UltimateBet CEO Paul Leggett Comments on Scandal Findings

I wanted to blog today to discuss the recent decision by the Kahnawake Gaming Commission that was released on Friday.

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.