"Back Door" Cheating Scandal Rocks Online Poker

AcidAUS sends us the story of an online poker cheating ring that netted an estimated $10M for its perpetrators over almost 4 years. The article spotlights the role of an Australian player who first performed the statistical analyses that demonstrated that cheating had to be going on. "In two separate cases, Michael Josem, from Chatswood, analyzed detailed hand history data from Absolute Poker and UltimateBet and uncovered that certain player accounts won money at a rate too fast to be legitimate. His findings led to an internal investigation by the parent company that owns both sites. It found rogue employees had defrauded players over three years via a security hole that allowed the cheats to see other player's secret (or hole) cards." The (Mohawk) Kahnawake Gaming Commission, which licenses the two poker companies, has released its preliminary report. MSNBC reporting from a couple of weeks back gives deep background on the scandal.

Comments

*mucks his hand*

[Stanistani]

Not a bad deal, but I'll want to see the flop.

Re:*mucks his hand*

[D'Sphitz]

Thank god the moral police have arrived.

Re:*mucks his hand*

[gnick]

So, is this a matter of the "poor players" who deserve better, even though they don't really deserve anything better than to lose all their money, which they did?

...
The players chose to throw their money away, while the business shouldn't exist in the first place.

I think you've confused poker with roulette. Someone who is much better at poker than the people he's playing with will come out ahead in the long term, assuming that nobody's cheating. If everyone at the table is equally good/bad, the house rake will slowly drain their $$, but hopefully they all have a good time and possibly improve their game. Again, assuming that nobody's cheating - In that case their $$ will be quickly drained and the game will probably be frustrating to all involved.

Poker, although it involves some element of chance, is a game of skill - Much different than roulette/craps/slots/etc. What's with the poker-hate?

Re:*mucks his hand*

[vux984]

So why should the poker business not exist?

Online poker for real money shouldn't exist because its virtually impossible to ensure systematic cheating isn't taking place.

Re:*mucks his hand*

[a whoabot]

I might lose 25 dollars a month playing poker for 10 hours of entertainment, because I'm not that good, but still I only play 5 dollar games that aren't winner-takes all. My neighbour rents 5 movies a month for 10 hours of entertainment, spending 25 dollars. He's the good guy and I'm the bad guy why exactly?

Re:*mucks his hand*

[Anonymous Coward]

Actually the morality police is what brought us here. If online gaming was regulated to be fair and run by legit casinos who had a legal liability to create a fair and secure playing field this would be unlikely to happen and if it did there would be legal recourse. Since the morality police can't bring themselves to do that people play without the safety of regulation and a legal system and when companies harm their players through negligence our outright fraud the players are just screwed.

Re:*mucks his hand*

[Deagol]

I see what you mean. With today's movies, it's always a gamble on whether you're throwing your money away seeing them. Take The Mummy 3 -- that's twenty bucks for the family of four and two hours of a Sunday afternoon I'll never recoup. I'd probably have lost more money that day and had more fun if I'd blown that coin in Wendover on the quarter slots.

Re:*mucks his hand*

[SpiderClan]

Have you ever played poker? With the right people, poker is fun. A movie costs 10$ and lasts 1.5 hours, and may or may not be fun. I can play a 5$ poker game with friends that lasts twice that long, is more entertaining than most movies and that allows for actual interaction between people, rather than staring at a screen. I could blow 50$ or more at the bar, or I could play poker all night for 20$ and not wake up smelling of smoke and beer.

Playing poker because you think it will make you rich is probably retarded, playing at a casino is certainly reckless if you aren't an elite player, but playing poker doesn't in and of itself indicate naivety or stupidity. It's just a different form of entertainment and is reasonably priced as long as you're reasonable about it.

Re:*mucks his hand*

[Warshadow]

This is false. It can take awhile to catch it (as is seen in the AP/UB story), but statistical analysis will always show if weird things are happening. People who play seriously online use tools like Poker Tracker, Hold'em Manager, Poker Office, etc to keep track of their own play, wins/losses and whatnot.

Someone noticed something odd about the win rate of a few players. They mentioned it to someone else; who looked and found the same thing. It kept going until the evidence was so great that it couldn't be a statistical anomaly.

The real difficulty is in getting sites to admit when something shady has been going on. AP and UB denied that anything had happened for ages. Until the bad press started showing up and it became too much for them to ignore.

Re:*mucks his hand*

[daveime]

Yes, except those legal casinos with their legal liability are the same ones who will tell you "you are no longer welcome here", if you start winning too much, or card counting, or employing some other system to bend the odds in your favour.

Online casinos can't scrutinize the players in the same way, and can barely tell the difference between a real player and a bot.

I'm not saying what they did was in any way correct, but please don't compare them with the "fair, unbiased people of Las Vegas" - they both want to bleed you dry as quickly as possible.

Re:*mucks his hand*

[vux984]

This is false. It can take awhile to catch it (as is seen in the AP/UB story),...

So is it safe to play now? That's the question that needs answering. Or is there another scam going that hasn't been caught yet. You don't know.

but statistical analysis will always show if weird things are happening.

Eventually. But what good is that?

People who play seriously online use tools like Poker Tracker, Hold'em Manager, Poker Office, etc to keep track of their own play, wins/losses and whatnot.

Someone noticed something odd about the win rate of a few players. They mentioned it to someone else; who looked and found the same thing. It kept going until the evidence was so great that it couldn't be a statistical anomaly.

And 4 years later they got caught.

"A few players" should have retired their accounts, and spun up new ones every now and then.

Or after 3 years, should have just plain retired and taken their millions to another country. How sure are you this didn't happen too with other teams? Or isn't happening right now?

The real difficulty is in getting sites to admit when something shady has been going on. AP and UB denied that anything had happened for ages. Until the bad press started showing up and it became too much for them to ignore.

So not only does it take YEARS to unmask systematic cheating, but the online houses aren't cooperating to solve the issue faster. That doesn't exactly install confidence...

As I originally said, there is no way to reliably ensure cheating isn't taking place. Sure if it is taking place, one day, we'll know about it, maybe. But the smart criminals will have moved on before then... and meanwhile the new criminals will still be under the statistical radar.

Re:*mucks his hand*

[Anonymous Coward]

That's only true when you're playing games that compete against the house.

"Counting cards" occurs in Blackjack. In Blackjack, if you win, the house loses.

That's not the case in Poker - in Poker the house wins whether you win or lose. They really don't give a darn.

Re:*mucks his hand*

[uniquename72]

Online poker for real money shouldn't exist because its virtually impossible to ensure systematic cheating isn't taking place.

So what? Then people don't have to play it. Why limit what consenting adults want to do in their free time?

Hell, let's just ban the internet, since it's "virtually impossible" to keep it from being used to steal music and distribute kiddy porn.

Re:*mucks his hand*

[PopeRatzo]

So is it safe to play now?

It was never "safe" to gamble online. That's the whole point.

Gambling online is not unlike shooting heroin with dirty needles. You'll get high, but eventually something bad is going to happen.

Re:*mucks his hand*

[PopeRatzo]

let's just ban the internet

The RIAA and MPAA agree with you.

Re:*mucks his hand*

[vux984]

Why limit what consenting adults want to do in their free time?

Really? Did anyone consent to be cheated?

Hell, let's just ban the internet, since it's "virtually impossible" to keep it from being used to steal music and distribute kiddy porn.

False analogy and you know it.

Re:*mucks his hand*

[immcintosh]

You would rather have the immoral police?

Re:*mucks his hand*

[immcintosh]

Keep in mind this is poker being played here. Are there casinos where poker is played against the house? Because if it's just the visitors playing each other as is usual for the game, the house's only real concern is precisely that the games stay as perfectly "on the level" as possible.

Re:*mucks his hand*

[Canberra Bob]

Professional online players play orders of magnitude more hands than their bricks and mortar counterparts - thats why they do it. If you are better than those you play against in a casino game you get to play roughly 30 hands / hour against your opponents. If you multi-table online some players play in excess of 10 tables simultaneously at 60 hands / hour / table. Thats over 600 hands / hour online v 30 hands / hour in live play. Add in the lower rake online, no tipping etc and you can see how a good player can make far more online than in live play.

Re:*mucks his hand*

[Canberra Bob]

Professional poker players don't get 'interrogated in vegas'. The house does not lose against the players whether they win or lose, so does not care. It is quite common to have excellent players all sitting down at a table without the house batting an eyelid. Money in poker is made from other players, not the house.

Re:*mucks his hand*

[smegged]

I could play poker all night for 20$ and not wake up smelling of smoke and beer.

You're doing it wrong.

Re:*mucks his hand*

[jamstar7]

Depends on what cup size they wear.

Re:*mucks his hand*

[uniquename72]

Did anyone consent to be cheated?

They consented to play on using a format that cannot be secured. So the answer is "yes".

False analogy and you know it.

I don't know it, but thanks for setting me straight. Your incisive lack of explanation has shown me the light.

Re:*mucks his hand*

[vux984]

They consented to play on using a format that cannot be secured. So the answer is "yes".

You seem to be using 'consented' in a rather absurd manner.

By that logic, if I get mugged on the way home today its because I consented to walk home along routes that I cannot ensure are secured.

Of course, I could elect not to walk, but then I apparently consent to get carjacked because I consent to drive along routes I cannot ensure are secured...

I'm sure they accept -some- risk that cheating is possible, but they certainly don't consent to be cheated, and I would further argue that most of them have absolutely no concept of the level of risk they are taking on, and that most of them would make different choices if they actually understood the risk.

Seriously, if you think playing online amounts to consent to be cheated, then its no wonder you you thought your analogy wasn't false. Hell, by that twisted logic I perhaps it wasn't.

Let's comp the cheaters some room nights

[davidwr]

Illicit high rollers get free room and board for the next 5-10 years.

This is why

[bugeaterr]

I don't gamble.
I invest my money in the stock market.

Re:This is why

[FooAtWFU]

And, assuming you're not going to be taking it out for another 10-40 years, it's a good, safe investment vehicle indeed. Buy stock now! (and in the future, regularly, with a fixed amount monthly, and take advantage of dollar cost averaging!)

Whee.

Re:This is why

[TheRealMindChild]

Well, it's rather brutal here. Right now we are advising all our clients to put everything they've got into canned food and shotguns.

Re:This is why

[Hatta]

You kid, but the stock market is actually worse than gambling. At least when you gamble you know what your odds are.

Re:This is why

[gnick]

There is only one way to make money gambling: Make sure you are "the house". In the long run, only the house wins.

Actually, I cleaned up last time I was in Vegas. My buddies did too - We developed a 'system'.

1) Fill your pocket with nickels.
2) Find a nickel-slot, sit down, and drop a nickel in.
3) Wait for the cocktail-girl to walk by and spin the slot.
4) Tell the girl, "Why yes, I would enjoy a Heineken on the house."
5) Accept your beer and walk off to find another nickel-slot. (Alternatively sit at the same one, but that will require tipping if you want regular service.)

Maybe you get your nickel back and maybe you don't. Who cares? It's a full night of nickel-Heineken. A buck goes a LONG way.

Re:This is why

[arth1]

And, assuming you're not going to be taking it out for another 10-40 years, it's a good, safe investment vehicle indeed. Buy stock now! (and in the future, regularly, with a fixed amount monthly, and take advantage of dollar cost averaging!)

Assuming, of course, that the companies you've invested in don't fold with a negative value. From that, there's no recovery.

Also, keep in mind that the stock market depends on an influx of fresh money from the bottom. It's a legalized pyramid scheme, where those who buy new stock infuse the market with the money that established investors can cash out. Once the supply of fresh money stops, the stock value can only rise artificially. So sooner or later a stock market has to crash. It may be in ten years, or in two hundred, but any system that's based on continued growth will collapse.

In short (no pun intended), your 10-40 year investment is still a gamble. You're just trading a large risk of losing some money for a smaller risk of losing a lot of money.

Re:This is why

[spun]

My wife doubted we would get comped at the nickel slots. Not only do you get comped, the drinks are stronger than the ones you pay for at the bar! Add to this the cheap rooms and cheap food, and you've saved enough to pay for some expensive entertainment while still vacationing on a budget.

Re:This is why

[AndersOSU]

Assuming, of course, that the companies you've invested in don't fold with a negative value. From that, there's no recovery.

Don't buy individual stocks

It's a legalized pyramid scheme

The economy is not a zero sum game

10-40 year investment is still a gamble

Yes it is, but as long as in the long term production is higher in the future than it is now, your (sufficiently diversified) investment will grant returns.

Re:This is why

[Hoi Polloi]

But then you find out that all the toilets have locks on them charging $10, or even worse, they are slot machines too. "Come on cherries! I need to pee!"

Re:This is why

[DeathMagnetic]

Unless you have some system to guarantee that your opponents will lose...

Umm yeah, it's called being a more skillful player. The variance in skill level of poker players is easily large enough for a significant percentage of them to win enough to overcome the house's cut. Of course the house is always the biggest winner, and the average player will be a loser, but it's naive to say that only the house wins.

Re:This is why

[billcopc]

Amen! That's why I spend all my money on hookers and booze!

Re:This is why

[Xtifr]

That's pretty rude. Not to the casinos (I could care less about them), but to the poor, hardworking "cocktail girls". I do more-or-less the same thing when I'm in Vegas, but I make a point to tip the waitrons well. This means: they'll happily keep bringing the drinks; they'll carefully not notice how few nickels you're putting in the slots (as long as you keep up a minimal pretense); and you're still getting drinks at bargain-basement prices.

"Do what you wanna--do what you will;
Just don't mess up your neighbor's thrill--
and when you pay the bill, kindly leave a little tip
to help the next poor sucker on his one-way trip."
                    -- Frank Zappa, "The Meek Shall Inherit Nothing"

Re:This is why

[Missing_dc]

Did your wife mind the "expensive entertainment" you bought?

It is (legal after all in) Vegas/Nevada!

Re:This is why

[spun]

Prostitution is not legal in Vegas, though it is in the rest of the state. Our expensive entertainment consisted of rides, Cirque de Soleil, Madam Tussaud, video games, and more rides (none of which involved any other women, sadly)

Re:This is why

[Tawnos]

You make the same mistake that many do: the stock market is not about growth. Long-term, the value in the stock market comes from dividends paid, not growth. Else, the stock market would simply be a game of hot potato where the last person holding the stock loses.

Tech stocks often don't give dividends while they're in the growth phase, as the price is expected to increase and the profits that would otherwise be dividends are needed for funding company growth. However, these stocks must eventually produce dividends, else they have no real value.

Personally, I'm still waiting for Cisco to admit to itself it's no longer a growth-based tech company and to start paying dividends.

Re:This is why

[j79zlr]

When you retire you don't withdraw all of your assets, at least you are not supposed to. If they have been saving for 40 years, they are way, way, way up. The DOW is down 25% from its peak of last October, but still up over 40% from 10 years ago, 400% from 20 years ago and 1200% from 30 years ago. By dollar cost averaging and reinvesting dividends, you would be up pretty good. Also, by retirement age, you should be in a good mix of approximately 50% bonds which actually benefit from a bear market. The same rate of return can not be had with gold or real estate.

Re:This is why

[Anonymous Brave Guy]

The economy is not a zero sum game

Perhaps not, but it's a lot closer than the markets sometimes seem to think. There are all kinds of clever economic theories, but ultimately, there are only so many goods produced and useful services provided in the world, no matter how much money gets printed to pay for them, and the efficiency of production and service provision only increases so fast over time. As we've all been finding out rather painfully in recent weeks, economies that ignore this reality, based on funny money that is not backed by anything of any real value, are liable to collapse when someone knocks the bottom card out of the house.

For the first time ever, my investment portfolio has actually tipped over into an overall negative return recently. Several years of gains from investing in decent companies trading in useful markets with sound fundamentals, carefully avoiding madness like the dot-com bubble and the financial services industry that caused the current mess, have been wiped out in a matter of weeks. Sure, the market will recover in time, and if you're lucky enough to have a substantial sum of spare cash lying around to put in now then there are probably long-term bargains to be had. And sure, I know that objectively, given the various tax implications in my country, I am still better to be in my current position that I would have been if I had put the money in a bank and then bought in for the prices available now.

Even so, this makes it all too clear that stock market investing really is a long-term prospect: even something like a five-year plan, which is what a lot of the pros used to quote as a sensible minimum investment period, has brought little safety at all in the past 10–15 years. And how many people really have enough money that they can invest for 10+ years without wanting to spend any of it, yet still have little enough money that the return on investment matters? Maybe once you own the house and your kids are grown up, if you want to save for your retirement...?

Re:This is why

[AndersOSU]

what of it?

Are you predicting the end of economic growth? If so we've got more serious problems to worry about than the Dow.

If if and when we run against a boundary condition it's not going to matter whether you've invested in gold, stocks, or stuffed your mattress with cash.

Re:This is why

[lgw]

There are all kinds of clever economic theories, but ultimately, there are only so many goods produced and useful services provided in the world, no matter how much money gets printed to pay for them, and the efficiency of production and service provision only increases so fast over time.

This is true. However, the increase in effeciency due to technological advancement *is* the huge driver that makes investment work. That growth is significant over time (measured in inflation-adjuested money, as that's what's interesting). European economies have grown a solid 2% a year post-WWII. The American economy has grown a terriffic 4% a year. And a bit less than that 4% gets paid to bondholders, and a bit more to (common) stockholders, so the stock market is far from a zero-sum game.

Even so, this makes it all too clear that stock market investing really is a long-term prospect: even something like a five-year plan, which is what a lot of the pros used to quote as a sensible minimum investment period, has brought little safety at all in the past 10-15 years. And how many people really have enough money that they can invest for 10+ years without wanting to spend any of it, yet still have little enough money that the return on investment matters?

Yes, it's the 30-40 year time horizon that matters. Everyone can invest on that scale: just live below your means, not above them. Accumulate wealth, not debt. It's as easy (as hard) as having a little self-discipline. If you need your money back in 5 years, it should really be in (short term, non-corporate) bonds. Shorter than that and you want to stick to FDIC-insured accounts and treasuries.

Investing so that you can retire comfortably at 55 instead of starving on social security at 65 is "just" a matter of saving a significant percentage of your take-home pay every month, to an account that you won't draw from even if your 'fridge breaks and your car's in the shop, and you get laid off. That means you have to save even more to give yourself that padding. All of which is easy (for a salaried professional) if you stop trying to impress your friends and neighbors with your purchases, realize you dont need the latest tech toys, and even (gasp) realize that maybe you should be renting, not buying a house, during the collapse of the biggest housing bubble ever.

Re:This is why

[michaelhood]

After a quick visit to the dictionary, I have to admit I am rather disappointed that waitron is not a robotic cocktail waitress that I was previously unaware of.

Re:This is why

[Brickwall]

Many high tech companies regularly repurchase their shares. Those who decide to sell get their "dividend" in the form of cash receipts from the sale of stock. Cisco, for example, authorized $10 BILLION in share buybacks last year.

Re:This is why

[Eivind]

Anything is a gamble.

Putting the money in your mattress guarantees you'll lose value at the rate of inflation. (several percent a year, over 40 years you'd be lucky to have a third of the value kept...

Buying GOLD for the money risks that goldprices fall, or don't keep up with inflation.

Putting them in the BANK risks that the bank goes bankrupt (assuming you've got more cash than the guarantees cover), or that inflation and taxes will eat any gains. Or that the dollar falls so your value is reduced.

So yes. Buying stock is a gamble. If the economy as a whole is weaker in 40 years than it is today, then it's likely you'll get less value out 40 years from now than you put in today. True.

The economy has been growing steadily for the last few hundred years though. There's been setbacks, true. But none lasting even close to 40 years. 5 Years ? Hell yes. 10 ? Perhaps on a very few occasions, but extremely rare. 40 ? Not once.

Past performance is no guarantee for future performance, true. But it's as good a guess as you're going to get.

Also, you're forgetting about dividends. I've got stock that I've owned for a decade that are worth the same today as they where when I bougth them. And that still has been more profitable than bank over the same period.

Re:This is why

[joss]

> If so we've got more serious problems to worry about than the Dow.

We sure do: peak oil, global warming, asteroids, people who actually like Murder She Wrote. Now that's scary.

Re:This is why

[Imsdal]

Having a company traded doesn't add any value after the IPO.

You may want to learn more about the concept called Secondary Market Offering.

Re:This is why

[Anonymous Brave Guy]

Thinking "I'll put my money in the stock market now then in five years, I'll cash it out" is plain wrong. Gradually you need to move away from stocks into bonds.

I'm not going to get into financial advice; I suspect that we would agree a lot, but this isn't really the forum for that discussion. Regardless, the way the tax system is set up in my country, and the advice that was routinely given by numerous financial advisers until quite recently, both encouraged people to take a stocks-and-shares view even for medium-term investments, and effectively imposed significant penalties on those looking for safer or alternative investment opportunities — or just keeping their money in a bank account, for that matter.

Re:This is why

[networkconsultant]

Actually, if you follow the markets wisley: 1. you'll learn how to leverage options and futures properly. 2. you'll buy your home at the height of a recession 3. you'll never invest emotionally 4. you'll never put all your eggs in one basket. 5. you'll retire at 40 on a salary that would be akin to a small countries GDP. All investment involves risk, the inherent risk to reward ratio is what drives people to stock's, bonds, T-bills, options, futures, money markets and other commodities. Markets are cyclical, this is a bad part of the cycle when things are overvalued and we'll hit a huge correction and some banks may go bankrupt (with mitigating factors including the banks willingness to risk the fed's money). And that's fine. Oddley enough the markets are like poker, except there's 4 billion people sitting at the table and they are all jostling for position; that and every time i play hand with a prop-trader I get fleeced, they play both the table and the game.

Why do people place such a sucker bet anyway?

[elrous0]

It's hard enough to trust casinos even when they're under the scrutiny of a licensing body as serious as the Nevada Gaming Commission, much less when they're under no scrutiny at all (or under some "commission" with no actual legislative or enforcement authority). Casino gambling in general is a sucker bet (even under strict conditions the odds always favor the house), but online gaming and other unregulated gambling is ESPECIALLY so (since you haven't the slightest assurance that you're not being cheated).

I still don't understand why people do this. Are they really THAT desperate to place a bet, any bet? Might as well become a day-trader and play the stock market for your fix. It would be a lot more regulated than most online poker.

Re:Why do people place such a sucker bet anyway?

[Free the Cowards]

People do it for two reasons.

1) It's fun. When you plunk down $20 for you and your significant other to see a movie in a theater, you have no chance of ever getting that money back. But it's worth it to you for the entertainment. Same goes with gambling. You lose money but a lot of people enjoy it. I don't, personally, but many people do.

2) It's profitable. When playing poker, you don't have to beat the house, you just have to beat the other players. The house takes a portion of the winnings but if you can consistently beat the rest of the table then you come out ahead. It's not like other casino games in this respect. You're not playing against the house, you're just paying the house for the privilege of playing against other people. You can, and many people do, make a living playing poker.

Well, there are actually three types:

3) Idiots think they will win big.

But the point being, with reasons 1 and 2 it's possible to gamble without being irrational or stupid.

Re:Why do people place such a sucker bet anyway?

[venicebeach]

Casino gambling in general is a sucker bet (even under strict conditions the odds always favor the house), but online gaming and other unregulated gambling is ESPECIALLY so

This is exactly how poker differs from other casino games. Since players play against each other, the game is not biased against anyone. The house takes a cut of each pot (the rake), but skill determines who wins in the long run. For example, here in California poker is legal while other gambling games are not since it is considered a game of skill.

I do however agree with the need for regulation. I've been following this particular case from the beginning and the scary part is that nothing would have been uncovered if it weren't for the diligence of the players, who discovered the anomalies in several player's statistics, dug deeper and deeper to find the facts, and then pressed and pressed these companies to hold them accountable. Russ Hamilton, the cheater behind the scenes is a former World Series of Poker winner who was one of the founders of Ultimate Bet and seems to have set this whole scheme up from the beginning.

Re:Why do people place such a sucker bet anyway?

[Free the Cowards]

I don't understand. You answer your own question. The people who make money at it do guarantee that they play against people who are worse than them (on average), by virtue of becoming and staying good at the game.

Of course an average player can't make money at it. (Unless they have a skill for finding tables filled with really crappy players, anyway.) That's why it's not the average players who do it for a living.

Obviously the people who fall into categories 1 and 3 must put in more money than the people who fall into category 2 take out, but that no more disproves the existence of category 2 than the fact that customers put more money into a store than the workers take out disproves the existence of the workers.

Re:Why do people place such a sucker bet anyway?

[Cajun Hell]

But it's worth it to you for the entertainment. Same goes with gambling. You lose money but a lot of people enjoy it.

How can they enjoy it, when they know the trend must result in loss?

Oh, and: how dare they enjoy it?! I don't enjoy it, so they shouldn't either.

BTW, they're having sex the wrong way too. And they listen to crappy music. The "beer" they drink sucks. They run the wrong OS on their personal computer, and the wrong text editor too.

Something has to be done about these people.

Re:Why do people place such a sucker bet anyway?

[Bill, Shooter of Bul]

Casinos can be tremendously entertaining for the right type of personality

They're called addicts. I stand by my previous statement.

Re:Back door

[slicenglide]

You, the "Back Door" and "sorely" all together in one comment. The snickers just write themselves.

Use the Front Door!

[imstanny]

Backdoor? That's nothing. What if I log into a table (which seats 10 people) with 1 friend... or worse, 8 friends -- and then work as a team.

Re:Use the Front Door!

[RoverDaddy]

In theory the online casinos have ways to catch this kind of collusion. If 8 people at a table are connecting from the same IP address, that sets off alarm bells. If the same 8 accounts keep playing together at the same table day after day, even if they're all over the world, that sets off alarms. The local game clients themselves can look for signs of screen scraping applications that might be capturing the hole cards and transmitting them to other players.

All that said, I have no idea whether or not the online casinos are really successful at preventing outside collusion.

Re:Use the Front Door!

[Derek Loev]

That's called collusion and although it's used from time to time, the regulars pick up on it fast and the software recognizes it even faster. What people aren't understanding about online poker is that it's not the same as "placing a bet", it's a game based on mathematical probability. Online poker players have databases full of information on themselves and their opponent. Every single decision made is either positive expected value or negative, and after a while the better players learn to recognize what situations will yield a positive result. This story has been around for a few years and the real interesting part about it is the fact that it was an online community of poker players who ended up exposing it. This scandal has been developing for quite a while now and if anybody feels like getting the whole story go to the community where it all happened. There's real interesting reading there and I'm surprised it has gone unnoticed on Slashdot as long as it has.

Re:Use the Front Door!

[garett_spencley]

Those methods you mentioned don't seem like they'd be all that fool proof. A team can easily communicate via skype, IRC, IM or even old fashioned telephone (so you don't need to use screen scrapers). There's easy ways to get around always having the same IP (Internet cafe, Wifi, dial-up, proxies etc.) As for the same accounts playing at the same table all the time it seems like it's a matter of having a large enough team, decent record keeping to keep track of who won what and many accounts. If organized teams have ripped off Casinos in Vegas (the MIT blackjack team comes to mind) then surely online casinos get hit all the time and don't know.

Of course being someone who has never once gambled online and thinking along those lines, it wouldn't surprise me to learn that they've got all kinds of ways to counter it.

Re:Use the Front Door!

[greg1104]

If you do that often enough, the software running the site should pick up the collusion and kick you out. Quoth wikipedia on poker cheating: "online poker cardrooms keep records of every hand played, and collusion can often be detected by finding any of several detectable patterns (such as folding good hands to a small bet, as it is known that another player has a better hand)". I expect any poker site I play at is using software to check for basic cheating like that, but of course the same sort of incompetent corporate mindset that leads to regular reports of companies losing massive numbers of credit cards also applies here.

I personally keep my own stats with Poker Tracker, and it's not unusual for players who do that to report suspected cheaters to the site themselves as well. Many people carefully scrutinize every hand they lose looking for patterns like those that pop up in collusion. If Alice and Bob regularly play at the same table but never end up at a river showdown against one another, that's really suspicious.

Re:Use the Front Door!

[suggsjc]

If organized teams have ripped off Casinos in Vegas (the MIT blackjack team comes to mind) then surely online casinos get hit all the time and don't know.

You are missing the point. In poker games where players are not competing directly against the house but against other players and the house just charges a small percentage of the overall pot as a fee to play their game, they aren't actually stealing money from the house but the other players seated at the table. So, while the sites want to assure you that there are not any "back doors" they actually don't lose money directly from them, only indirectly if they end up losing aggregate business as a result of people not gambling due to mistrust.

Re:as i've said before

[mfh]

In physical poker, it's a lot easier to see when the house is cheating.

Because they are always cheating? :)

Re:as i've said before

[Xiaran]

In physical poker the house has no real motivation to cheat. Poker is a nice steady winner for a casino... they just take a cut of every pot. They are however motivated to have people gamble more money at poker thus increasing the pot.

No James deGriz

[pluther]

They played under the same accounts over and over for four years??

It's like they were begging to be caught.

In the words of the Stainless Steel Rat, "Learn to graft and walk away and live to graft another day."

Re:No James deGriz

[jandrese]

The article is very weird. First it goes and talks about how the people on the forum were able to track a single account making ridiculously good bets well outside of what chance would suggest is probable, then in the next paragraph it talks about how the perpetrators were creating hundreds of fake accounts and swapping them out constantly to avoid exactly that sort of analysis. The depressing thing is that the take away lesson from the article is: If you have a surefire way to cheat at poker, make sure you do it slowly enough to stay in the statistical noise and don't get too greedy. My suspicion is that this sort of cheating is far more rampant than the industry would like to admit, but most of the people who do it are smart enough to stay under the radar. Gambling online is an even surer way of losing your money than gambling at a casino.

Re:No James deGriz

[venicebeach]

There were not hundreds of accounts, but there were several.

Some of them were identified by anomalous statistics, but some were caught by following the money transfers among accounts. At some point a "good samaritan" from inside the company posted some transfer histories to the forum where this was being investigated, which allowed some of the dots to be connected.

'insider knowledge'

[B5_geek]

This cheat required somebody on the 'inside' to perpetrate. As with most casino table games, if you have somebody on the inside, cheating is easy.

This is how I cheated at various online poker sites. Me and two buddies would join a table, and have a VNC connection setup to view each others hands. two of us would play dummy hands based on whom had the best hand of the bunch. We cleaned out every table we played at.

Re:'insider knowledge'

[ivan256]

This is why I don't play poker online.

Doing exactly this is so easy that you have to assume at least half the table is doing it.

At least at a casino you have a chance of noticing a cheater.

Re:'insider knowledge'

[HEbGb]

That's so obvious, I'm stunned that anyone would play if this were possible. They don't have a way to prevent collusion, such as randomly assigning tables?

Re:'insider knowledge'

[mvicuna]

If you played at any of the levels where the pros inhabited you'd have been identified and banned quickly.

Most of the online pro's are using tracking software and doing analysis which would have picked up on you three. Though I hardly doubt they'd have needed it, the math involved in poker is only part of being a winning player.

2+2, where most of the collaboration is done, is the /. of the poker world. A lot of Statistical anomalies are discussed and investigated there.

Show of hands if anyone knows about the DERB thread?

Re:'insider knowledge'

[pete-classic]

Am I to understand that you just admitted to engaging in Federal wire fraud in a public forum? That's quite a gamble, sir!

-Peter

Re:'insider knowledge'

[idontgno]

The same reason wallhacking worked in FPSs: Game logic offloads opaque-object obscuration to graphics drivers and hardware.

That said, was there a 3-d online poker game which would be susceptible to wallhacking? Sounds pretty hypothetical to me.

Re:'insider knowledge'

[Karganeth]

What utter bullshit. This is online poker we're talking about. The term cleaning out tables isn't used online because players will simply bring more chips to the table (very easy to do - it can be automatic) or the player will leave and someone else will join which makes me think you're not familiar with online poker. Besides, even if you were colluding with two friends it's not possible to "clean out every table [you] played at" unless you were running like god. On top of that, you would have also been caught not only by the regs, but by the software too.

Reading your post makes me angry. There's already enough misinformation about online poker. Why lie about cheating online? Do you want attention? If it's the second case then you have succeeded thanks to the ignorance of many slashdot members of what online poker is actually like. Cheating is NOT rife. It is possible to win consistently at poker. It's possible to make a good living from online poker and many people do.

Re:'insider knowledge'

[ZERO1ZERO]

ugh pointless? Just set up a second PC for communication and 'film' the screen of the main PC. Hell, just sit in the same location as your buddy.

That's what you get in Kahnawake...

[Anonymous Coward]

For those who don't know, Kahnawake is Mohawk territory claimed by the aboriginals (aka Indians) in Canada.

The Mohawks claim to sovereignty over the land, and do not allow the provincial & national police to enter.

To avoid stirring up trouble, the Canadian government usually doesn't send police to Kahnawake, even though the Canadian government doesn't recognize the Mohawk claim to exclusive sovereignty.

Without any real police force, crime flourishes in Kahnawake. Drug smuggling, gun smuggling, people smuggling, cigarette smuggling, you name it.

Don't trust any business in Kahnawake, let alone a business attractive to crime, like gambling.

Not long ago, there was a Mohawk criminal driving at high speed (off-reserve) trying to get to the Mohawk territory before getting caught by the police chasing him. He made it on to the Mohawk territory, and the police abandoned their pursuit. Sadly, the Mohawk driver ran a stop sign and killed a Mohawk teenager.

For the people of Kahnawake, it seems that it is more important to be the victims of aboriginal criminals than to cooperate with non-aboriginal law enforcement. Sad.

Strict client/server separation was missing

[compumike]

From what I gather from the articles, they didn't actually write any code that tapped into the server... it was just getting information from the client app that was residing in memory but was not displayed to the screen.

This is just an enormous case study suggesting why strict client/server separation is essential, and that clients only get the information on a "need to know" basis.

Isn't this a fairly standard design practice? How did this happen?

--
Hey code monkey... learn electronics! Powerful microcontroller kits for the digital generation.

Re:Strict client/server separation was missing

[mapsjanhere]

Isn't this a fairly standard design practice? How did this happen?

--

The background story to all this is highly fascinating - there are a series of companies of everchanging names involved, that first wrote the software, then sold it to a gambling company, that then got taken over, and somehow always the same names show up. This backdoor was probably planted long ago for just the purpose it ended up being used.
As for "oversight", the gambling commission oversees one major operation - the online poker sites. Which also pays their bills.

The real news is finding the hacker not the hack.

[jellomizer]

Yea, Yea the found a hack and they exploited it... Big Whoop, that not news. The real news is that Online Gambling Industry is starting to use Decision Support Systems and other Business Intelligence methods for finding the cheaters...

Most companies are pathetic with incorporating Business Intelligence into their infrastructure. They collect the data and do nothing with it. Most IT people don't care about doing anything with it. It is quite sad.

superuser

[erbbysam]

o my....story time...
The phrase of the day is "superuser"
This data was given to many professional online poker players who analyzed the data in late 2007 (see 1 year ago, 10/16/07 to be exact) when they requested the data from the online site "Absolute Poker".

Instead of the site giving them the usual data which hid the opponents cards unless they had shown them during the hand, they sent all the raw data which included the opponents hole cards, and specifically every player and spectators player number. One of the spectators was player number "363" I believe which was incredibly low (one of the first ever to register on the site).

When designing the software they must have used several "superuser" accounts to make sure that it was working correctly, so they let it see all the cards on the table. Someone inside Absolute Bet discovered(or knew they entire time) that the loophole was still open and used multiple accounts to siphon hundreds of thousands if not millions of dollars off of their high stakes users. This was used also over other websites running the same backend software.

What made this so obvious, simply put, to the high stakes players was that these players were playing perfectly over thousands of hands which isn't possible unless you know all the cards on the table.

For more reading see:
http://freakonomics.blogs.nytimes.com/2007/10/17/the-absolute-poker-cheating-scandal-blown-wide-open/
or for more poker talk:
http://archives1.twoplustwo.com/showflat.php?Cat=0&Number=12523924&page=0&fpart=1&vc=1

Re:superuser

[erbbysam]

another link, better link for more 2+2 information:
http://forumserver.twoplustwo.com/29/news-views-gossip/ub-scandal-sticky-251207/
(found through the msnbc page)

Re:Back door

[lobiusmoop]

Liquor in the front,
Poker in the rear.

Surprised?

[MarkvW]

I am shocked, SHOCKED, to learn that there is cheating occurring in online poker!
Round up the usual suspects . . .

There are good cryptographic solutions

[spacedrive4000]

Ron Rivest and others have built many good systems for creating secure online poker games. It's possible to deal the cards in a way that the server can't eavesdrop. Now, of course, these can't do anything about n-1 people at the table working together through outside channels. And a good algorithm can still be defeated by bugs in the client software. But the point is that there are good algorithms out there.

Re:There are good cryptographic solutions

[peterwayner]

Indeed there are. I wrote a book on this:

Policing Online Games

It's far from the last word.

For more information:

http://www.wayner.org/books/pog/

To look up on Amazon:

http://www.amazon.com/exec/obidos/ASIN/0967584426/myhomepage0bc

Gambling is a tax on stupidity

[fiannaFailMan]

As my Dad often said, go into a bookie's and you'll see five windows for paying them but only one window for paying out.

Re:How casinos make money

[iho]

It may all be true but it's not like poker works. As many pointed out, in poker you play against the other players, not the house. The house has a fixed rake which is actually pretty low in online games.

I don't consider myself a pro player and i don't intend to make a fortune playing online poker but in the last 4 months i have been playing my $50 investment turned into $200. I can't make a living with that but it sure beats playing WoW and losing $15 per month.

The trick is to never overplay your bankroll. I didn't make $150 with one lucky gamble on a $50 game. I made it by playing about 300 games. I lost some, sometimes 2 weeks in a row but in the long run good play will net you money.

Never play money that what you can't afford to lose. It's as simple as that.

Half of these posts

[dosun88888]

seem to be from people that know absolutely nothing about poker and ultimately nothing about how the sites make their money, so let's clear up a few things.

1. It would never be in the best interests of the company to try to allow this to happen to anyone, as the cost would be too high. If players had a hint that they were being cheated they would never play there. That $10MM figure is nothing compared to what the sites generate from rake alone. The only people who could benefit would be hired contractors who wrote the code and got paid some small amount of money to do so. To them, it would be worth the risk to try to cheat somehow, and they obviously did.

2. To the few people who seem to think that they were getting information that was already on their systems from memory that was encrypted or something, well, that's false. The "special" accounts were sent information that other players do not get sent. You only get your hole cards, and it's not until a showdown where anyone but you and a random server out there know what anyone has.

I guess that's it, aside from the extreme unlikelihood that anyone would try to cheat in this manner at a small (say 30-60 or less) game. The risk/benefit doesn't add up at those stakes.

A few random points: high stakes poker can be shady at times, and collusion in the smaller games can be defended against to some extent (by either not playing, or using the style of collusion against the colluders. At times games can appear to be collusive due to excessive raising, but the majority of the time that's just strategy.

I love proverbs...

[ElboRuum]

A fool and his money are soon parted... give that fool a computer and his money will part with greater efficiency and speed.

Re:Must it crash?

[credd144az]

Correction

Profit = Total Revenues - Total Costs

Profit remains conditional.

Re:Must it crash?

[m0rph3us0]

That sounds a lot like the labor theory of value. The labor theory of value as an explanation of capitalism is the foundations of The Communist Manifesto.

EXACTLY!

[BitterAndDrunk]

That's why I only shoot up with clean needles. I'll get high, and there's No Consequences.

I SAID NO CONSEQUENCES!

Check out this post...

[suzzer99]

From *before* the Absolute Poker or Ultimate Bet scandal broke. By far the simplest explanation here is that Mark Seif (Poker pro, also site spokesman and part owner) was at least playing around with "superuser" capability.

By the way I followed this thing since it's inception at 2+2. Absolutely riveting story and investigation job. We're all just hoping it doesn't kill online poker.

http://www.internettexasholdem.com/poker-forum/at-absolute-pokeri-cant-believe-how-low-this-was-vt34808.html

"Play then started again......and I saw something that I never have before in all my on-line poker play: obvious manipulation. Every hand was a complete dissection based on whatever Mike was holding (third pair was capped by Seif if Mike was behind or bluffing, for example.) About 10 or 12 k was basically stolen in 15 minutes (over maybe 100 hands), and here's the kicker: he was so pissed and beyond rational thinking that he actually wanted Mike to know what was going on! For example, Mike had K9 on one hand and flopped a boat. Seif was first to act after the flop, and FOLDED OUT OF TURN just that time."

That just doesn't happen in poker. That you flop a full house and a tough aggressive opponent open-folds.

Cheating

[horza]

In online poker:
* the house doesn't need to cheat. The amount they make verses their costs means they don't need to
* players try and cheat via collusion, but their edge is so small it's not worth worrying about
* if you are playing cash games you will probably be fleeced by bot networks. I know people that run them, they live in tax havens and siphone off fortunes via a network of Net-teller accounts etc. Most of the bots run via valid accounts and credit cards, with the recipients that run the software 24/7 on their machines via DSL rake in 10%. The bots don't run on tournaments so that's where I play.

In real life:
* the house doesn't need to cheat. It's still a profitable business
* in a poker club or a casino the other players rarely cheat. It's such security that justifies the house rake
* in private games you have to watch for cheating. Eg thumbnail imprints on the back of cards, bent corners, etc.

Phillip.