Friday, October 10, 2008

KGC Orders Investigation of UltimateBet & Absolute Poker Parent Company

Source: Jennifer Newell Online Poker Player Newspaper

The Kahnawake Gaming Commission (KGC) finally stepped into the UltimateBet cheating scandal to issue a statement in late July, more than seven months after a cheating scandal that featured superuser accounts able to see everyone’s hole cards was allegedly reported to UB. The company that issues and regulates the gaming licenses for UB and numerous other online poker sites told the public that it has been integrally involved in the investigations.

This column has not been short of discussion about Tokwiro Enterprises, the company that purchased Absolute Poker and UltimateBet—both online poker sites that came with cheating scandals that would be unveiled after the sales. Not only did Tokwiro discover that cheating had been ccurring through player complaints and rogue player investigations—not through its own due diligence or security measures—but neither AP nor UB lost their gaming licenses as a result. Could that have something to do with the fact that the owner of Tokwiro, Joe Norton, was Grand Chief of the Kahnawake Mohawk Territory for nearly 25 years prior to his 2004 retirement? Draw your own conclusions there.

The KGC’s July statement touted its own “exemplary” record of regulating online gaming for over nine years, but acknowledged that no industry is “…immune from abuse.” In discussing the AP and UB scandals, KGC gave credit to the players who brought these issues to light, and with specific regard to the ongoing UB investigations, noted that it has played a large role in ensuring that the system leaks were identified and rectified and that cheated players were being reimbursed. The regulatory body’s decision was supposed to be issued within the “next several days.” It was not.

Instead, four days later, another statement came from the KGC, this one a bit unexpected. “Effective immediately, the Kahnawake 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 … 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 Kahnawake 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 UltimateBet and Absolute Poker have submitted to full compliance with the directives issued by the KGC and recommended by the independent monitor.”

The statement goes on to say that any failure by the licensees to comply “could result in immediate revocation of their license privileges with the KGC.” This is the first time during either scandal that the KGC has seriously floated the possibility of revocation of a gaming license. And the very seriousness of this Tokwiro investigation itself lets it be known that the KGC is willing to put its own former Grand Chief under a spotlight to try to alleviate any concerns that special treatment is being provided in this case.

Upon the conclusion of Mr. Catania’s investigation of Tokwiro Enterprises, the KGC will review the report and use it in conjunction of other UB and AP investigations to comprise a final decision regarding these scandals.

For the sake of the poker community and the future of online poker, it is not unreasonable to expect a reasonable amount of transparency and a sense that no stone has been left unturned.