Online Poker: Kahnawake Gaming Commission Release Report on UB Scandal

Online poker scandal getting clearer as the Kahnawake Gaming commission has released their findings of an extensive investigation into the cheating scandal of Ultimate Bet. They released their findings in an eleven page report dated September 11th 2009. As you will be aware Ultimate Bet were accused of harbouring a cheating scandal where certain super user accounts that could see the player’s hole cards were used to give information to certain player accounts with the intent of winning money from the virtual tables. For the first time, the gaming commission has put forward an exact number on exactly how much was stolen from the players from their investigation.

The report said that between June 2003 and December 2007 cheating occurred where the player’s rights to a fair and honest game were violated. The cheating was declared to have been initiated before the current owners Tokwiro Enterprises bought the site and that Tokwiro had no prior knowledge of any flaw in the security of the site when they took ownership of Ultimate Bet. The report vindicates the current owners saying that “No Individual identified by the Commission as unsuitable is currently involved in any aspect of Tokwiro’s ownership, management and operations”. Tokwiro have refunded an amount totally $22,054,351.91 to player’s adversely affected by the cheating and this was overseen by KPMG. This is the largest refund ever initiated in regards to online gaming. Tokwiro also paid a $1.5 million dollar fine.

Tokwiro have been permitted to carry on being licensed for online gaming purposes meaning Ultimate Bet can continue trading. They are, however, subject to certain conditions. These include agents conducting periodic checks on the software and code to detect or monitor for any anomalies, any upgrades must be tested by an independent testing facility which the Kahnawake Commission will select, all daily operations for the next twelve months must be passed to the commission including details of financial and gaming records. Because of the difficulties in ascertaining ownership identities of personnel, within 30 days of 11th September Tokwiro are required to file applications for licensing of any person, entity associated with the company in terms of their role as director, key person, shareholder or officer to ensure transparency of ownership. This will reveal whether the professionals who chose to defend the site during the scandal, namely Annie Duke and Phil Hellmuth, have an ownership interest in the site which has been speculated upon during this investigation.

The blame for the scandal was placed at the door of 1995 World Series of Poker Main Event Champion Russ Hamilton. The report suggests he was primarily responsible for and benefited from the cheating. They said the vast majority of the accounts associated with the cheating were linked to Hamilton and money transferred to player accounts was owned or linked via IP addresses to Hamilton. The commission have reported “extensive information” to law enforcement groups regarding Hamilton and “31 individuals who were associated, to varying degrees, with Russell Hamilton, the cheating accounts and/or transactions relating to the cheating accounts”. It remains to be seen whether criminal proceedings will be made against Hamilton or any other party in regards to the cheating.

The online community who reported the cheating are disappointed the names of the 31 people associated with the scandal and Russ Hamilton have not been named. The commission, by not naming them, have left it to Tokwiro to identify the individuals involved which they have not chosen to reveal in the past. The report praised the work of the online community for their policing and investigation into the cheating scandal and said they would play an important part in the future of secure online gaming.

All quotations from this article are taken from the report which can be viewed in full by visiting the Kahnawake Gaming Commission website and downloading the full report.

By Malcolm Clarke

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