.
Originally from Michigan, Cross moved to Denver from Venice Beach in 2001 and started a NASCAR collectibles store that failed after three years. In need of a job, he learned how to deal cards from a longtime friend. With her help, Cross got a job working for Masters. He dealt for DPT for thirteen months, until he showed up late to one game and Masters docked his pay by half. Cross didn't think that was fair, so he left and started his own tour in early 2006.
Cross is a short, soft-spoken man. He reads his chronology directly from a computer screen, where he's kept a timeline of all APT events at a lawyer's suggestion.
In May 2006, a player named Andrew Hicks started coming to Cross's games. Cross had met Hicks when he was dealing for DPT, and the player had left a good impression. When the girl with Hicks had gotten in a fight with another woman — a fight that had stopped the game and brought the cops — Hicks had tipped Cross $10 for his trouble.
A frequent player, Hicks was liked in the free poker community. But aside from the fact that he was friendly and tipped well, no one knew much about him. Cross had heard that he was a stockbroker. Lori Meyer, a former APT employee who now works for DPT, thought he sold insurance. They'd all heard that he wanted to start his own poker company and was looking for investors.
Hicks soon found a partner, Matt Sowash, who lived in the same Wheat Ridge apartment complex and worked as a broker. Sowash had grown up in Pennsylvania, and lived in Steamboat Springs for a dozen years before moving to Denver. He was not a poker player; he called the game "boring." But Sowash was extremely outgoing and told people he used to work in law enforcement — without mentioning the long list of money and breach-of-contract claims that had been filed against him around the state.
By September, Hicks and Sowash were coming to Cross's games together, saying they planned to start a company that hosted free games but made its money on Internet gambling. "The catch to get me to invest was not the local table games," Cross reads from his laptop. "It was to get money from a site they were going to run called SmartAcePoker.com. They were showing us the numbers to the online gaming thing, and they were huge. The point of the local games was to try to drive people to the money games. That was the original concept of how the thing was supposed to work."
Sowash showed Meyer the same site. She says he was a convincing salesman: All he had to do was look at people with his big blue eyes, tell them "I don't lie," and they believed him. "He was doing it with a company offshore, and he was going to make $25 million a year," she remembers him telling her.
Lured by the popularity of online gaming, Cross gave Hicks $6,000 — selling part of his stamp collection to do so. "This company started when I gave them the first check," Cross says. They decided to keep using the name Amateur Series Poker, and Cross continued dealing at nightly games while Hicks and Sowash concentrated on the business side of what they called a "marketing and promotions" company.
When his new partners asked Cross if he knew anyone else who might be interested in investing, he suggested April Osborn and Robert Breckley. Osborn was the friend who'd taught Cross how to deal, and Breckley was her partner. The couple wound up giving them a check for $50,000 — the entire nest egg they'd set aside to send their kids to college and cover any of life's unexpected expenses.
"He made a good pitch," Breckley says of Sowash. "At the time, the poker industry was exploding. Every bar was holding new games. It was all over ESPN, so it seemed like a very good investment. Even if it wasn't thousands of dollars a month, you make a couple hundred a month running the game, and divided amongst investors, what is that? Seventy bucks a month. Not great, but not bad for an investment you don't have to do any work on."
In November, Sowash and Hicks asked Cross to give up rights to the name Amateur Series Poker. He refused, but he stayed involved with what became Amateur Poker Tour. "Mark was always a silent partner," Sowash says. "He didn't do a whole lot other than deal. It got to the point where he became more of a hindrance. He had this stupid idea. He wanted to use the picture of a snake — I guess an 'asp' is a snake — as part of the logo."
The company made other changes, too. After the Unlawful Internet Gambling Enforcement Act became law in October, barring banks from transferring money to gambling sites, Sowash says he revised his original business plan to get rid of Internet gambling. Still, as late as December, the newly renamed APT was directing players to the Curaçao-based SmartAcePoker.com, where they could play for free to qualify for a local tournament. (Sowash denies ever having owned or run the site.)
That tournament was scheduled for the Denver Airport Marriott on December 10. But before then, the company started showing signs of trouble, including bouncing checks. "I should've seen it coming," says John Wemhoner, who was hired to build tables. "They didn't have money to buy supplies."
That's when Herb Beck, a regular player, stepped in with his $36,000. "He saved APT's rear end when he came forward to help with the Marriott," Cross says. "They did not have chips, tables, the venue paid for. He came forward and made sure their first big tournament went on."
The tournament would have gone on with or without Beck's money, Sowash says. "We had other options we just didn't want to use," he explains. "It turns out Herb was the most expensive option we had."
The money came through just in time for Wemhoner to build 28 tables; he didn't sleep for the three nights leading up to the tournament.
A girlfriend of an APT employee "won" the tournament. Her prize was a Land Rover Discovery — a lease, it turned out.
But players didn't know there were problems behind the scenes, and they praised the APT games. Several APT dealers had come over from the rival Denver Poker Tour but were more friendly than Brian Masters, they noted on the web forums. By March, the company was hosting more than a hundred games a week at a total of 41 venues, including Club Zodiac, Deuce's Poker Room, 44th Ave. Grill, Scotty Dawgs and the Frontier Inn. Adding to the tour's popularity were $10,000 prize pools at monthly tournaments, as well as free trips to Vegas. Legally, the tour could give away whatever prizes it wanted to as long as the players didn't have to pay to join a game. APT even published its own magazine, where it congratulated tourney winners, advertised trading cards for players and claimed to be creating a reality show for the Spike network.
"So fun, you can hardly believe it's legal," APT's web page pronounced. "The world of poker is yours to conquer, and you can learn it without paying a dime. Where else can you have a chance at $5,000 without risking one dollar? Win $10,000 for the everyday low price of nothing. Get a $40,000 automobile without spending one dime."
People didn't just want to play; they wanted to get in on the business. "Several of the investors are players," explains Karlynn "KC" Clark, one of the original dealers. "So they come in and they see the tables, and they see that we're all over and how big and fast APT was growing, and 'I want to be a part of this,' and 'I love this tour.' You give away big prizes, and you have big games and lots of fun."
The prizes were so big they were unprecedented, and impossible for other tours to match unless they were willing to operate at a loss.
On April 23, APT's problems went public when the CBI raided its offices, seizing records as part of an investigation into suspected illegal gambling operations. A tip passed down through the Colorado Division of Gaming sparked the investigation; the CBI won't discuss details of the tip. The APT partners blamed it on Masters, while others speculate that APT's own advertising probably led the CBI to its door: APT had been selling $200 VIP memberships to players in exchange for priority seating and entry into an exclusive tournament. After the raid, APT temporarily suspended the VIP program and canceled the private tournament.
The raid came a week before an "international tournament" that APT was scheduled to hold in Las Vegas at Binion's casino — formerly the Horseshoe, "the place that made poker famous," and current home of no-limit Texas Hold 'em and World Series of Poker. Playing in this event was not free; APT was charging $250 for a travel package that included hotel and airfare, and there was also a $500 buy-in for the tournament. The company hoped to make $150,000 in one night, and by the end of April, APT had collected the $250 travel fee from nearly 200 people. (Several players also paid their $500 buy-ins directly to APT, until Sowash realized that "probably was not something we should be doing," he says.)
After the raid, when panicked players called the hotel to verify their reservations, they were told that the tournament had been canceled. But APT kept insisting that it would go on. Sowash says the Nevada Gaming Commission told him that in order to host the tournament, APT would need a letter of exoneration, and he worked on getting such a letter — unsuccessfully — from the CBI or the Jefferson County District Attorney's Office up until the day players were supposed to fly in on a plane chartered by APT.
Cross had inquired about the status of the tournament numerous times, he says, and had always been told that it was still scheduled. When he arrived at DIA for the chartered flight, Hicks and Sowash were already in Vegas. But fifteen minutes before boarding, a dealer pulled Cross aside and whispered that the tournament was off and that none of the rooms were paid for because the casino wouldn't accept a check from APT. "Please don't say anything so we don't have to give people money back for their flight," Cross says he was told.
It wasn't until the plane was in the air that the dealer announced that the tournament had been canceled and that everyone would have to pay for their own rooms. (At the time, Sowash claims, he was still trying to find another venue for the tournament.) Once they arrived at Binion's, players were told they had to remove any clothing with the words "Amateur Poker Tour" on it or leave the casino. Binion's confirms that the APT tournament had been scheduled for the casino, but will not comment on the reason for the cancellation.
Back in Denver, APT partners continued blaming Masters for their problems. But the players grew skeptical as prizes were slashed and more tournaments canceled. Those who'd been told they'd be reimbursed for the Vegas trip had to wait for checks — and when they came, many bounced. So did checks to dealers and other employees, as well as the $38,000 check to Frontier Airlines for that charter flight. (Frontier has since filed a lawsuit against APT.)
Sowash denies accepting any new investment money after the failed Vegas tournament. "Every investor knew exactly what the financial numbers were," he says. "We had investor meetings every week or every other week. Nobody was in the dark."
But Meyer claims that Sowash continued to raise money. At least a dozen total investors bought into the company, with several paying as much as $100,000. "It could be upwards of one million," she says of the amount raised from investors. "I know for sure of at least $500,000."
Since APT was no longer selling VIP memberships and the company charged bars so little and did such a poor job collecting on those accounts, the only money coming in was from investors, she says. "When I was in accounting, all the cash that came in, almost 100 percent, was directly to Matt and never made it to the bank," she adds.
According to Sowash, "99 percent" of the money coming in went to the company, but he and Hicks would then use APT's accounts to pay rent, child support and travel expenses and to buy food. "Almost all of it would go through the company first, and then I'd expense it through debit-card purchases or a check written to my landlord," he explains.
By this summer, Breckley and Osborn were very worried about the company. "We'd call them every day to find out what was going on, where our finances were going," Breckley says. "We were always given the same line of, 'Everything's fine. You don't need to know anything.' And they treated it like, 'Oh, $50,000. That doesn't mean anything.' But it meant everything." When he went to the APT office, he was asked to leave when a meeting was about to start.
Jesse Mower, an APT dealer who invested $10,000 — his entire savings — in the company, was told he was a "debtee" and not a real investor, and was also kicked out of meetings. "I've never invested in anything," Mower says. "I wasn't a business-type person. I'm a laborer. To me, it looked like a good opportunity, with all the talk of everything going on." By May, Mower had asked for his money back. This summer, he lost his house. "I basically lost my money, and I'll probably never get it back, and I don't know what can possibly be done to try to get it back," he says.
Breckley and Mower weren't the only investors fearful that they'd never see their money. In June, Herb Beck started coming around the APT office, saying he was going to "take over" APT. Cross remembers Beck talking about getting the investors and employees together to "come up with a plan for how to go after these guys," meaning Sowash and Hicks. Beck was even asking people to give him their powers of attorney, but he wouldn't tell them why. Cross says he stopped dealing with Beck because he couldn't figure out what he was up to.
"He was pretty much known around the office as being all talk," Meyer says. "Guess that's not true anymore."
Behind the spidery cracks in the double-pane glass at the Jefferson County Jail, where he's incarcerated on a $500,000 bond, Herb Beck takes off his glasses to rub his red eyes as he starts to cry over the gravity of his situation.
This is not the first time that Beck has gotten himself into trouble, but it's certainly the most serious. In the past, according to his arrest affidavit, Beck had been arrested on charges of larceny, forgery, fraud, assault, resisting arrest and trespassing. In July, he was kicked out of the Lodge Casino in Black Hawk when he started a fight with another player over the seat he wanted closer to the dealer. In April, he was arrested for assaulting his lawyer's wife, who worked as a receptionist for her husband. Beck was reviewing a file when she told him he couldn't remove anything without the office first making copies; he became angry, and as she tried to leave, he threw her into a doorway, causing a head and back injury.
Meyer doesn't remember Beck being violent. At games, he always talked about how he had all this money — he worked for himself and owned real estate — and wanted to be a part of the tour. "I had a choice back in the first week of December '06, whether to let these guys fall on their face or to help them," Beck says.
He now regrets the choice he made. "I'm very angry about what's happened," Beck says. "Most or virtually all of what's been presented is not the truth. They really have nothing substantial. Wheat Ridge police, CBI and FBI have not pursued any of the complaints that I've had."
But CBI agent Ralph Gagliardi did pursue complaints about Amateur Poker Tour. It's just that his investigation got sidetracked when he discovered that two men were plotting to kill the subject of that probe.
According to the arrest affidavit, Gagliardi started his investigation in March, following up on allegations that APT might be involved in professional gambling. Soon his inquiries morphed into possible securities fraud. In May, he began contacting APT investors, including Beck. Beck seemed concerned about his investment and spoke to Gagliardi numerous times on the phone. They set up three meetings that never occurred. "Beck would cite schedule conflicts and other pressing business," Gagliardi notes in the affidavit.
When Gagliardi met with Robert Breckley for the first time on June 18, the conversation turned to Beck. Breckley told the agent that earlier that month, Beck had asked him to write a letter giving the FBI permission to "look around" the APT offices. Breckley had told Beck that the FBI could get a warrant if it wanted to search the office. "With this, Beck stuttered and said the FBI didn't have enough information for a search warrant," the affidavit states. "Breckley told Beck if the FBI wanted to search the office they could call him directly. After making this statement, Beck changed his story, telling Breckley it wasn't actually the FBI needing permission to enter the APT offices but a private investigator he hired to check into APT."
The same day Gagliardi talked to Breckley, he got a call on his cell phone from Sowash — whom he'd met back in March, when he started the initial APT investigation.
Sowash read Gagliardi the e-mail he'd just received threatening him, his ex-wife and his children if he didn't pay its authors $150,000 in cash that day. The subject line of the e-mail was "Family in PA" — which is where Sowash's family lives.
Gagliardi told Sowash to contact the Wheat Ridge Police Department.
Just after midnight, Sowash received a second e-mail with the subject line "Game Over."
"I suppose you think this is a joke!" it read. "I guess you don't mind going to prison. I'll send everything I have to the CBI tomorrow, Tuesday June 19th 2007 at 4:00PM. Good luck in Prison!!!!!"
A third e-mail, sent at 2:20 a.m. on June 25, said: "Just strolling thru PA!, anyone I should visit?"
A few days later, Christopher Steelman arrived at the APT office. He told Sowash that he was a private investigator working for Beck, and showed him a key to the APT offices. He said Beck was behind the threats Sowash had received, and that he had a tape recording to prove it. He'd sell the tape to Sowash, Steelman said, adding that he needed money because Beck still owed him $12,000 for background work on Sowash.
Sowash told him he wasn't paying for the tape, and asked for Steelman's cell-phone number so that he could call him later.
On July 12, Sowash agreed to meet Steelman at a Village Inn, where Steelman played the tape. He said he wanted Sowash to know what Beck was planning because it involved killing not only him, but his ex-wife and kids, too. Steelman didn't want any part in harming the woman or children, he told Sowash. As he was leaving the restaurant, Steelman told Sowash to have the CBI contact him if they needed more information. Sowash recognized the car Steelman was driving as one of Beck's.
The next morning, Gagliardi had an appointment with Sowash "for the purpose of gaining further insight into APT's financial structure." Instead, Sowash told the agent that while he'd never called police about the threats, he'd received more and now knew who was behind them.
Using the number that Sowash provided, Gagliardi called Steelman at 11:24 a.m. By 11:45 a.m., Steelman was at the CBI office in Denver, spilling his guts.
He'd met Beck back in March when he was hired to repossess a vehicle from APT, Steelman said. The first week of June, Beck had contacted him and asked him to get background information on Sowash and his family. At that point, they were talking about "beating Sowash up," Steelman said. By the second week of June, they were talking about ways to "make Matt die," including using a box filled with rattlesnakes. Steelman said he helped Beck with the language of the first threatening e-mail sent to Sowash because Beck's initial tone was "too harsh."
When Sowash failed to respond to that e-mail, Steelman said, Beck came up with a plan to obtain "key-man life insurance," a third-person policy covering a key-company employee, on Sowash. On a trip to Vegas on June 22, Steelman and Beck discussed how to get the policy. Beck said he would have to convince the other APT investors on the idea; he wanted them to pressure Sowash into a medical exam, which he thought was a prerequisite for obtaining such life insurance.
The following week, Steelman recorded a conversation in which he and Beck discussed murder. On the tape, Steelman says he's going to have some other guys take care of "it," but that he'll go over everything with Beck first. Beck talks about making contact with the other APT investors, but thinks that might be awkward. Perhaps telling Sowash that his kids and wife are going to die first will make him pay up, Beck suggests.
While Steelman was at the CBI office, Gagliardi learned that he had an outstanding failure-to-appear warrant. He took Steelman to the Jeffco jail. Steelman called Beck to bond him out, which he did.
On July 25, Gagliardi went to visit Beck at his home. He told Beck that Sowash had reported an extortion attempt and several threats, and that the investigation was now in an awkward position, since the suspect was now a victim. "Beck opined that maybe law enforcement wouldn't 'care' about the threats made against Sowash," the affidavit reports.
Gagliardi showed him the first e-mail sent to Sowash. "Interesting," Beck said.
When Beck told Gagliardi that he didn't know who'd threatened Sowash, the agent said that Sowash thought it was Beck. Gagliardi asked Beck if he'd written the e-mail or asked someone else to, and Beck said no.
"Let's put it this way, I wouldn't mind if anything happened to Sowash," Beck told Gagliardi as the agent was leaving.
A few hours later, Gagliardi returned with a search warrant. Beck now admitted lying about the e-mail. He'd helped Steelman write it, he said, but never wanted it sent. He never intended to kill Sowash, only to scare him into giving him his money back.
Asked what method of killing or hurting Sowash he'd discussed with Steelman, Beck told Gagliardi about the rattlesnakes. The "snake box" was Steelman's idea, he said, but he'd embellished it. He'd researched rattlesnake bites on his computer and found that "85 percent of the time the person is harmed or killed."
The arrest warrants for Beck and Steelman were signed three weeks later. Steelman was arrested on August 15 in Lakewood; Beck was arrested on August 16 in Raton, New Mexico. Both are due in court on September 26.
Steelman has continued to point the finger at Beck, saying that at first he thought the plot was just the venting of an angry man, but then he warned Sowash when he realized Beck was serious.
Beck maintains that Matt Sowash and Andrew Hicks are the real criminals.
I am planning a trip to the prison that Matt will be at ... I just want to sit at the glass and laugh while we point our fingers at him. I also thought we could bring some fake snakes to leave with him.
Let me know.... — a post from John on DenverPoker.com.
With or without a murder plot, APT was already acting snake-bit. In July, the organization was evicted from its offices for non-payment of rent. In mid-August, an APT car was firebombed at a poker game. (Rumor has it that the owners were hoping to collect insurance money.) Bars started leaving the company in droves, including a couple that were also investors. And on August 17, the day after Beck's arrest, Amateur Poker Tour posted a message on its web page stating that it had turned over management of the live nightly games to APT Stars, LLC — a separate company with a separate owner.
Andrew "Doc" Hicks sent a letter of apology to all former APT employees, saying that he was committed to paying them what was owed but would be unable to do so if the company went out of business. "The truth of the matter is that even before Vegas we had to borrow money to make your payroll," he wrote. "Vegas didn't happen as we had hoped and we kept having to borrow money to make your payroll. That is no way to run a business.... We thought we had funding arranged to keep the payroll going but it is hard to get people excited about investing in a business that doesn't make a profit!... We didn't have the balls or the heart to tell you the business was dying, or maybe we just wanted to believe we could make it work out."
Hicks and Sowash hosted Amateur Poker Tour's farewell tournament at Patricia's Sports Bar in Fort Lupton on August 25. They'd been advertising a different tournament for that weekend — their regular monthly event at Club Zodiac in Westminster — but Zodiac, an APT investor, wasn't doing business with APT anymore. On the last weekend in August, Zodiac offered a tournament hosted by a new poker company, one led by a former APT employee. By the next monthly tournament weekend, Zodiac would be closed.
In spite of APT's problems, nearly 200 people turned out at Patricia's, with supportive investors like Doug and Stacy Birkby — who'd started out as players — helping to organize the games. "I know the people that started this company, and while their aspirations and goals were probably set unrealistic and described so, I don't think it was any type of scam," Doug Birkby says. "I think part of the problem is that you get in a business like this where there's several poker tours out there all competing for the same business, and there are going to be rumors spread that aren't true. There's no doubt the company has suffered some setbacks, but all the investors still are confident that it will get a good return going forward."
But fifteen minutes after noon, the scheduled start time, the tournament had yet to get under way. Jane Parks stood off to the side, on a waiting list. She was one of 190 players who'd won an APT game over the previous two months, and she was there to compete for a $1,500 prize pool — a fraction of what the tour had given away in earlier months. Just as Jane said she'd heard that APT dealers weren't getting paid, a dealer she knew came up in a huff. "They asked me to deal," he told her. "I said, 'Are you going to pay me? Today?' They said they'd work something out." But he told them no, that APT wasn't a charity and he wasn't going to volunteer to help them profit.
In his trademark backwards baseball hat, Hicks looked like a big, flummoxed teddy bear when he finally announced that the tournament was starting. He walked up and down the two rows of twenty tables, yelling over the chatter, saying that the dealers were going to deal and also play. A few people groaned.
This would be the last hurrah, Hicks said, the final game that he and Sowash would manage. They'd be giving out $750 in cash — half of what their website had promised — and clearing out all their merchandise: shirts, hats and fleeces. "Whatever you've heard is not true," Hicks said. "We're not going out of business or involved in any securities fraud."
Asked about the CBI investigation, Hicks refused to talk. "No investors lost any money. You can quote me on that," he yelled as he walked away.
In another room, Sowash stood alone, guarding a section of bar tables covered in APT merchandise. "Matt Sowash isn't here," Matt Sowash said. "Maybe I can help you. What do you want to know?"
Asked about the CBI investigation, Sowash said that there were ten owners who'd bought into the company, and the CBI was making sure their money did in fact go through the company. "Which it did," Sowash said. The original allegation, brought up by "competitors," was that APT was an illegal gambling operation. "CBI searched our office," he continued. "No charges were ever filed. Since then, the CBI continues to get phone calls trying to discredit us."
The company was having "financial trouble" stemming from the canceled Vegas tournament in which it had invested $150,000. "It was a tremendous financial hit," Sowash said. "Most companies would have gone under right then."
As for Herb Beck, he'd approached APT in November wanting to invest. He came in with $36,000 and "other promises to advance the company," Sowash said. Those promises never materialized, and management decided to part ways with Beck, structuring a $60,000 promissory note that included interest and paying him $10,000 up front: "Then two weeks later, he started making his death threats."
After admitting that he was, in fact, Matt Sowash, the subject of those threats, he shrugged them off as no big deal.
Just like the game that had inspired those threats. "I hate poker," Sowash said, smiling. "I'm like the bar owner who doesn't drink."
At this point, Hicks approached. He told his partner that they didn't have the $750 that he'd just announced they were giving away. They were $150 short.
Not to worry. APT still has big plans. Letting go of the live games will allow the company to focus on its next project: television. "We never really wanted to run a poker tour in the first place," Sowash says. "We wanted to use it as a marketing tool. It blew up so quickly in terms of expansion and popularity that it became its own animal."
Investor Scott Lapoint says APT already has a deal with Fox Sports Net to telecast live tournament play (FSN's local and national offices both deny any deal with APT), and the only thing that threatens the company now is bad publicity. "I'm not saying there haven't been some mistakes made," he notes, "but every investor is never going to see a dime coming back to them if we're not given the opportunity to get things turned around."
Sowash blames the company's failures on his own bad business decisions, like not firing enough staff after Vegas, and says allegations that he and Hicks set out to swindle investors are ludicrous. "If we lined our pockets, then it's stuffed in a mattress somewhere," he says. "It's not put into the places we live, not in the lifestyle. Everybody has lost on this thing. You can throw your hands up in the air or keep pushing forward and try to take care of all the people that have taken care of you. That's what we're doing."
The APT website says the company is not only still in business, but will soon make its Colorado television debut, with tournament shows, game shows, talk shows "and much more!"
The CBI's securities-fraud investigation is ongoing.
"Hope to see you on the tube!"
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