The software problems at UB appear to continue, here’s a hand posted on 2+2 from this afternoon. It doesn’t involve a name player, but it does show a player winning a pot with no hand at all, literally:

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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.

This was my “career horoscope” yesterday:

Assuming you understand others is a big mistake. Bypass the analysis and stick to your own work.

Oops, but oh well, too late now … The podcast is up.

Because Gary Wise relies on me to tell him and his listeners how to think Hevad Khan canceled … (right)click here to listen to/download the entire episode (including the opening segment with Dewey Tomko) or press the buttons below to hear my segment — where GW hems and haws as I analyze the 60 Minutes and Washington Post pieces, then speculate wildly on the cheating scandals and their relationship to the present business/legal/political landscape and what it all may or may not mean for the future of the entire world! poker industry.

Wise Hand Poker (feat. Dan from Pokerati) 42:08
RoundersRadio

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Back in May, Cliff “JohnnyBax” Josephy joined Team UB to much fanfare. A few minutes ago, he posted on 2+2 this message:

Just wanted you guys to know that you will no longer see me as a redlined pro in their lobbies, nor will you see me wearing their patches at live events any more.

That is all for now,

Bax

More updates when available, in the meantime Bax still appears as a pro bounty on their site.

Update: Bax’s staking partner Eric “Sheets” Haber added the following in the 2+2 thread:

The reason why Bax is no longer a UB pro is simply because UB renegged on its deal with him.

I was there for the phone conversation and can attest that this is the case.

They called him and openly renegged on their agreement without explanation and should be ashamed for doing so imo.

Ultimate Bet reneging on a promise? Say it isn’t so!

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.

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.

A press release was just received from Tokwiro Enterprises, noting that a settlement was reached between Excapsa Software (previous owner of UltimateBet) and Tokwiro Enterprises (current owner of UB) for $15 million. The amount is the same as what was still owed to players who were cheated in the UB scandal, as determined by the Kahnawake Gaming Commission in its decision on the case, and those players have now received their refunds.

COURT APPROVES $15 MILLION SETTLEMENT OF TOKWIRO CLAIMS AGAINST EXCAPSA SOFTWARE
Tokwiro Claimed Damages As A Result of UltimateBet Cheating Scandal
Refunds To Affected Players Completed

MONTREAL (NOVEMBER 5, 2008) — Tokwiro Enterprises, ENRG (“Tokwiro”), the owner of AbsolutePoker and UltimateBet, today confirmed the settlement of its claims against Excapsa Software, the previous owner of UltimateBet. The Honorable Madame Justice Sarah E. Pepall of the Ontario Superior Court of Justice endorsed the settlement on November 3, 2008. Under the terms of the agreement, Excapsa will pay US$15 million to Blast-Off Ltd., the Tokwiro-controlled company that originally acquired UltimateBet. This payment will be used immediately to refund players who were affected by the cheating scandal that Tokwiro inherited when it purchased the business from Excapsa.

Paul Leggett, Tokwiro’s Chief Operating Officer, said: “We are pleased that we have finally agreed to a settlement with the previous owners of UltimateBet, and we are happy to announce the completion of the final refunds to players. Together with our regulatory body, the Kahnawake Gaming Commission, we have fought long and hard to hold those responsible accountable for the fraud, to refund players, and to ensure this can never happen again. Now that the main perpetrator has been named, the settlement with the previous owners is behind us, and players have received refunds, it should now be apparent that Tokwiro had no involvement in this cheating and that we have fought to correct it with every tool at our disposal.

“We continue to reserve the right to pursue further legal action against any individual or individuals involved in stealing from us or our customers. With this settlement, however, our claims against Excapsa are satisfied, and all player refunds will be completed. This brings us significantly forward in our search for justice in the aftermath of the cheating scandal,” concluded Mr. Leggett.

For those who recall the sanctions the Kahnawake Gaming Commission gave to Ultimate Bet regarding the “NioNio” superuser scandal, UB was given until Nov. 3rd to start dispensing refunds to affected customers. However, the pending litigation between Blast-Off Ltd and Excapsa Software Inc. as detailed earlier this year on MSNBC.com has not yet been completed although terms of a settlement are nearly complete. Discussion of the settlement can be found over at 2+2. The company handling the liquidation, WSBG Consulting had a hearing Monday on the settlement and it appears that at least $15m more is due to players affected in the scandal. For those wondering why it’s taken so long for this matter to be settled, going through all the documentation on WSBG’s site and of the previous liquidator Mintz and Partners Limited would be a daunting task for anyone with an interest in the case. Expect some sort of state from UB either Tuesday or Wednesday with further details.

Some other information::

The purchase price that Blast-Off Ltd. paid to Excapsa has dropped from $130m to $81.4m.
Russ Hamilton, owner of 4,304,720 shares of Excapsa, had his shares canceled.

UPDATE: Wicked Chops Poker is reporting that Annie Duke may be leaving Ultimate Bet, and also may have won Celebrity Apprentice.

Refuted by Annie on her blog.

UPDATE #2: Wicked Chops also reports that the 60 Minutes piece on AP/UB will NOT air this coming Sunday.

UPDATE #3: Wendeen Eolis in Poker Player Newspaper reports that Mark Seif is leaving Absolute Poker.

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).

The Kahnawake Gaming Commission (KGC) has released its initial findings in the UltimateBet scandal. There are some jaw-dropping facts in the statement, like the $6.1 million figure that the KGC states has been reimbursed to cheated UB players, which does not include more reimbursements that are to commence on November 3rd. And Russ Hamilton is officially named as the main person responsible for and said to have benefited from the UB scandal.

Interesting to note that the KGC chose to release this statement as the Aruba Poker Classic gets underway…

(Thanks to Kevin Mathers for the heads-up, and MajorWager.com for being the first website to have reprinted the statement in full.)

The entire statement is as follows:

Kahnawa:ke Gaming Commission Imposes Sanctions on Ultimate Bet with Regard to Cheating Incidents

For immediate release

(MOHAWK TERRITORY OF KAHNAWAKE – September 29, 2008) Kahnawa:ke Gaming Commission (“KGC”) Chairman Dean Montour today announced the initial findings of the audit conducted on licensee Ultimate Bet, as well as the sanctions to be imposed.

According to KGC Chairman Montour, the Commission has reviewed the information provided to it over the past months from Frank Catania of Catania Gaming Consultants of New Jersey; Gaming Associates, an Australian game testing company; and the permit holder. Chairman Montour said, “The Commissioners have made several findings of fact with regard to the cheating that occurred on the Ultimate Bet web site that included the identification of some of the individuals responsible for these incidents as well other significant violations of the Kahnawa:ke Interactive Gaming Regulations.”

The Commission found clear and convincing evidence to support the conclusion that between the approximate dates of May 2004 to January 2008, Russell Hamilton, an individual associated with Ultimate Bet’s affiliate program, was the main person responsible for and benefiting from the multiple cheating incidents. Furthermore, the KGC is currently in contact with the appropriate law enforcement agencies and intends to fully cooperate in the prosecution of all individuals involved in the UB cheating incidents.

Mr. Catania states, “My intention is to provide further information as it is uncovered, although the information already submitted to the KGC relating to Ultimate Bet warrants the KGC taking the actions it has today. Any further evidence uncovered with regard to cheating, withholding or destroying records in our continuing investigation will be reported to the KGC and the proper agency for appropriate action.”

As a result of the KGC’s findings of fact, the Commission called a special meeting, at which time it was unanimously decided to impose the following sanctions against Ultimate Bet:

1. Ultimate Bet is directed that by November 3, 2008 it shall, under the close supervision of the KGC, its employees and agents, commence refunding all players accounts found to have been adversely affected by the cheating of individuals under the control and supervision of the licensee. It is estimated that Ultimate Bet has to date reimbursed $6.1 million USD to players’ accounts found to have been adversely impacted by the cheating activity

2. Ultimate Bet is directed that by November 3, 2008 it is to remove any and all persons deemed as “unsuitable” by the KGC from all involvement with the company, which shall include all levels of ownership, management and operation. Ultimate Bet during that time period until November 3, 2008 is required to continue to provide complete details of all day-to-day operations of the company. These shall include financial as well as daily gaming records to Frank Catania and or his assigns. It is anticipated that this action will provide full disclosure and prevent any further improprieties or wrongdoing from occurring while ensuring that the public is being offered fair and honest games and all player monies will be protected.

3. Ultimate Bet’s control system as defined in section 9 of the Kahnawa:ke Interactive Gaming Regulations has been modified to prevent any further incidents of cheating or related improprieties.

4. Ultimate Bet will not delete or modify any logs including but not limited to web logs and game logs as required by the Kahnawa:ke Interactive Gaming Regulations and will continue to have those logs immediately available for inspection by the KGC or its agents.

5. Ultimate Bet shall immediately pay a fine of $1.5 Million USD to the KGC for its failure to implement and enforce measures to prohibit and detect fraudulent activities.

6. Ultimate Bet’s failure to comply fully with these measures will result in the immediate revocation of its KGC gaming permit.

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…”

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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.

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