Absolute Poker and UltimateBet were online poker rooms that served U.S. players. The two sites merged player pools in November 2008. Each had its own insider cheating scandal before the sites were combined.
UltimateBet was one of the largest online poker rooms in the early 2000’s. It found immense success with its fast software and house pros that included Annie Duke and Phil Hellmuth. It was one of the first sites to offer unusual games, like Seven Card Stud High/Low, Pineapple, Pineapple High/Low and Royal Poker.
UltimateBet’s software had a flaw in it that was created through a rogue programmer. This allowed players that had control of the account the ability to see the hole cards of other players at the table. This clearly gave the cheater a massive advantage over other players at the table. The only way that the cheater could lose is if a legitimate player got all in before the river card and drew out on him or if the cheater purposely lost the hand.
The security team at UltimateBet was either completely incompetent or was in on the cheating. Massive transfers occurred between Russ Hamilton and his friends over the course of several years. UltimateBet only admits to cheating from 2005 to 2007, however, many players feel that this occurred as early as 2003.
The win rate of Hamilton and several of his friends was simply impossible. They rotated through dozens of accounts and used the cheating software to observe the table. The cheaters would communicate the hole cards and act based on the ability to win the hand.
In December 2007, players became suspicious of an account by the name of Nionio. His win rate was massive. It was impossible to comprehend considering the player’s flop rate was nearly 70%.
This was first posted in the High Stakes No Limit forum at Two Plus Two. Other players began to search their Poker Tracker statistics for Nionio and discovered the same impossible results. Nionio had won 155 big bets per 100 hands in a sample size of 2,984. This is 20 times higher than the best player in the world could do.
UltimateBet ignored the irrefutable results compiled by players for three months. In March 2008, UltimateBet finally admitted that there was something unusual about the win rate of this player. Meanwhile, players had uncovered numerous other cheating accounts.
UltimateBet finally caved and decided to issue refunds to some affected players. They tried to only pay about $5 million. The backlash was fierce. The company eventually paid out about $20 million. The problem was that this money was not paid by Hamilton or others that benefited from the cheater. It was paid from player deposits. This would later doom the company.
In 2012, a tape created by Travis Makar was released to the public. It included a tape recorded conversation between CEO Greg Pierson (now of iovation), Russ Hamilton, and two lawyers. The group discussed how to cover up the crime. On the tape, Hamilton admits that he was the one that stole the money. Remarkably, some within UltimateBet were able to get licensed gaming work in other jurisdictions even though it was home to the largest cheating scandal in online poker history.
Absolute Poker Cheating Scandal
UltimateBet’s cheating scandal occurred before the Absolute Poker one. The cheating at Absolute Poker was actually uncovered months before the UB incident was unearthed.
In August 2007, a player by the name of Potripper won the weekly $1,000 tournament at Absolute Poker. He did it with amazing fashion. He ran through the tournament, folding at the precise time he needed and winning every showdown. It all ended when Potripper was heads up against CrazyMarco.
Potripper called unimproved ten-high with no draws into a semi-bluff made by CrazyMarco with nine-high that included a flush draw. The ten-high hand held up and Potripper won the tournament.
CrazyMarco complained to Absolute Poker support about the suspicious play. He was given a spreadsheet of the tournament that he could not decipher and for the time being dropped his pursuit of what actually happened.
In September 2007, players became suspicious of the players Greycat, Doubledrag, and Steamroller. These players were crushing the high limit games at Absolute Poker. These cheating accounts flopped over 90 percent of the time and managed win rates of nearly 500 big blinds per 100 hands. Absolute Poker support denied that these accounts were cheating, despite the mountain of evidence.
After hearing this, CrazyMarco went back into the spreadsheet that he received from Absolute Poker and discovered that it was a list of all hole cards held by every player during the tournament. This information was later placed into a hand replayer and uploaded into a You Tube video. Anyone with the slightest poker aptitude could see that Potripper had knowledge of all hole cards.
Absolute Poker continued to lie about the cheating, referred to as superusers by the online poker community. The cheating accounts were later tied to Scott Tom, one of the Absolute Poker founders. He had used a testing account known as User 363 to see player hole cards. There is evidence that this cheating had taken place since the site launched in 2003.
Absolute Poker finally admitted that cheating occurred, but only during a small period of time, according to their suspect investigation that few players believed. The site decided to pay only a handful of players back. At most, the site repaid $5 million. That may have only been 10% of what Scott Tom and other cheaters got away with during their years of seeing opponent’s hole cards at the table.
The site tried to clean its image after the cheating scandal. It created a bogus shell company called Blanca Games and decided to sell itself to it. There were press releases and interviews, but those in the know realized that this was nothing but a way to rebrand under a new image.
The new company claimed that Scott Tom was out and new owners would restore the site to its previous glory, whatever that was.
Black Friday Brings Absolute Poker Down
In April 2011, The U.S. Department of Justice indicted Absolute Poker and UltimateBet. Scott Tom and his brother Brent Beckley were personally indicted for their work involving Absolute Poker. The federal government seized no more than 10% of the total amount that it should have had on deposit.
Absolute Poker players had about $53 million in combined balances. The seizure should have left Absolute Poker with at least $48 million. It only had about $3 million in cash on hand.
Part of the reason so much money was missing is that Absolute Poker and UltimateBet used player deposits to repay fraud victims. It never forced Hamilton or Tom to repay the stolen funds.
The site was unable to continue doing business. It tried and acted as if everything was just fine. In October 2011, it finally turned out the lights. To this day, it still owes about $50 million to players. About half of those funds are owed to Americans.
Brent Beckley served a little over a year for his part in the Absolute Poker case. Scott Tom is still at large.