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Online Poker Cheating Costly, Unpoliceable



Over the past two years, the largely unregulated business of online poker has seen two major cheating scandals, according to a joint report by '60 Minutes' and the Washington Post.

Players on the poker site Absolute Poker uncovered the first of the two scandals in August of 2007, when one apparently novice player, known as "Grey Cat," began consistently winning high-stakes games. After pressing the site administrators for information, the amateur investigators finally discovered that the too-lucky player was, in fact, a former employee of the Web site who had cracked Absolute Poker's software code. Although administrators conceded this fact, and instituted $1.6 million worth of refunds to its players, they refused to make public the cheater's identity.



Because online poker is illegal in the United States, and because Absolute Poker is headquartered in Costa Rica, there is no course of legal action available to the complainants. The tin-star sheriff of the online poker world, the Mohawk Indian-owned Kahnawake Gaming Commission, did nothing more than fine the company $500,000, allowing its owners to keep their license.

Probably emboldened by the lawlessness exposed in this first scandal, a player or group of players on the site UltimateBet.com launched a similar cheating campaign in early 2008. Suspicious, players again launched their own investigation. This investigation lead to UltimateBet.com's admission of cheating and refunding players $6.1 million. But, as did Absolute Poker, UltimateBet.com refused to identify the cheater, or cheaters.

This scandal, and the site's refusal to name the culprit, lead the Kahnawake Gaming Commission to hire Frank Catania, a former New Jersey gaming official, to investigate. This past September, Catania delivered his findings: cheaters took their prey for close to $20 million over the course of several years. The Gaming Commission fined the site $1.5 million and found former World Series of Poker champion Russ Hamilton to be the primary culprit.

Despite these findings, little can be done to address the problem outside of these fines and censures.

We'll just take the conservative tack and stay off the Web sites; If you don't play, you won't pay. [From: 60 Minutes via Cnet and Washington Post]

Tags: cheating, gambling, poker

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