I am very pleased that a lot of the details of this investigation have been released. Specifically, I am very happy that the entire list of user names was included in the release, as I know many of our customers have been patiently waiting for this.
If players have any questions relating to the refunds please contact our Poker Security department at pokersecurity@ultimatebet.com or call 1.888.200.2933.
It is very important to us that everyone understands that our company had nothing to do with the cheating on UltimateBet. The people involved worked for UB prior to Tokwiro (UB’s parent company) buying the business in October 2006. The KGC’s findings reinforce this fact.
Though the findings are pretty comprehensive, I am aware that the KGC release raises some new questions for the poker community. I wanted to provide some insight into those questions and concerns today.
The Limits of the Investigation
Throughout the investigation we questioned as many people as possible trying to determine things like: who built the software, who benefited financially from the cheating, who else might have known about the cheating, etc. Unfortunately, every door we knocked on gave us very little additional information that we could use.
This limited the Tokiwro and KGC investigations because the only evidence available was data. Tokwiro is a provider of online gaming services and the KGC is a regulatory body for the gaming industry – neither are police forces and do not have the ability to interrogate or interview individuals in the same way as a typical law enforcement agency would.
The Additional 31 Names
In the KGC’s report, they make reference to providing the authorities with a list of 31 individuals who were associated with Russell Hamilton, the cheating accounts and/or transactions related to the cheating.
I have not seen the specific report that they provided, but I can make a very educated guess as to which names were included.
I realize to some people it now sounds like there was a group of 31 persons who conspired to cheat. However, in my opinion that is not what the list of 31 persons represents.
Since the investigations were limited to mainly data, it is very difficult to prove how much knowledge someone had about the cheating or how involved they might have been. The list of 31 individuals represents a lot of people that fall into this category. I believe this list includes names that:
Benefited from the proceeds of the cheating in any way
Enabled the cheating by changing the user names of accounts
Enabled the cheating through excessive player-to-player transfers
The cheating accounts were registered to
Might have been involved in developing the software
In my opinion, this is most likely a list of everyone who might have been involved, or should be questioned in greater detail by authorities, as their testimony would be very important to determining exactly what happened.
Legal Complexities
I will not go into too much detail about this subject because I am not a lawyer. However, I think it is very important to mention that the current legal environment in the United States, relating to online poker, makes it very complicated for the proper authorities to work with us and for us to bring a claim against individuals in the United States.
The regulation of online poker in the United States is very, very necessary because of exactly this type of jurisdictional complication. Online poker will continue to thrive across the world because of the popularity of the game, its flexibility and its convenience. Land-based poker is an amazing game too but it involves leaving your home, wait lists, and has a limited offering of limits and games. Online poker allows you to enjoy games for whatever limit your budget allows, you never have to worry about waiting, and you never have to leave your home.
If everyone agrees that players will continue to play online regardless of the legal environment in the US, which I think most people recognize and agree with, then it is extremely important that it does become regulated in the United States. The global regulation of online poker will protect US citizens from situations like this, when a crime is difficult to investigate and prosecute. If online poker was regulated in the US, multinational regulatory bodies could fully cooperate and share information when incidents like these occur.
Russell Hamilton
Many people have already asked why only Russell Hamilton’s name was released and not the others. In my opinion, the KGC released his name because there was an overwhelming amount of evidence that showed he was the person using the software and accounts to cheat, that his close associates helped facilitate the changing of usernames and the movement of monies, and that he was the main beneficiary of the proceeds from the cheating. This overwhelming evidence and the need of the poker community to know exactly who was behind the cheating were, in my opinion, the main reasons that the KGC was comfortable releasing his name. The other 31 names involve people who might have known about the cheating or helped enable the cheating. In many cases it is possible these individuals enabled the cheating without actual knowledge of the cheating itself.
My Personal Experience
I would like to take a minute to talk to all of you about my personal experience relating to the cheating scandal. As I’m sure all of you can imagine, it has been a complete roller coaster for me – and many of our staff.
The investigation and corresponding audits were complex and grueling. The investigation was the worst part because it was such a horrible fraud, where individuals stole tens of millions of dollars from customers and friends who trusted them. There are also many smaller personal horror stories from those that were affected by this fraud, many of which turned my stomach and I will never forget.
It has also been weird getting used to being very unpopular. Generally, I think I’m as likable/unlikable as the next guy, but I am the name and face of UB now and I understand that people have to focus their frustrations somewhere.
The most positive thing that I will take from this horrible situation is that our company successfully settled with the previous owners of UB for the amount of USD$15,000,000.00. With this money and a lot of Tokwiro’s own money, we were able to financially compensate players who lost money to the cheating accounts. I know a lot of people will never like our company and brand because of this unfortunate incident, which I respect their decision as I am sure I might have similar feelings if our roles were reversed. However, there are a lot of people who were refunded a lot of money, who know that we were not involved in the cheating and that UB is a safe place to play poker now. I know a lot of them are very appreciative of what we did and I think the individuals who work for UB should be proud of this accomplishment.
Thanks
I would like to thank all of our loyal customers and the entire poker community. I truly believe poker players are the most intelligent group of people around and I will leave 100% of the credit for exposing this fraud to you.
It’s been a pretty cool month for online poker. My highlights include a few challenges: Gus Hansen’s boxing match against Theo Jorgensen, Tom Dwan’s (aka “durrrr”) challenges the world to a $1.5million prop bet and Patrick Antonious accepted, and UB’s Steps Challenge.
I was pretty busy in 2008 and I did not make time for keeping myself in shape. This year I started boxing training, started back at the gym, and I am just trying to stay active as much as possible. I never liked going to the gym and it’s always been a constant struggle for me. I played ice hockey for most of my life and it was a great way to stay in shape, especially because I actually enjoyed playing. For the past four years, I’ve been living in places where ice hockey is not an option and staying in shape has not been easy. To be perfectly honest, I hate going to the gym, but thankfully I enjoy boxing which has become my new hockey. It’s something I want to keep getting better at, which motivates me to work hard and to keep going to training, whereas with the gym, I usually stop going after a while. But now, even going to the gym to lift weights has more appeal because it is helping me to become better at boxing (At least that’s what I keep telling myself).
I have always been a fan of boxing and recently I have also become a big fan of Mixed Martial Arts. So when I heard about two professional poker players (Gus Hansen and Theo Jorgensen) in a boxing match, I got pretty excited.
I think it was a great publicity stunt and a really fun bet between friends. I am just getting started with my boxing training but I can appreciate the hard work these two guys must have put in to prepare themselves for a 3 round exhibition fight.
The challenge: Hansen placed a handicap on himself in the match. Gus had to pay $35,000 if he lost and Jorgensen $25,000 if he lost.
In the first round I thought the fight was pretty even. Theo came out and landed a few in Gus’s face, which I think tilted Gus a little bit. Gus then came charging back at Theo for the rest of the round, landing a few really good right hands. The two exchanged a lot of punches and I think it was a very close round. However, I think Gus got too excited and was too eager to land a big right hand, which he was able to do a few times, but he also wasted a lot of energy in the process.
In the second round, I think it was a relatively even too, but Theo seemed a lot more calm and retained a lot more energy than Gus. In the third round, I think Theo pulled ahead by staying with his strategy and taking advantage of Gus’s fatigue. Theo continued to land solid jabs and right hands, while Gus came with solid punches when he had the energy.
I think it was a great amateur fight, even though to a lot of people it probably looked like two boys just throwing wild punches. Both fighters impressed me, but Theo was able to stick to a simple strategy of landing effective jabs and right hands without trying to land too many hooks or try anything fancy. He conserved his energy and stayed calm which enabled him to execute his game plan.
Thanks to both fighters for bringing some excitement to the poker world! And congrats to Theo on the victory and the $35K!
The Durrrr Challenge
Tom Dwan “durrrr” has made quite a name for himself in the poker world. At just 22, he has already become a legend through his success at the nosebleed cash games and tournaments.
Recently, Dwan issued the Million Dollar Challenge, open to any member of the poker community except Phil “OMGClayAiken” Galfond. The challenge requires opponents to play Dwan in 50,000 hands of $200/$400 or higher on four tables at a time. If either player drops below 75 big blinds in their stack at any point, they must reload.
At the conclusion of the Pot Limit Omaha or No Limit Hold’em hands, a winner will be crowned. If Dwan is ahead by $1 or more, his opponent must fork over $500,000. If Dwan’s opponent is ahead by $1 or more, he has offered to pay $1.5 million. In each case, the victor will also keep the spoils of the 50,000 hands of play. In addition to the money, the Million Dollar Challenge is about bragging rights.
So far Patrick Antonius, Phil Ivey, and David Benyamine have accepted the challenge.
Patrick Antonius was the first to accept and they are currently at just under 4000 hands and Dwan is currently leading by roughly $150K.
It seems that most people agree that Dwan has an advantage over the world’s top players when playing 4 tables. I’m wondering if it’s enough to justify the 3:1 odds against the best players in the world? Regardless, I think this challenge has created a huge amount of exposure for Dwan. This challenge and his appearance on some big poker televesion this year (including my fav show, GSN’s high stakes poker) , should make 2009 an even bigger year for Dwan than 2008.
We recently launched Steps on UltimateBet and we have come up with a promotion to celebrate it. The first 10 players who win all 10 steps (note: you have to start at the .10cent step to qualify) will win a WSOP package (value of $12,000) and an Aruba package (value of $8500)!
I believe this is the best value I have ever seen in a Steps promotion.
I’m thinking about issuing a challenge of my own this year. I’m considering challenging other online poker CEO’s to a boxing or golf proposition bet. If anyone has any ideas for the challenge, comment on this post.
So far I’ve only made serious posts on this blog about important topics. Today I wanted to try something different and just share some fun clips from the net.
My Favorite Obama Clip
This is a clip of Obama talking about his negotiating style. Gotta love Obama!
Here is a quick update on the recent software issues.
Please note that all players were refunded for these problems and the software has been fixed.
Tournament #2120428
A player IYKISA was playing a tournament on December 20th, 2008.
IYKISA’s chip count was reset twice during this tournament because of a software malfunction involving satellites.
First his chip count was reset from 2970 to 3000 when he won the first satellite (TID 2120487), gaining 30 tournament chips.
When he won the second satellite (TID 2120480) his chips were reset from 3720 to 3000, losing 720 tournament chips.
Both “resets” account for 690 tourney chips disappearing from the tables, meaning the winner standing up with 269,310 instead of the expected 270,000.
Ring Game’s #1162170993 and #1136089263
I also wanted to share the additional information I have regarding the malfunction with a hand involving Phil Hellmuth’s (#1162170993) on December 20th and another incorrect payout on December 2nd in Hand #1136089263.
I am still reviewing these investigations with our software department but it appears that the malfunction with hand #1162170993 occurred because of new software code released on December 10, 2008. In this software release, new functionality was added to our platform that removed players from heads up tables if they were inactive at the table for a lengthy amount of time. We believe that a problem with this new functionality was the cause of the malfunction.
Currently, my understanding of the incorrect payout involving hand #1136089263, is that the root cause of this issue related to the transferring of players from one of our game servers to another. At the time of this hand our software department transferred players to another game server while fixing a load issue, shortly after we launched the CEREUS platform.
We take these software issues extremely seriously and I will post more details about them soon.
On Saturday, December 20, 2008 we were alerted to a problem with a hand involving PHILHELLMUTH and DOUBLEBALLER.
We realize that this issue is of great concern to UB’ers and the poker community. Since we learned of the problem we have worked tirelessly investigating and fixing the software issue that was responsible for the incorrect payout. We have now released an official statement, which you can read it on our corporate site tokwiro.com.
I became aware of the problem on Saturday evening, shortly before I made my original post on this blog. I must admit that the information on twoplustwo was very helpful to me in getting up to speed right away.
I know many of you wanted information immediately after the incident happened. I did make a post on the UB blog to let everyone know we were aware of the problem and the seriousness of it. At the time I did not comment further because I wanted to make sure that we had all the facts before we made any public statements. I would hate to say something that is inaccurate or even false because I rushed it out before understanding the problem completely.
The problem is truly and honestly just a software malfunction. I do realize this issue caused a great deal of concern because Phil Hellmuth, a spokesperson for the site, benefited from the malfunction and that is quite the coincidence. For this reason we are providing the public with as much information as possible and hope that by doing so, and answering as many of your questions as possible, you will be reassured that our site is a safe place to play.
The Issue:
As we explained in our press release, the incorrect payout was caused by a software malfunction. The software malfunction occurred when the winning player was disconnected from the hand at the precise millisecond the software was determining whom to award the prize. This in conjunction with the “player’s state” data being cleared from memory caused this extremely improbable incident to occur.
Originally we were unable to reproduce the error in our test environment, until we programatically forced a disconnect to happen at the precise millisecond the hand was being awarded.
We have never had an issue like this reported previously and we have reviewed all of our database and application logs for December and November and have been unable to find any historical occurrences. We are continuing to go back further into the historical data to ensure no hands from the past need to be corrected. Analyzing this data takes time but we will continue to go back further and further into our history to ensure no one else was affected.
The second, related issue:
During the weekend we released an update to our game servers which included new business logic to prevent the first incident from ever happening again. The new update unfortunately created a new logic issue resulting in 36 hands with incorrect payouts. The 36 hands affected were lower limit razz, stud, and hold’em hands. Upon learning of this problem, we were able to addressed it quickly and the affected players were refunded immediately. We are extremely confident that everything has been corrected and order has been restored but we’re continuing to monitor the system and are performing extensive tests to ensure there are no incorrect payout or disconnect issues in the future.
An unrelated issue:
Another player made a comment on our blog (Mark) and emailed our support team about a tourney (2120428) where 700 chips were mysteriously deducted from his stack mid tourney. What happened was his chip stack was reset to his starting chip amount (3000 chips). This happened because he won a satellite into the very tourney he was already playing in . This uncovered the unrelated problem, where the system reset his chip stack to the starting amount. This software issue was addressed immediately and Mark’s account was refunded.
Our company takes a lot of pride in our work and i think it’s safe to say we are embarrassed by these issues. We have an amazing software development team who have accomplished so much this year. I assure you they take this very seriously and I’m confident they have dealt with these issues professionally and I do not expect anymore problems to occur.
Our company is committed to being the most transparent site on the net and to providing our players with a personal touch that other sites do not. I speak to many players myself, I grant a lot of interviews, we offer phone support and our security team speaks with players on a daily basis. We hope that you start to notice the improvements we are continually making to improve our service and transparency.
I will try to blog and respond to your comments/questions the best I can over the holidays.
Earlier today we learned about a poker hand where our system paid out the losing player instead of the correct winning hand. The hand number is #1162170993.
We are investigating this software malfunction as our absolute top priority.
This is the first incident of this kind we have encountered.
We are currently examining the poker system and the application logs in order to pinpoint the cause of this malfunction.
So, lately a LOT of people in the media have been asking me about CEREUS and my reaction to the 60 minutes segment. Instead of posting a long blog about it, I thought it would be easier to just provide a link to the podcast interview I did with the PocketFives poker forum this week.
Our technical staff are working around the clock to address the issues you are having with the new software update. I apologize for the delay in response to your e-mails, we have a surge of requests coming in and it will take a bit longer than usual for our staff to get through them all. I assure you that we are here, we are listening, and we are working to fix these problems.
Before contacting our support team, please see if the content below helps solve your issue:
Problem: Everytime I click ok to receive the update it does nothing and now I can’t get on to Ultimatebet.
Solution:
Close the Upgrade if it has crashed. This may require going into Task Manager (CTRL+ALT+DEL) and ending upgrade.exe process.
Go to Start > Program Files > Settings > Control Panel > Add Remove Programs (depending on OS).
Select any and all versions of Ultimate Bet and uninstall.
Go to the folder Program Files to check for Ultimate Bet folder. If folder is found delete it.
Go to www.ultimatebet.com
Download and Install the UB software again.
Problem: I can’t get in without verifying my email (missing validation code).
Solution:
Try logging in now. All UB accounts should no longer have issues with the validation process.
Question: I have to change my screenname? What’s up with that?
Answer:
The CEREUS poker network offers UltimateBet fans many new advantages, including an expanded pool of players, bigger Bad Beat Jackpots, more guarantees and a lot more action at the tables. As a result of the expanded player base, there is some duplication of player nicknames.
Duplicate nicknames can’t exist on the same network, as it would cause a lot of confusion and mistaken identity issues.
We apologize for any inconvenience this may have caused some of you, but keep in mind that picking a new username can work in your favor. If existing players recognize you at the tables and already know your playing style, your new name would make you appear brand new to them at the tables and they won’t know how to react to your moves. This is a significant advantage.
Once you login to your account, you will see a popup window asking you to change your nickname. To check the availability of the new nickname, click the button called “check ID.” Keep in mind that this change is a one-time deal, you will not be able to do it again, once your new nickname has been selected.
If you would like to keep a version of the username that you originally registered, simply add an additional letter, number or underscore. Special characters are not allowed. All nicknames will be in capital letters.
Please write down your new nickname, so if you forget it , you can easily look it up. Remember to keep your account password private, especially when other people may have access to your computer.
Problem: I am having a problem retrieving my password.
Solution:
Please try the Forgot Password process again located at the Login Window. We have made this process simpler and it should work now.
If you are unable to login after following these steps, please contact us at support@ultimatebet.com including the answer to your security question so we can provide further assistance.
Again, we will be working on addressing ALL your concerns around the clock. I know that some of you are unhappy with the changes we’ve made to the game interface. Change – any change – is usually met with resistance and it’s totally understandable. I urge you to give it another shot. I can assure you that the technical problems you are experiencing with the update are temporary. We will not let up until all these issues are resolved.
If you get past the superficial changes and think about the massive benefits this new network has to offer, I think you will fall in love with UB all over again. With so many more players online at one place, think of the massive jackpots, better tourneys, more guaranteed’s, bigger promotions. It’s huge!
I hope that you will stick with us through this time of change and I promise that we will do our absolute best to make sure that you have the most amazing online poker experience.
Roughly eight months ago our company was contacted by 60 Minutes. They were working together with the Washington Post to develop a story about online poker.
The show’s producers asked us a lot of questions off camera, and initially we provided them with a lot of information and tried to answer most of their questions. We soon learned that the story was to be only about our company and the cheating scandal that occurred on our site.
We continued to cooperate with them in hopes of getting the truth out about what really happened. We provided the Washington Post with on-the-record responses to over 150 questions. I personally gave an off-the-record interview with Gil Gaul from the Washington Post and met with Ira Rosen, a producer from 60 Minutes. I had numerous calls with them over those eight months and tried to answer their questions the best I could. Over the many months they were developing their story, I struggled with the decision as to whether to grant them with an on-camera interview. At first, I was very hesitant to grant the interview because this was by far the highest profile media I have ever dealt with in my life. But after talking at length with the two gentlemen, it became very obvious to me that they had no interest in telling a fair story. They were only interested in getting me on camera to try and make me and my company look bad. Basically, it came down to them wanting to produce a sexy story about the “dark underbelly” of online poker and embellish it with details of the cheating scandal. Knowing this, I decided not to grant the on-camera interview and instead just provide them with a written statement.
According to the CBS News website, the show that they have been developing for 8 months (man, our investigation didn’t take that long), will finally air this Sunday, November 30th.
Since taking over as COO at the beginning of this year, I have given many interviews and worked with the media, specifically about the cheating scandal. I have done interviews with www.twoplustwo.com, www.pocketfives.com, Cigar Aficionado, numerous poker blogs, many poker news sites, and dealt with a variety of high profile investigative journalists.
Every interviewer I worked with treated me fairly, asked tough questions, and gave our company a fair shake based on facts and not just people’s opinions. After dealing with 60 Minutes and the WP for many months, everything inside me was screaming they were going to try and crucify us. Although they assured me during certain times that I would be completely off the record, it later turned out that I wasn’t. They were very friendly towards me until I said I wasn’t sure I would agree to an on-camera interview. Just after the words left my mouth, they immediately became very hostile. They said that unless I granted the interview, they would do their best to make me and my company look horrible. At that moment, I realized that their goal was just that to begin with. There was little I could do to improve the spin they were going to take. I firmly decided to not grant an interview and was comfortable with my decision.
After viewing the two video clips on their website yesterday www.cbsnews.com/video/60minutes my worst fears seem to be coming true. By the looks of the first video, it seems that they will paint online poker as an illegal industry with no oversight. Then they will go on and make blatantly incorrect statements about our company and the incidents of cheating. The player whom they interviewed explained the cheating well, but everything else seemed either inaccurate or inflammatory. In the second video, which is an interview with Kroft, it seems that he is reading cards and hardly knows the details of what happened. Unfortunately, I think the story will not be fair to our company and will not add anything to what everyone already knows in the poker industry.
What would you guys have done if you were in my position? Would you have granted the interview or not? I am very interested to hear your thoughts.
Anyways, let me know what you think…If we had agreed to go on camera, here are some points that I would have wanted to get across:
• Our business is not illegal. Joseph Norton has the aboriginal right to operate a gaming business, as a Mohawk of Kahnawake, and he provides online poker services to players from around the world.
• AbsolutePoker’s and UltimateBet’s cheating scandals were awful and we will never forget them. But we have put a tremendous amount of effort into refunding all affected players, being transparent, and ensuring this can never happen again.
• Our company never benefited from cheating. In fact, it was damaged severely by the scandals as players lost trust in us, while the media condemned us.
• However horrible this incident was, I believe that we are a better company because of it.
• In the AbsolutePoker scandal, false statements were released by the company, but once upper management discovered what happened we immediately took decisive and corrective action to ensure the problems were addressed completely.
• In the UltimateBet scandal, we inherited the cheating from the previous ownership. We fought for the better part of a year to investigate and understand everything that happened. We won a settlement from the previous owners in court and quickly completed all of the outstanding refunds, although the total damage to us was far in excess to the amount we settled for.
• Our company has been transformed in 2008. Security, transparency and compliance with the strictest regulations and standards are our priority. I believe that we are now the most open, approachable and personable poker business on the net.
Regardless of how the 60 Minutes producers choose to skew their show, I know that we have acted with diligence and transparency in addressing these crises, and we will continue to do so. We have told the story of how the cheating occurred in an open and honest way.
I also know that for me, Monday morning means I’ll breathe a little easier. At least then we’ll know exactly what punches the 60 Minutes program has thrown at us, and in the bright light of day, I believe we’ll be well equipped to counter the attack.
