On a day when the world’s eyes will likely be focused on Day 3 of $50k HORSE USA vs. Brazil, 60 minutes is rerunning their story on the biggest scandal to hit online poker.

Curious timing. It could just be a throwaway piece of filler, or it could be given an introductory time-hook connecting it to the kickoff of the WSOP. (The non-poker world that hasn’t been following us for the past month thinks the World Series starts next week.) Or … might the replay have been pushed in connection with National Poker Week and the supposedly soon-to-be-heard Barney Frank bill?

ADDENDUM: Yep, pushed back to September.

If that’s the case, you gotta wonder which side pushed for that — the side that contends prohibition is necessary because online poker is a crooked, degenerate pursuit, or the side trumpeting regulation in part because of the assistance needed to keep the game clean.

The Hollywood Reporter is, well, reporting from Hollywood that Leonardo DiCaprio is pegged to star in a film about online casinos based in Costa Rica. Not only does the star currently aligned with the film give us hope that it won’t be another Deal, but the writers - Brian Koppelman and David Levien - are the same ones who penned Rounders. And Paramount Pictures has picked up the script. (Note to self: Check in with former employer Paramount for possible consultant positions available. Cha-ching!)

Hmmm, Costa Rican-based online casinos…like UltimateBet and Absolute Poker? Scandals and cheaters and Russ Hamiltons, oh my.

Since the movie is yet untitled, let’s throw out a few gems for Paramount to consider:

Titanic (ooooh, sorry)
UB and Me
Rounders 2 (or Part Deux for my French friends)
Rounderaments
What’s Eating Russ Hamilton?
Gangs of Costa Rica
The 11th Hand

Okay, I’m done. Anyone else?

I had been hearing murmurs … and now we get the word from @LaceyJones herself that the hostess of tomorrow night’s WSOP launch party is back with her former backers at Absolute Poker.

Though I haven’t had a chance to ask her about it yet, it’s a curious move … considering she was a disgruntled former face-person for AP with plenty of reasons to believe they may have been a shady operation even before the cheating scandal emerged. (It was the bogus charity popcorn sale at the 2006 WSOP, I think, that really chapped her hide.)

While I suppose it’s theoretically possible that Lacey is such a degenerate poker addict that returning to her former abusers was the only way to get her tournament fix, might it more so suggest that one of the purest poker hotties has re-evaluated the company and concluded that the new-and-improved operations at Absolute are clean and dandy?

The 200 companies that are to supposed to be blocked by 11 ISPs to Minnesota residents has now been published by IMEGA, which can be found here on their site . The list of 200 companies is an eclectic list of sites, because it was chosen randomly. While sites like Bodog and Full Tilt Poker are on the list, there are a few notable omissions: Absolute Poker, PokerStars, and Ultimate Bet. The list also contains sites that don’t take US customers (BetFred, Everest Poker, Interops, William Hill, among others).

In previous years, the World Series of Poker would hold a Gaming Life Expo during the first four days of their main event. In the good old days (pre-UIGEA) numerous online poker sites would pay to have their own suites where you could stare at their stars, have a pillow fight with strippers models, etc. Nowadays, the GLE has been a scaled down affair where companies try to sell their various poker related products like books, bobble heads, training sites, poker associations, and many other products.

This year, they’ve retooled their GLE into what they’re calling Poker-Palooza. From their website:

More…

A Judge in Washington State has made a ruling in the Betcha.com online gambling case involving our old friend, Nick Jenkins! Plus, we cover industry news from the United Kingdom about Google’s online gambling advertising policy, and the Toronto Sun article about which finally covers the Absolute Poker cheating scandal.

The new episode is a pretty good one … Joe, Gavin, Shronk (via robot voice), a hot girl, and the other guy Ali Nejad haven’t even gotten to the Annie Duke interview that I clicked over to listen to yet … but they’ve kept me thoroughly infotained talking about the Bellagio 5-Diamond blind structure, November Nine TV appearances, and a few poker hands.

Good stuff. Goes well with FoxNews in the background: PokerRoad Radio, with Annie Duke

UPDATE: OK, I listened … and though I’m not sure I cared to know so many details about Annie Duke-Joe Reitman sex, she does answer some questions revealing why she didn’t participate with 60 Minutes (her claims of their falsehoods to lure her into the story seem totally believable to me — media people do say these things — though I do wonder could they have gone with a more regulation-oriented storyline had she or Paul Legget gone on camera), why she is indeed so confident about AP/UB/Cereus’ commitment to running an honorable business, why she remains a loyal face for the brand (it’s not the money), and how she wants to see Russ Hamilton burn in non-Atheist hell.

She also dances around questions about her rumored appearance on the upcoming season of The Apprentice in a way that semi-confirms she has intimate knowledge of a show beginning in March with a finale in May.

Pokerati’s own Dan Michalski will be on Wise Hand Poker shortly (5:45pm PT?) to discuss the 60 Minutes/Washington Post pieces on the Absolute Poker and Ultimate Bet incidents. To listen live head to www.roundersradio.com.

Tokwiro Enterprises announced that it has chosen to follow the Kentucky court order and block Kentucky residents from accessing Absolute Poker and UltimateBet. In an explanation, COO Paul Leggett said, in so many words, that the purpose it to protect the domain names for the entirety of its customer base.

Being anxious about following the letter of the law when trying to rebuild a reputation is one thing, but could this be jumping the gun a little? The case is currently on hold due to the appeal process, and the deadline for blocking Kentucky residents has been postponed until the appeals court hears the petition, which is scheduled for December 12th. Today is December 2nd. Just sayin’.

The entire press release from Tokwiro is as follows:

TOKWIRO BLOCKS ACCESS BY KENTUCKY RESIDENTS
TO ITS ONLINE POKER SITES

Customers Connecting from IP Addresses in Kentucky Will Be Unable to Play on Absolute Poker and UltimateBet Sites

MONTREAL, CANADA (DECEMBER 2, 2008) — Tokwiro Enterprises ENRG (Tokwiro), the owner of the Absolute Poker (AP) and UltimateBet (UB) poker sites, announced today that, in order to fully comply with the Franklin County (Kentucky) Circuit Court’s recent orders, it is restricting access to Tokwiro’s sites by Kentucky residents.

More…

They report, you decide:

Watch CBS Videos Online

As has been discussed earlier, Mike Sexton, Greg Raymer and Linda Johnson were also interviewed for the story. In this web exclusive, Steve Kroft discusses tells with them, which seems silly to talk about in reference to online poker.

Watch CBS Videos Online

OK, I just read Part 1 of the Washington Post story by Gilbert Gaul on cheating at Absolute Poker and Ultimate Bet. I thought it was great and on target and technically correct to the letter when discussing legal matters. I learned a bunch of stuff I didn’t know, too.

Two-and-a-half specific things caught my eye:

(The name of the alleged cheater has circulated widely among poker players on the Internet. The Post is not publishing his name because, even though he purportedly confessed to AbsolutePoker, the company did not release its records and would not discuss the matter. The alleged cheater declined requests to be interviewed.)

Maybe I just haven’t been following it close enough on the forums, but I’m wondering whom they’re referring to here.

The story also doesn’t reference the new formation of Cereus, after acknowledging that UB would likely lose its license and be out of business soon. Hmmm. But that’s really new, and this story was possibly put to bed a few weeks ago?

The other thing is the last graf:

The Kahnawake now say they operate one of the most secure Internet gambling operations in the world. Tokwiro says it has “established cutting-edge security systems that make us the safest site in the industry.” But Catania said he does not expect cheating to stop: “I’m sure there are people out there right now figuring out, let’s say, ‘Here’s a way we can do it again.’

Yikes, that last sentence leaves it open-ended as to how part two of the story will fall when it comes to legalization efforts.

I really like poker’s chances (because I sincerely believe despite our internal battles with shadiness, our industry is on the right side of legal issues here) … and from what I’ve learned in my rookie dabblings in poker (and strip-club) politics, the treatment this story is getting in Washington DC — a big investigative feature spread out over two days with lots of informative sidebars — now guarantees (I’m like 86 percent sure) that our issue is on the 2009 political agenda. I’m not totally comfortable yet, of course. Current feeling in my gut is comparable to waiting for the river when all-in against an 8- or 9-outer. A little unsettling. But hey, that’s what we came here for, right?

In addition to the story itself, the WP’s got a bunch of goodies for those who want to dig deeper, or just check their work:

• Here’s a timeline titled “Internet Poker and the Law” — they get the UIGEA, imo.
• Paul Leggett’s defense (pdf)
• Video explaining Texas Hold’em — as in how to play … they clearly see poker as a fun skill game, not a dangerously addictive vice; if the investigation were about shady drug runners, after all, you wouldn’t see a similar vid on how to make good meth.

• Also: a video about David Paredes going from intelligent amateur to uber-skilled pro.
• A timeline about how the AP/UB/Cereus cheats got caught.
• And another timeline of the scandal, complete with cool Web 2.5-ish document pop-ups.
• “Reporter’s notebook” about The Mohawk Connection.
• And shoot, wish I had seen this one before linking to the above — an everything page chronicling the entire investigation, complete with fun little numbers about (taxable) online poker revenues.

So there you have it. It would hard to expect anything more thorough. Kudos to “special correspondent Gary Wise“, too, for playing poker-biz fixer for the WP investigative team turning over rocks.

Part 1 of the WaPo investigative report

They’re running the story over 2 days, Sunday covers the AP/UB situation. Monday asks the question: Should Internet Gambling Be Legal?

The Reporters Notebook by Gilbert M. Gaul helps answer the question as to how the Kahnawake Nation became a leader in online gambling.

Dan Druff over at Neverwin breaks down the Paul Leggett memo in a way that might make some think the AP/UB scandal is still going on, or at least a cover-up is:

* Tokwiro agreed not to prosecute the perpetrator in the Absolute Poker cheating, and to protect that individual’s identity, because this was the only way to ensure that the ability to cheat was fully discovered and disabled. Because of this decision, AP could continue operating and begin to reimburse affected players as quickly as possible.

Pretty sweet deal for the guy, huh? Wouldn’t you like to work for a company that will agree not to prosecute you for stealing millions from them, provided that you just show them how you did it, if caught? There is zero chance that this is true. It would have been easy for them to deconstruct this after-the-fact without this asshole’s help. Obviously they are protecting him either due to continued association/affiliation (likely), fear that he will spill the beans on everyone and everything else there (also likely), or both (most likely).

Must-read for anyone who wants to understand what all the hubbub is about.

While most of the poker community will anxiously be awaiting the 60 Minutes piece on the Absolute Poker/Ultimate Bet incidents at around 7pm ET Sunday; the Washington Post, who were investigating the story along with CBS News, will have their own story available in their Sunday edition. Their piece, which will also be found on their website, may be a better indicator as to how the 60 Minutes story will be covered later that night. Also, it’s figured that the Washington Post won’t be as limited in trying to tell the complete story, since 60 Minutes has to try and explain the situation along with discussing the legality of online gambling in a 12-15 minute piece. . There will also be an online chat on Monday with WaPo investigative reporter Gilbert M. Gaul and Serge Ravitch, an online player who was also involved in the investigation.

Nat Arem sure has sources. He recently received a forward of an inter-company memo from Tokwiro Enterprises COO Paul Leggett regarding the upcoming 60 Minutes story. Leggett has reason to believe that there will be a bias against Tokwiro and its companies, going further to say that online poker will emerge with a bad reputation. Thus, they did not appear on camera for interviews. (A little like saying that the jury has a bias, the judge is going to declare me guilty, so why defend myself?)

Leggett wrote:

“We have every reason to believe that the 60 Minutes producers are intent on portraying the online poker industry and our companies in a negative light, and we do not expect that the program will be either fair or balanced.

Because of 60 Minutes’ apparent bias against Tokwiro and online poker, we have decided not to appear on camera. We have, however, had many conversations with the program’s producers. We provided them with extensive background materials and documents, and we answered questions on-the-record, but off-camera. Despite all this, it is not likely that our views will be properly represented. Therefore, it is important that all of our staff know the following facts about our company:”

The remainder of the memo states some facts about Tokwiro Enterprises and the cheating scandals, most of which were released to the public in UltimateBet, Absolute Poker, or Kahnawake Gaming Commission press releases or statements.

The tone of the memo and words chosen by Leggett indicate that the 60 Minutes piece could portray online poker in a bad light. In fact, what Leggett fears is that Tokwiro and its online poker entities will look bad. Well, that is entirely possible because the way in which the scandals were handled was bad, and if that comes out in the reporting, who is really at fault, especially when the company in question refuses to go on camera with a statement and show otherwise? And in truth, what is said about AP, UB, and Tokwiro really doesn’t reflect on the entire online poker world, and there still remains some hope that the reporters for 60 Minutes and the Washington Post will make that clear distinction.

The day that UB and AP finally merge to create the Cereus Poker Network, comes this from the 60 Minutes section of CBSnews.com:

THE CHEATERS - 60 MINUTES and The Washington Post reveal how online poker players suspecting cheating were forced to successfully ferret out the cheaters themselves. That’s because managers of the mostly-unregulated $18 billion Internet gambling industry failed to respond to their complaints. Steve Kroft and The Washington Post’s Gilbert Gaul report. Ira Rosen is the producer.

It’ll be the first story on this coming Sunday’s 60 Minutes broadcast, and should be available online by Monday morning.

Reminded via a Tiffany Michelle MySpace status update — “Excited about the Cereus launch this week!”:

The player pools, tables, tourneys, etc. from Absolute Poker and Ultimate Bet magically merge today.

Trying to keep an open mind … because theoretically it is possible that the combination of two sites caught in the biggest cheating scandals in the nascent history of the online poker industry — having learned painful lessons firsthand — could become a paragon of integrity and security, a model for fully legal American online poker in the future.

But I just can’t help to think back to the Dallas underground … when a saturated market had rooms and games beginning to merge, two shady operators joining forces seldom led to anything good (save for some pretty juicy opening-weekend tourneys).

That’s my bias, I suppose … but with that in the back of my mind, I can’t help but think of how one of these sites seemed rotten at the core (with the exception of Mark Seif, I’ve yet to hear any former employee say anything good about Absolute), and the other … well, sure, they’ve changed management and have plenty of good peeps working for them (Annie Duke, Phil Hellmuth, Mean Gene, et al.) … but the top of the pyramid hasn’t really changed as far as we can tell. And with all due respect to those who are just trying to throw good poker times … the mysterious, closely-guarded nature of Tokwiro+Kahnawake+UB+Chief Joe operating on the protected lands of the Mohawk Nation (with offices in Costa Rica) … that’s the definition of shady! Sorry, it just is.

Still, with $22 million in refunds, the action’s gotta be good.

Of particular interest to me in this series of Tokwiro-sponsored videos was Leggett’s confirmation that no one was or will be legally prosecuted in the Absolute Poker scandal.

When the perpetrator was discovered in the AP insider cheating scandal, he was given protection from prosecution in exchange for information about the crime. If he told Tokwiro exactly how he got the hole card information, his name would not be released to the public and no legal action would be pursued. Leggett said that the Kahnawake Gaming Commission still reserves the right to prosecute if they so choose, but Tokwiro will not.

Leggett noted that the $800K that was stolen during the crime was still in the cheater’s online account and thus confiscated by Tokwiro to repay customers. However, Tokwiro had to pay an additional $800K out-of-pocket in interest to those customers. I guess the perpetrator’s inside info was worth nearly a million bucks…

Also interesting was the specific mention of Scott Tom in order to clear his name. Leggett said that he was only implicated because his IP address was used by the cheater. Really? So, does this make AJ Green a.k.a. AJ Grimard the one and only perpetrator, as no effort was made to clear him? And I suppose the lessons learned in the AP scandal better prepared Tokwiro to identify the problems in the UB scandal, not needing any information from Russ Hamilton and allowing prosecution in that case.

This is discussed in the video below (Part 2, Section 2) and starts at the beginning:

It’s not quite 60 Minutes … in fact, it’s closer to 73 minutes. Absolute Poker/Ultimate Bet honcho Paul Leggett speaks with the CBC’s (Canadian Broadcast Company) Susan Reisler for an extremely detailed and stoic Q&A. I can tell you I’m very suspicious. This looks like an infomercial to me. (The apparent title of the show is simply “Poker” — I wasn’t aware of that investigative journalism news program.) Though she gets into all the controversial issues — and even the inbred nature of AP/UB/Tokwiro/Norton/Kahnawake — there’s no follow-up to anything that might sound peculiar (like the inbred nature of AP/UB/Tokwiro/Norton/Kahnawake) … she just allows him to state the facts and timelines, as if he were giving a legal deposition under questioning from his own attorney.

CONFIRMED: This is indeed a production by Tokwiro Enterprises, aka AP/UB. Anyone wanna wager on how many attorneys were standing off-camera to keep all commentary in legal line?

Sorry if I sound cynical. Really, it’s an admirable effort from Paul Leggett, the guy Annie Duke stands so strongly behind. Via the mock news program format, he addresses just about any question any of us have had about the whole Black Sox of Poker sitch. Kudos to you, Mr. Leggett, seriously, and thanks for finally coming forward with so much candid info. Personally, I’m starting to see your point of view on all this … and there were only a few questions where your answers made me wonder why Ms. Reisler didn’t follow up with: “But don’t you think that sounds fucked up?”

Click here for the entire 9-part library … bonus points if you can find the point where Leggett says “We were the victim here.”

Also check out the vid below, where Annie Duke speaks her mind on why she’s so loyal and has so much faith in AP/UB security … right down to algorithms and dealing with bots … and be sure to watch 4 minutes and 10 seconds in, where Reisler does her 60 Minutes style wrap-up: Everything is safe and secure, and Russell Hamilton is the Ultimate Bad Guy — he’s not part of Tokwiro and is in really big trouble if they can ever get their hands on him.

[Cue neoclassical new-age healing music.]

NOTE: KafkaCR? That’s the new YouTube video uploader’s name … OK, the CR is for Costa Rica … but Kafka? The Jewish-Bohemian novelist who, according to Wikipedia, wrote about “troubled individuals in a nightmarishly impersonal and bureaucratic world”?

Oh, wait … I get it … Metamorphisis! Very clever project name, whether intentional or not.

CBS has posted their sked for this weekend — and while adjusting story line-ups is standard operating procedure for any real journalistic operation, that rumored Oct. 26 date isn’t so. What is on the agenda for this next Sunday [from CBSNews.com]:

Sunday, Oct. 26, 2008
CREDIT DEFAULT SWAPS - Steve Kroft examines the complicated financial instruments known as credit default swaps and the central role they are playing in the unfolding economic crisis. L. Franklin Devine is the producer.

T. BOONE PICKENS - The oil and gas maven is on a mission to lessen America’s dependence on foreign oil. Charlie Rose reports. Michael Radutzky and Tanya Simon are the producers.

GORONGOSA - American Greg Carr is using his great wealth to try to help some of the poorest people in Africa by attracting more tourists to their neighborhood - the beautiful national park of Gorongosa in Mozambique. Scott Pelley reports. Rebecca Peterson and Henry Schuster are the producers.

And a few minutes with Andy Rooney …

My personal guess is that they will time it with the final table of the main event … either the weekend immediately before or immediately after.

UPDATE: More good info on what 60 Minutes has in store on the NWP Radio podcast (about 45 min in).

For those that have forgotten, an article today on msnbc.com brings up the scandal yet again. Mike Brunker ties in a $80m (Canadian) claim against the former owner of UB –Excapsa Software Inc. of Toronto by Blast-Off Ltd. of Malta (the current UB owner).

It goes over the details of the two scandals, including mentions of NioNio, Russ Hamilton’s alleged involvement, 2+2 posters help in breaking the scandal, among other items, definitely worth reading.

Jen, you know more about Absolute than I do, so maybe you already know … but I wasn’t aware that Scott Tom’s dad (what’s his first name? he won a 2008 bracelet, I know that much) may or may not be under indictment.

Am also curious why any indictment in this case would be sealed.

As noted in the original post, I recently interviewed Tokwiro Enterprises Chief Operating Officer Paul Leggett about a number of issues the recent UltimateBet and Absolute Poker scandals.

The interview transcript has been broken up into three parts and posted on PokerWorks. Part 1 focuses on Tokwiro’s purchase of AP and UB, and how any inkling of impropriety could be missed in the due diligence phase.

Part 2 delves deeper into the investigations – the internal UB one concluded by Tokwiro itself, the ongoing UB investigation by Gaming Associates, and the “surprise” assignment of Frank Catania to audit Tokwiro as a company. Leggett also discusses the reasons for the reimbursement process lag time, whether or not Russ Hamilton was involved in the cheating, and the roles of Phil Hellmuth and Annie Duke in it all.

In Part 3 I gave Leggett a chance to discuss what has been done at UB to rectify the problem and improve security going forward, and why customers should have confidence in UB and AP.

I feel that Leggett was as forthcoming as he was allowed to be, considering the restrictions inherent in the pursuit of legal action. He helped dispel some myths and rumors, though his inability to discuss Hamilton’s alleged involvement or any evidence in the case keeps interested parties in limbo for awhile longer. However, he helped put somewhat of a timeline on information he hopes will be released to the public, and he provided some details about how Tokwiro has tried to overcome the scandals, close security gaps, and regain the trust of the poker public.

Some might say that I’ve been a raving lunatic somewhat vocal about my frustrations with the AP and UB scandals. This is true, and thus I attempted to contact UltimateBet once again in July for answers to some of my questions. To my surprise, I was contacted by the Vice President of PR at Tokwiro Enterprises, UB’s parent company, who said she would respond to my inquiries. After two weeks of no such thing, I was on the verge of writing another rant/post here sending a polite follow-up when I received an e-mail asking if I’d like to speak with the Chief Operating Officer of Tokwiro, Paul Leggett. Ummm, yes, please.

I conducted the interview on Friday, Aug. 8, via telephone, and I must say that I was pleasantly surprised at Mr. Leggett’s willingness to answer my questions as he was able and be as honest as the corporate attorneys would allow. He has been reaching out to other media outlets lately, having done guest appearances on 2+2 and Pocket 5 podcasts, and I was happy to finally have a door opened and someone coming out to answer questions.

The full interview has been submitted to PokerWorks in a three-part series due to the length of the transcribed interview. The first article is up now, and the others will be posted in subsequent days.

Highlights of the interview included dispelling myths and rumors, speaking of the utmost confidence that the perpetrator(s) will be caught and prosecuted, and giving details about new security procedures and systems to prevent future improprieties.

A few excerpts:

In response to a question about how two companies, AP and UB, could be purchased without any knowledge of cheating going on at the highest levels:

“There definitely was due diligence done at the time of purchase… but this is a very large platform that we purchased. Unfortunately, during this due diligence process, we simply did not discover the code that was put on there…”

More…

The readers have spoken … and 42 percent of you are so damn principled that you wouldn’t even consider accepting tournament buy-ins from Ultimate Bet or Absolute, while 22 percent have a more mercenary attitude and/or have forgiven UB/AP. 18 percent of us aren’t sure, 12 percent have become so cynical that what’s the point of trying to lead a good life, and 6 percent are saying random shit that makes them kinda unclassifiable. So there you have it.

There’s a new poll up (on the right) where I’m curious … with our current knowledge of the poker world, business developments, main-event final-table hype in action, the state of poker on TV, political wildcards, and, of course, intangibles … how big do you expect the main event in the 2009 WSOP to be?

With all the attention on the UB/Absolute scandal today, I thought I’d offer some perspective on non-poker scandals. And since poker is a “sport” …

Sports Illustrated/CNN have compiled a photo gallery representing the 13 biggest “Gambling Scandals in Sports.” (No, UB and Absolute didn’t make the list.)

The scandals date from the Black Sox of 1919 (when the Chicago White Sox famously threw the World Series) to the NBA referee (Tim Donaghy) who pleaded guilty to accepting money from a gambler. Basketball was the most offending sport, with six of the 13 spots on the list (46%). Boston College has the dubious honor of being listed twice (for basketball in the late ’70s and football in the mid ’90s).

The last item on the list (which appears to be in no particular order) is about former NHL player Rick Tocchet, who has played in a major poker tournament or two.

Check out the full list here. (Keep in mind that this list only includes gambling scandals, and not cheating scandals in general.)

I find it interesting that while individual players must live with the consequences for decades (Pete Rose, Shoeless Joe Jackson, etc.), the organizations that allowed such cheating to take place usually pay only a short-term penalty before returning to full respectability.

It’s not a perfect parallel to the UB/Absolute scandal, but I think it’s relevant. It’s possible that after a few years, this scandal may be nothing more than a footnote to those two companies. What do you think?

If you find sports scandals boring, you can always check out SI’s second-most popular gallery (at the moment): “The Best 1980s Swimsuits,” with a vintage Christie Brinkley SI cover in the leadoff spot. In middle school, I claimed that my initials stood for “Billy Joel,” and he was my uncle. He married Christie later that year, and my popularity soared. Wait … swimsuit photos? Am I blogging for Pokerati or Wicked Chops?

Justin Shronk is also disappointed in Tiffany Michelle’s decision to sign with UB, and he made no bones about his feelings in an open, thoughtful letter to her on the PokerRoad website. In his Pokerazzi column dated today, he notes that he wants the best for his friend but believes this sponsorship deal is not it, and he hopes she goes the way of Eric “Rizen” Lynch and detaches herself from the UB brand.

Shronk’s letter in full is reprinted here:

BACKGROUND: I worked with Tiffany Michelle as Multimedia Manager for PokerNews from February to October of ‘07. Tiffany was our first on-camera hostess at the LAPC in February ‘07 and we worked together everyday at the ‘07 WSOP. I still consider her a good friend and respected colleague.

Tiff,

As is everyone that knows you, I’m really proud of what you did in the recent WSOP Main Event – and not just for placing 17th, someone does that every year. I took genuine joy in watching the poise with which you handled yourself every single day of the tournament. Maybe it was the lack of testosterone, or maybe it was your experience in front of cameras and crowds, but it’s not often you see a first-timer displaying more class than a lot of the players who’ve been there before.

That being said, as proud and happy as I’ve been for you, I’ve been equally disappointed with some of your choices – namely your association with Ultimate Bet. At this point, no one needs the details of the cheating scandal spelled out, and you probably know more about it than I do. This letter isn’t meant as an indictment of Ultimate Bet as a company – for that you can read the news releases or forums. Ultimate Bet is presumably now as clean as any other site, but it’s the past behavior of their owners that makes your decision such a terrible one. The current owners of Ultimate Bet are accused of dishonest and borderline criminal activity – and by representing the site you’re helping these same people make money.

More…

I really don’t know where I stand on this — especially without knowing the backing details and long-term intangibles — nor whether or not it’s even my position to have a stance when I think just about everyone is stupid, lame, and corrupt for working for The Man!. So I have put it to the readers … new unscientific poll on the right, asking how you would handle a potential business relationship with and de facto endorsement of an ethically challenged poker enterprise.

Oooooh, somebody might be in trooooouble! Or this could be a necessary step to ensure that the CEREUS network will have no problems. Either way, the situation is getting dicier.

Less than a week after the Kahnawake Gaming Commission finally stepped into the UltimateBet fray and noted that it’s hoping to have a final decision released in the coming days, the KGC has released another statement. This one is interesting in that it details the beginning of a new and separate investigation, this one into Tokwiro Enterprises, the parent company of UltimateBet and Absolute Poker. The most noteworthy aspect of this situation is that Tokwiro Enterprises is owned by Joe Norton, former Grand Chief of Kahnawake. Yep. Take that and put in in your pocket.

The details of the independent investigation being launched is in the full copy of the statement below:

Mohawk Territory of Kahnawa:ke
July 27, 2008

KAHNAWA:KE GAMING COMMISSION APPOINTS INDEPENDENT MONITORING-INVESTIGATION TEAM
Effective immediately, the Kahnawa:ke Gaming Commission (KGC) has appointed an independent monitor, led by former New Jersey State Gaming Regulator, Frank Catania, to investigate the KGC Licensee, Tokwiro Ent., parent company of both Absolute Poker and Ultimate Bet.

Mr. Catania is a former Director of the New Jersey Division of Gaming Enforcement (DGE), the regulatory and enforcement agency responsible for maintaining integrity and trust in all Atlantic City gaming operations. As division director, he was a driving force in updating the New Jersey Casino Control Act by fine tuning the balance between regulatory necessity and economic stewardship. After leaving the DGE, he served as the vice president in charge of compliance for Players International, Inc. where he was instrumental in resolving compliance issues the company had encountered in the State of Louisiana, prior to his appointment. He is a principal in Catania Gaming Consultants and the Law Offices of Catania & Associates LLC

The Independent Monitoring Team will be given the task of completing a full forensic audit/investigation of the online gaming business of both licensed entities. The main purpose of the investigation is to ensure that the games offered to the public are fair and honest and that all player protections as required by the Kahnawa:ke Gaming Regulations are being complied with, without exception. The monitoring team will also be charged with verification that all those involved in the fraudulent activities in any manner, no matter how slight, have been or are removed from the licensee company and verify that Ultimate Bet and Absolute Poker have submitted to full compliance with the directives issued by the KGC and recommended by the independent monitor.

Furthermore, Mr. Catania’s team will be empowered by the KGC to have full access to interview all employees, past or present, review all records, contact and interview all sub contractors and individuals whom the monitoring team believes necessary. Any failure by the licensees could result in immediate revocation of their license privileges with the KGC. In the event that any criminal activity is found to have occurred, such activity will be reported to the appropriate authorities for possible prosecution.

KGC License Holder, Tokwiro Enterprises has agreed to comply fully and submit to this independent monitor.

KGC Chairman, Dean Montour adds, “While the ongoing investigative process has dominated the attention of the KGC in recent months, we are fully confident in the ability of the Independent Monitoring Team to deliver results and assist the Commission in bringing this matter to a decisive conclusion.”

As per the terms of the monitoring agreement, and at the conclusion of the process, the KGC will review the report of the monitoring team and enter the results into their final considerations at the time of ruling in the Ultimate Bet and Absolute Poker investigations.

Murray Marshall
Senior Advisor
Kahnawa:ke Gaming Commission

Ah, it reminds me of the good-ole-days of the Dallas underground … when a bunch of rooms got ruffled every so often you’d see the merger of a few “bad guys’” games and would be kinda surprised but not really.

With an investigatory explanation due out in a few days, Absolute Poker and Ultimate Bet are merging to form a new site — now the third largest in the world — called “Cereus” — the name for a desert cactus that stands strong and stays prickly in even the harshest environments. A related species is the Cereus uruguayanus, which may or may not lend credence to Oliver’s prediction that very soon the WSOP will move to Montevideo we could see the WSOP in Punta del Este.

The name could also have been inspired by the night-blooming variety:

One of the strangest plants of the desert, the Night-bloomiing Cereus is a member of the Cactus Family that resembles nothing more than a dead bush most of the year. It is rarely seen in the wild because of its inconspicuousness. But for one midsummer’s night each year, its exquisitely scented flower opens as night falls, then closes forever with the first rays of the morning sun.

Aww, so sad, and yet so precious and sweet …

Another operation with a claim to the Cereus name is Bacillus Cereus:

an endemic, soil-dwelling, Gram-positive, rod-shaped, beta hemolytic bacteria that … is known to create heavy nausea, vomiting, and abdominal periods.

Supposedly, according to the first link in this post, this site is gonna be great — it’s the result of all sorts of innovative technology and customer service. The announcement says nothing about it being all cleaned up with the best security out there — and from a PR perspective can you blame them? — even though theoretically this company should have more knowledge than anyone else about how a site’s integrity can be compromised.

Ret. Sen. Alfonse D’Amato stops short of calling for UN intervention in the Kahnawake Territory, but he does express a desire to go after rogue online poker companies. This just in over the e-transom, from the Poker Players Alliance:

Statement of PPA Chairman Senator Alfonse D’Amato in Response to Online Poker Cheating Scandals

Washington, D.C. (July 22, 2008) – Former Senator Alfonse D’Amato, chairman of the Poker Players Alliance (PPA), the leading poker grassroots advocacy group with over one million members nationwide, today issued the following statement in response to recent online poker cheating scandals.

“The Poker Players Alliance (PPA) is the political and public policy voice for poker players in America. Central to our mission are advocacy efforts in Washington D.C. and around the country to protect poker players from misguided and vague laws and to establish licensed and regulated Internet poker in the U.S. To be clear, the PPA is not a regulatory body for poker players or the poker industry, nor do we seek to be. We are, however, compelled to speak out when our public policy mission is potentially undermined by actions which present Internet poker in a negative light.

“Trust is paramount in poker. Sadly, this foundation has been undercut by admissions from two well-known online poker companies, Absolute Poker and Ultimate Bet, that cheating has occurred on their poker sites. The Poker Players Alliance condemns any and all cheating in poker no matter the forum in which it is played. Because of the current legal uncertainties and the lack of federal regulation and oversight, it is especially troubling when cheating occurs in online poker. This has created an untenable atmosphere and has denied the proper means to investigate allegations, administer due process and then apply appropriate penalties for the wrongdoers. We urge these companies and their regulating authority, the Kahnawake Gaming Commission, to provide a full and transparent accounting of these breaches of the public trust to help lift the black cloud that has been placed over the industry.

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Happenings this evening, while I make this part small so you can read all the good stuff below:

The $5k NL Shootout final table is down to headsup. The current chip leader winner is Phil “The Chairman” Tom. His son, Scott, was the founder of Absolute Poker, and we know how that turned out. (Readers may want to insert their own superuser jokes here). Greg “FBT” Mueller is in a close finished 2nd, while Leo Wolpert was recently eliminated in 3rd.

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Hey Jen, check it out … Pauly has some interesting thoughts on the matter: [via Wicked Chops daily email]

If you play online poker (especially if you are one of the blind fools still playing on UB), it’s in everyone’s best interest to spread the word on this important thread…

Superusers and Silence: How UltimateBet let players get cheated for millions by Steven Ware & Cornell Fiji (2+2)

One of the more interesting things to me, however, is a comment from Change100:

Funny, how on the day you post about the UB cheating scandal, Card Player.com is running these two headlines:

“Absolute Poker Offering Up to 100% Reload Bonus”

and

“Ultimate Bet RAI$E Program Gives Money for Points”

Duly noted. And that, dear readers, is something to keep in mind as you follow the WSOP on the internet this summer. We know your company internet time is limited, after all … and though we “professional” bloggers don’t have nearly the resources of the big-boy poker media, you can probably trust us more not to greedily lead you astray.

Though we make our livings, too, covering poker, it was only a few years ago that we made virtually no money whatsoever … we did it just for funsies and booze/tax deductions … and because of these faint but not-too-distant memories, it’s a little easier for the independent bloggers out here to be semi-principled and give you coverage not driven by the pursuit of potentially dirty cash. Drugs and hookers notwithstanding, of course.

On March 6, UltimateBet acknowledged that at least one player exhibited an abnormal winning rate on its site. They noted that a third-party audit was in the works, and a complete and thorough investigation was promised.

A few interesting tidbits:

1. UB admitted that it was made aware of the allegations on January 12. They didn’t begin a formal investigation until March 6. It is now May 15, and not a peep has been heard from UB.

2. There are similarities between the UB scandal and the Absolute Poker scandal that stink of more than coincidence.

3. UB has not responded to inquiries on the subject.

A poster on 2+2 broke down the details of the scandal thus far. And Nat Arem posted on PocketFives that he has information that he simply cannot release (???) but assures the public that UB is working on the issue.

Not good enough. It has been too long. UB made the same mistakes as AP - taking too long to admit the problem, resolve it, and communicate with players about it. It is just unacceptable, and I, for one, will continue to publicize the scandal and recommend that players stay far away from Absolute Poker and UltimateBet. (This opinion does not necessarily reflect that of Pokerati.)

I like to troll Craigslist every so often for some hot, anonymous NSA poker action. Not looking for games — there’s no shortage of ‘em here in LV — just wanting to take the pulse of what people are pushing related to poker. Look at the ads all together and you get some interesting tells on the state of the poker world and its semi-anonymous inhabitants:

There are a lot of chips , tables, fancy custom tables and chips and tables for sale, of course, and for $15 a made-for-TV WPT video game. WSOP: Tournament of Champions for the Playstation goes for $8

For $150k you can have documentary footage of the rise and fall of Jamie Gold.

A WSOP baby’s blanket.

More chips, from the Aladdin, and from the Atlantic City Playboy Club. “Omaha Table” from Sante Fe Station.

Perhaps frighteningly, there are even poker bots for sale. At least one suspicious reader is questioning whether or not this is legal.

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What exactly does the Poker Players Alliance (PPA) stand for?

Frank Frisina of Life’s a Bluff has posed that question, specifically as it relates to the organization’s mission statement that, in part, says it will ensure the integrity of the game of poker. The fact that the PPA would not and will not make an official statement about the recent online cheating scandals at Absolute Poker and UltimateBet was a major concern for Frank. And upon the conclusion of an e-mail interview with John Pappas, Executive Director of the PPA, Frank decided that John’s answers - or non-answers - were the straws that broke the donkey’s back.

Frank has officially terminated his membership with the PPA and has explained his reasons in great detail. Life’s a Bluff as a whole has also stopped any support of the PPA. He asks that others who agree with him stand up and do the same.

The introduction and the interview are well worth the read, as Frank poses some serious questions to the online poker community about organization, legislation, regulation, and membership organizations like the PPA.

The UltimateBet cheating scandal is in full swing, as a third-party investigation has been ordered. As stated in a PokerWorks article, UB has confirmed that a player with the moniker “NioNio” had unusually high winning statistics and may have had an unfair advantage over other players.

Sound familiar? Does Absolute Poker ring a bell?

In some people’s minds, the Absolute Poker scandal was resolved when the Kahnawake Gaming Commission released its final decision on the matter. But to others, something didn’t seem right. And at the same time, there were already forum topics dedicated to allegations of cheating on AP’s sister site, UltimateBet. It’s all so confusing interesting.

Here are a few links to piece together:

1. Absolute Poker and UltimateBet are both owned by Tokwiro Enterprises. The owner of Tokwiro is Joe Norton, the man who served as the Grand Chief of the Kahnawake Mohawk Territory for about 25 years.

2. The Kahnawake Gaming Commission released its Absolute Poker scandal decision on January 11, 2008. UltimateBet’s press release acknowledges that it became aware of cheating allegations on January 12, 2008.

Coincidences? Really?

It seems that CBS’ 60 Minutes is in the process of putting together a story about the Absolute Poker cheating scandal. Nolan Dalla discussed it in his blog on PokerListings earlier this week.

Some of the key players in the drama - one that has been playing out in the poker media since the Fall of 2007 - will be interviewed, and the show’s team seems to be investigating it thoroughly.

I’ve been writing about the Absolute Poker scandal for some time as well. I continually bludgeoned the subject in my Poker Player Newspaper column and in any other outlet that would allow it. After the story lost its dazzle in the poker media, I kept it going as I felt it was never sufficiently investigated or resolved.

While I wholeheartedly wanted the poker community to take notice, take a stand, and take action against Absolute Poker, I’m not sure how I feel about a show like 60 Minutes bringing it to the general public. Part of me believes that such notoriety will bring the government closer to realizing that regulation is the key to preventing this in the future. The other part of me is afraid that this will put poker firmly in the “poker is gambling” and “gambling is immoral” category with the unreasonable powers-that-be.

Looking for opinions here… Please weigh in.

California Jen is gonna be on the internet radio tonight — co-hosting Keep Flopping Aces with Lou Kreiger. They’re rolling live at 6 pm pacific on roundersradio.com.

Their topic for one hour will be the Absolute Poker cheating scandal — which isn’t going away, as much as a lot of folks probably wish it would. (Jen has been all over it for PPN.) Click on over to listen, or check RR’s archives after the fact.

Now Ultimate Bet, sister site to Absolute Poker, is under intense scrutiny from the intelligentsia at 2+2 … who seem to be looking — and finding — semi-mathematical proof of another “superuser” account. (Thanks, Enrique, for the heads-up.) Click above to read the thread.

At first it appeared that UB Pro Phil Hellmuth was already speaking out on the matter — but emails supposedly from Hellmuth were quickly discovered to be a hoax. However … that has since led to a real, unofficial response from Phil, shared second-hand from a presumably respectable poster named trambopoline:

Anyways after tracking down Phil at the tables I finally got a hold of him, this time for real. I just got off the phone wiht him after speaking with him for well over an hour. He informed me that he understands I made an honest mistake and totally forgives me, and even informed me to post that he said so. We went over the accounts in question and I got to say, he was very suspicous to say the least. . He informed me that UB has already started an investigation and that info should be released within the next few weeks.

Hmmm … developing …

Without much choice in the matter, Absolute Poker has spoken in the form of a press release from Anna Molley, Vice President of Public and Community Relations.

In short, AP thinks the Kahnawa:ke Gaming Commission report is complete and accurate. AP “regrets” the “inadvertent” deletion of records and is most happy to put this “most distressing and regrettable” experience behind them.

Well, as long as AP is happy…

AP is also initiating a series of poker security summits to discuss security with “respected and independent members of the poker community.”

The site is just glad to “close the book on this sordid affair.” Wow. Poor AP. They’ve been through so much…

Here is the full press release: More…

We know that some head-honchos at Absolute Poker cheated at their own game, thereby stealing money from their players. Upon being unequivocally exposed, they have tried to apologize and make right … as if a carjacker who gets caught could also get off the hook by simply saying, “Oops, sorry about that … my bad,” and returning the stolen property.

Yet for some reason, thousands of real-money-players are still in action at Absolute. Hey, I know you! You’re that guy who stole my car! Thanks so much for giving it back. So wow … you’re a valet parker now. OK, here are my keys. But whatever … maybe the numbers have something to do with all the ad dollars being happily accepted by the poker news sites and print publications that supposedly insist on limiting their coverage to “what’s good for poker.”

Sorry, am getting off track. Personal rant against the machine. So yes, Absolute Poker scandal … California Jen has been covering it for Poker Player Newspaper, and she appeared on Lou Krieger’s Keep Flopping Aces last night to discuss developments. I’m listening to it now … and it’s a pretty good show — especially when they get an unexpected call from Chuck Barnett, who you may remember is on the Board of Supervisors for Mohawk Internet Technologies / Kahnawake Territory. He engages Jen and Lou with all sorts of good information on the make-up of the ongoing investigation, a little bit of what they are uncovering, and some insight into who are the true owners of Absolute Poker.

Click here to listen to the show.

“Is it Joe Norton?” Kreiger asks directly at one point. And indeed it is. Apparently Norton is the sole owner of Tokwiro Enterprises, which owns Absolute … and perhaps like Dick Cheney is to Halliburton, Norton is also a former Grand Chief of the Kahnawake Mohawk Territory. To be honest, I’m not sure what all these connections mean … but I’m pretty sure they are not “good for poker.”

The Kahnawa:ke Gaming Commission has concluded its investigation into malfeasance at Absolute Poker.

Click here to read the whole thing.

The main conclusions:

1. Beginning on August 14 and continuing for six weeks, various accounts were used to view hole cards, and the person(s) responsible have been removed from any role at AP.
2. After the activities took place, person(s) associated with AP operations deleted records and gaming logs to hamper the investigation.
3. No evidence shows that AP sanctioned or initiated the activities.
4. Principles of AP failed to contact the Kahnawa:ke Gaming Commission within 24 hours of becoming aware.
5. AP reimbursed all players with interest, but anyone who still wishes to make a claim can do so within 60 days of this report.
6. AP has taken appropriate actions to address the “vulnerability in its systems” to prevent this from happening again.

Sanctions against Absolute:

1. AP operations will be subject to random audits of logs and records over the next two years, the costs of which will be paid by AP. The site must also implement a continuous compliance program, and any person(s) responsible for any part of the cheating scandal must be removed from any role at AP, which the Commission feels has been done.
2. AP must pay a fine to the Commission of $500,000 due within 60 days.
3. AP must give a security deposit to the Commission to be held for two years which may be used to offset the cost of any future breaches of rules, laws, and regulations.
4. AP must pay the Commission for all costs incurred through the investigation, including the audit.

Finally, there is a resolution to this matter.

More…

The Absolute Poker scandal should have been enough. It remains unresolved, though most of the details of the cheating have been made clear, and the poker public still awaits the conclusion of the audit.

Back in early October, there was another mini-scandal on PokerStars. The winner of the WCOOP main event — the largest online poker tournament in history — was disqualified, and “TheV0id” was stripped of his title and $1,378,311 in winnings.

And we have another.

This time the allegations of nefarious online play revolve around Bluff Magazine’s managing editor Chris Vaughn. On 10/21, he took down the $1 Million Guarantee tournament on Full Tilt Poker for $197,984. The following Sunday, he won the Sunday Million tournament on PokerStars for $240,633. Well, it seems the first one didn’t stick.

According to the second place finisher in the Full Tilt event, Soren “Kongsgaard” Kongsgaard, he received an e-mail from FTP stating that Chris - screen name “BluffMagCV” - had been disqualified and “Kongsgaard” was awarded first place money.

Reportedly, though unconfirmed at this point, Chris’ backer, Sorel “Imper1um” Mizzi, took over at some point in the tournament and played the remainder of it for him. Chris and Sorel have now been banned from Full Tilt. More details can be found on Sorel’s blog, though it’s not clear who is writing the posts.

Interestingly, Chris was just interviewed on 11/18 by Scott Huff and Haralabos Voulgaris on Big Poker Sundays, a radio show on PokerRoad.com. Haralabos asked him if he’s ever been accused of ghosting, where a person’s backer plays for them, and Chris said, “I’ve been accused of that. I think it’s going to come with the territory when someone relatively unknown wins two in a row… But as far as having someone take over, that’s ridiculous.”

Cardplayer has published a statement by Absolute Poker claiming there is not now, nor has there ever been, a super-user account enabling anyone to see another player’s hole cards on their site. I guess they call it something else.

In a weird way, you can see how Potripper might have convinced himself it was still something of a game:

Click here to see the rest of this 4-part series.

Call me sick for thinking this, but there is a thing or two you can learn about strategy from watching these.

Discussion of the Absolute Poker brouhaha carries on. Currently all eyes are focussed on Mark Seif, as the forum sleuths who cracked the case to reveal an online poker company’s crooked ways are now looking for a Saddam Hussein to execute … you know, since we can’t really find Osama bin Laden AJ Green.

One poster on 2+2 actually transcribed some of my recorded conversation with Seif, revealing the masterful interview techniques of a highly skilled professional journalist:

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