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October-22-2007,
For the Future of Online Gambling Absolute Poker Must Satisfy it's Critics...By Hartley Henderson

The online poker community has been shocked by allegations of cheating in a poker tournament at the site Absolutepoker.com a little while ago. The concern is that if this could happen once, what safeguards are in place to ensure it can't happen more often? Here is the condensed notes version of what happened.

- After losing a $500 buy-in tournament at AbsolutePoker.com, the second placed player suspected that the winner of the tournament who went under the screen name "Potripper" was cheating. The player emailed the company and a clerk from Absolute Poker sent him an Excel spreadsheet which listed the play of every hand from every table at that tournament as well as noting all observers of the tournament.

- Upon sharing the spreadsheet with others at a poker forum, poker and database experts noted some very unusual play by Potripper. In the first 2 hands of the tournament Potripper folded pre-flop, but then after an observer came into the room, Potripper never folded another hand for the next 20 minutes. This action led the experts to believe the "observer" was somehow working with Potripper.

- Examining play during that 20 minutes, it was found Potripper was playing very unconventionally, raising with garbage and thus forcing players that were well ahead in the hand to fold. At the same time he would often fold good hands for no reason including one hand where he openly folded KK when another player had AA. This play was extremely suspicious and had almost everyone who looked at the playing style believing that Potripper could actually see the hole cards of others and was playing accordingly.

- Poker forums picked up on the possible cheating and began looking further into the accounts of observers and Potripper himself. Potripper turned out to be AJ Green, a former director of Absolute Poker and a current director of Nine.com. As well, one of the observers of the game is a man named Scott Tom who was Absolute Poker's president until 2005 and also a very close friend of AJ Green. Scott Tom is also believed to be associated with Absolute Poker today and the IP address of his account belongs to riveieraltd.com, which is on the Kahnawake reserve outside Montreal where Absolute Poker's servers are located. In fact several of those in question had accounts with the rivieraltd.com domain name.

For the sake of this article it is sufficient to stop the extended details at this point, but it must be noted that Absolute Poker went into denial mode and did everything in its power to make the story go away, including removing the DNS information for rivieraltd.com, firing the clerk that sent the Excel spreadsheet and constantly refusing to acknowledge any wrongdoing. More and more evidence came up implicating the company, and after national media coverage of the events (including articles written in the New York Times and Houston Chronicle), the company admitted its software was compromised and would be issuing payouts to the legitimate winners and refunding anyone who was affected by the game. They also stated they will conduct an internal investigation and deal with those that were implicated in the apparent scam.

Clearly Absolute Poker hopes that this will be the end of the incident and it will be business as usual, but the online gambling community must assure that it doesn't end there. From the onset of internet wagering there has been concern about the legitimacy of games. In fact, that was the main concern expressed by John Kyl when he introduced the first internet prohibition bill in 1997. Software providers and online wagering websites assured the public and the government that Tom Foolery with the software was impossible. They provided audited reports which demonstrated all games were random and it seemed to sway many. While the U.S. government seems determined to keep online gambling illegal, a groundswell has developed that could provide hope for the future of the industry and particularly for poker. However, that support could end abruptly if there is any proof that online gambling's legitimacy can be compromised. It is thus imperative that Absolute Poker not look at this as an isolated situation and try only to deal with the individuals that apparently cheated. Instead, Absolute Poker, in conjunction with the software provider, must identify how and why the incident could occur in the first place to prove to the public that online gambling is not fixed. Some of the questions that must be asked are as follows:

- If people from the company look at all the cards throughout the tournaments, is that a good idea? Perhaps hands should only be reviewable once the tournament is complete. This would eliminate any concerns and make it impossible for others at the company that are monitoring the games to work with players. If, on the other hand, cards must be observed by staff on a continuous basis, what safeguards can be put into play to make it virtually impossible for shenanigans to occur?

- What background checks are done on staff, particularly those in charge of security? A report from 2 plus 2 poker forum suggested that a security manager at a companion site was involved in other suspect games. Safeguards must be put into place to make sure that everyone is monitored on a regular basis, including staff.

- What can the company do to address all stated concerns from players and improve customer service? Clearly if the company tried to address the situation from the outset rather than deflecting blame they could have stopped the negative press in its tracks. As well, the company has to look at internal policies.

- Lastly the company must determine what punishment it is willing to level on Green and Tom if it is revealed that they were indeed the scammers. Public perception in this case will be everything, and if these individuals (managers or not) are able to get away with a scam, it will bring the legitimacy of Absolute Poker along with all other poker sites into question.

Furthermore, the Mohawks of Kahnawake must look at their policy that determines who can set up servers on their territory and determine if more stringent rules need to be in force. The UK and Antigua have very strict rules that determine who can operate in their jurisdiction and they will disqualify any people they deem as unfit to operate. The forums have suggested that AJ Green ran internet scams prior to working for Absolute Poker. If this is indeed true then clearly more background checks of managers are necessary.

There are 2 bright spots in this ugly incident. First, there is relief in the fact that sports betting can not be compromised in the same manner as poker. Obviously sportsbook operators can leave town without paying, but most jurisdictions require the books to post up money covering all player accounts to avoid this circumstance. Regardless, games are time stamped and it is easy to determine if someone is cheating. Naturally the players themselves or others involved in the games can cheat as was witnessed with the Donaghy scandal and the Polish Open tennis tournament earlier this year, but the sportsbooks themselves can not fix games in any manner. Perhaps it is for that reason that Australia has banned online gambling for everything except sports.

The other bright spot relates to the island of Antigua. With all the licensed sportsbooks, casinos and poker rooms located in that country, there has not been one complaint of impropriety regarding the games. Antigua has been in operation offering online wagering far longer than Kahnawake and most of the sites are bigger. The country has assured authorities that its regulatory requirements are above reproach, which is one of the reasons so many companies are willing to pay hefty fees to operate there. In its fight with the United States over the U.S. withdrawal of gambling commitments, Antigua has pointed out over and over that their regulatory system is as effective as anything that can be found elsewhere, including Las Vegas. The fact that Antigua has offered online wagering for a full decade now with absolutely no complaints by the public seems to prove their point.

Online gambling was suspect from the beginning and with good reason. Why would anyone be willing to put real money on a hand of blackjack or Texas Hold 'Em when they have no idea what safeguards are there to ensure the game's legitimacy? Nevertheless, the general public put its trust in the betting sites and it seemed to pay off. Audits and other regulatory vices proved to the sceptics that the games were legitimate. Consequently, internet wagering grew to a $12 billion industry. There is still some hope that bills like those offered by Barney Frank will someday be accepted and internet wagering will be legal in all regards. However, this will never happen if there is belief the games or the operators are not on the up and up. For the sake of the entire industry it is necessary that Absolute Poker prove that this incident was a fluke and put in safeguards to ensure it can never happen again. As well, Absolute Poker must make examples of anyone involved in the scam, including managers if necessary. Not only is money at risk, but public trust of online gambling as well.

10-21-2007
Hartley Henderson
MajorWager.com
henderson@majorwager.com

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