60 MINUTES STORY – Did I make the right decision?

Thursday, November 27, 2008 - COO

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.

You can view an interview with me on youtube or on our corporate website www.tokwiro.com.

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.

Tags: 60 minutes, cheating, COO, Corporate, scandal

Comments (12)

Rebuilding a brand

Thursday, November 20, 2008 - COO

Paul Leggett

Two cheating scandals, refunds, settlements, audits, negative press, more refunds, and more audits… It has been one hell of a year.

When I first learned of the cheating scandal on UltimateBet ten months ago, I felt sick to my stomach.  As the investigation continued, the situation started seeming more and more impossible. To be honest, at times I wondered if I really wanted to be the COO of a company that was likely to implode. But the more I thought about it, the more I realized how important it was to see this through. Here are hundreds of poker players who have been cheated out of millions of dollars. And here is a company full of amazing honest people, who are forced to take on a burden left behind by someone else. So I thought, you know what… no. There is no way I’m walking away from this. My co-workers and I gathered together and decided to take on this responsibility as a team. We decided to fight this thing, to clear our company’s name, and most importantly, to give our players back the money that was rightfully theirs. Making that happen was definitely worth the challenge.

On November 3rd, 2008 we settled with the previous owners for $15 million dollars. By November 5th, we awarded all the remaining refunds to players who were victim to the cheating on UltimateBet. Since then, I have personally spoken with a lot of the players who received their money back.  As you might imagine, the list of players included some of the biggest names in the poker industry.  Our company feels that we’ve done nothing more than get these players their money back, which is really the only honorable thing we could do. But I have to say, it was an amazing feeling when poker players from around the world not only thanked us, but openly endorsed us. In fact, a lot of them have even come back to play on the site after years of inactivity. By far the most important thing to me is the trust that we have regained in the community. Having been awarded the settlement from the previous owners, people are finally realizing that our company had nothing to do with the cheating scandal. We fought hard to bring the guilty parties to justice and give the money back to our players. I hope that these refunds will help restore any faith that may have been lost in online poker as a whole.

Now as we are getting closer and closer to putting this thing behind us, it’s time to focus on rebuilding our brands with security and fair play as the foundation. Although this cheating scandal was a nightmare, I think that it has made us more obsessed with security than we could possibly imagine on our sites. Our philosophy is simple… the more layers of security the better. We’ve greatly enhanced the methods for securing real-time hole cards, access to production code, and connection to our servers.
We organized a team of security experts who have developed our new security center application that automates the detection of abnormal winning statistics.

The security center has also been improved to include the detection of multiple accounts and we’re working on advanced features for the detection of
•    sharing of accounts
•    bots
•    collusion
•    money laundering
•    chip dumping

We also plan to work with independent third parties that could potentially provide us with full auditing services, whereby they would audit all hand histories on our sites. We also want to give our players the option of turning to a third party authority if they do not feel we have fully resolved their issue or complaint. We are happy with the direction we are heading in and with a few intelligent promotions and marketing campaigns, who knows where we’ll be.

All in all, it’s a pretty exciting time. We have more high stakes action on UB now than we have in recent history and we’re quickly working on initiatives that should increase the high stakes action even more. We look forward to merging AbsolutePoker and UltimateBet onto one unified poker platform very soon, which will make us one of the largest poker communities online today.

It’s been a hard ten months, but I am ecstatic that our players have been refunded and that our employees can hold their heads up high again and be proud of their work.

P.S. I quit smoking when we did the refunds…anyone want to make a prop bet on how long I’ll last?

Tags: cheating, COO, scandal

Comments (7)