Paul Leggett, the Chief Operating Officer of UB.com parent company Tokwiro Enterprises, posted a blog on Monday responding to questions regarding the cheating scandal that occurred on Ultimate Bet between 2004 and 2008. Around $22.1 million was stolen from players during the scandal, resulting in a mass hysteria among the poker community. Years later, Leggett is still attempting to tackle issues on the matter.
Leggett opened his blog by clearing the names of anyone associated with Tokwiro Enterprises, the current owners of UB.com. “I wanted to start off by confirming that no individual who has been linked to any cheating works for Tokwiro or any of its subsidiaries,” stated Leggett. “None of these individuals have an ownership stake in our company or any company that we have debt obligations with.”
Excapsa Software sold its operating assets to Tokwiro in October 2006 as a way to withdraw from U.S. online gaming before the passage of the Unlawful Internet Gambling Enforcement Act. According to Leggett, Tokwiro wasn’t aware of the underlying cheating scandal that was taking place at the time.
Said Leggett, “When I took the COO position with Tokwiro, the AbsolutePoker investigation had recently finished and the UltimateBet one was just around the corner. Amongst other things, the result of the AbsolutePoker investigation required Tokwiro to demonstrate to the Gaming Commission, and their auditors, that a list of certain individuals were no longer working for the business and that they had no ownership of any kind. The list of individuals included all names that were associated with the cheating in any way or form and also anyone who was identified as hindering the investigation.”
In 2009, The Kahnawake Gaming Commission (KGC) stated that it had found convincing evidence that former World Series of Poker Main Event champion Russ Hamilton was the main person responsible for multiple cheating incidents at Ultimate Bet. Hamilton, who served as a consultant for the site, was the brainchild behind unauthorized software code that transferred hole-card information of other players, allowing him to see the cards of every opponent at the table.
While this information has been known for a long time, Leggett stressed in the blog that it was in fact Hamilton that got the ball rolling: “Some people have a hard time believing that Russ was the only person involved in the cheating. The truth is that all of the data facts pointed to him. The cheating was occurring from places where Russ lived and worked, the money was being moved through accounts he controlled himself or through people who reported directly to him or his close friends. The accounts and usernames were created/adjusted by people who worked directly for him, etc.”
“It is definitely possible that Russ had other accomplices who might have helped him with the actual cheating but we have no physical evidence of it.”
Finally, Leggett answered questions regarding the settlement between Tokwiro and Excapsa Software in November 2008. Tokwiro filed suit in September 2008, seeking $75 million for damages associated with the scandal. The two companies settled for $15 million, which was said to have covered the total amount of reimbursements made to players.
Said Leggett, “The UltimateBet business and assets were transferred to Tokwiro through a company called ‘Blast Off.’ It seems there is a lot of confusion about this but basically the Excapsa Group transferred all of the assets to Blast Off and then sold Blast Off to Tokwiro. Tokwiro is a Sole Proprietorship of Joseph Norton’s and he is the sole owner of both Tokwiro and Blast Off. When we issued a demand letter to the Excapsa Group relating to this fraud, we ended up negotiating a $15,000,000.00 USD settlement. At the time of the negotiation, we believed this number exceeded the amount of the money that was stolen from players. “
According to Leggett, Tokwiro discovered more accounts associated with the cheating scandal after the suit was filed, totaling close to $23 million. But due to the complications of the suit, the company accepted the $15 million settlement in order to pay back the losses of players on the site. Also, as part of the settlement, Hamilton’s company shares were canceled and he was no longer able to benefit.
The entire blog can be found here.