How Online Gamblers Unmasked Cheaters

60 Minutes/Washington Post Joint Investigation Questions Honesty, Security Of Gambling Sites

(CBS)  This story was first published on Nov. 30, 2008. It was updated on June 25, 2009.

In the wild, wild west, when a poker player was caught cheating it was a capital offense, with the punishment quickly dispensed right across the card table. But today if you're caught cheating in the popular and lucrative world of Internet poker, you may get away scot-free.

At least that's what seems to be happening in the biggest scandal in the history of online gambling.

As 60 Minutes correspondent Steve Kroft first reported last November, a small group of people managed to cheat players out of more than $20 million.

And it would have gone undetected if it hadn't been for the players themselves, who used the Internet to root out the corruption. As a joint investigation by 60 Minutes and The Washington Post revealed, it raises new questions about the integrity and security of the shadowy and highly profitable industry that operates outside U.S. law.

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WashingtonPost.com: Click here to learn more about online gambling.

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If you had to pick the moment that the poker boom began, it was probably the day an unknown accountant named Chris Moneymaker won $2.5 million at the 2003 World Series of Poker.

Suddenly every amateur with a hat, sunglasses and a stack of chips saw themselves as the next big money maker. Nearly 7,000 competed in last year's tournament for $180 million in prize money. But the fever has spread far beyond Las Vegas.

It is the richest sporting competition in the world. And yet all this pales in comparison to the half million people who are playing on the Internet right now in the unregulated world of online poker.

As we learned in a tutorial, all you have to do to play is log on to the Web, click your way to an online gambling site, open an account with your credit card, choose your game and pull up a seat at a virtual table.

"These people could be playing from anywhere in the world. They could be here in the United States. They could be, you know, in India. They could be in South Africa," Australian computer security expert Michael Josem tells Kroft.

We should tell you that this $18 billion industry is illegal in the U.S., but the ban is almost impossible to enforce since the Internet sites and the computers that randomly deal the cards and keep track of the bets are located offshore, beyond the jurisdiction of U.S. law enforcement.

And unlike land-based casinos, there is almost no official regulation, enforcement or supervision. But it hasn't stopped thousands of mostly young men from making this their livelihood. Todd Witteles, a former computer scientist-turned-poker pro, says you no longer have to go to Vegas to find a high stakes game.

"You could do it from your own living room," he says. "You don't have to get dressed. You don't have to anything. It's right there on your computer."

Witteles says online poker is much different - faster, more aggressive and less personal.

"You're not lookin' at somebody sittin' across the table. You're just playing the cards that tumble out of the computer," Kroft remarks.

"Not only are you not looking at your opponents, you're not looking at the cards being dealt, you're not looking at who's dealing them to you. So, you don't know if the whole thing is legitimate, even if all the players sitting with you are just as legitimate as you are. Maybe the whole game isn't," Witteles says.

And as Witteles found out, it wasn't, at least on a popular Internet site called "Absolute Poker." His suspicions were first aroused in a high stakes game of Texas Hold 'Em, against what he thought was an incompetent, and lucky, amateur using the screen name "Grey Cat."

"This Grey Cat person was new. And at first, he seemed like a live one. He seemed terrible," Witteles remembers. "He seemed to play crazy. It seemed like he was giving his money away. Except the only thing was, he wasn't losing. He was playing in a style that was sure to lose, but he was killing the game day after day."

While Witteles was losing $15,000 to the apparent novice, other high stakes players began to notice improbable and endless winning streaks on Absolute Poker's sister site, "Ultimate Bet."

David Paredes, a Harvard grad who has made enough money playing poker to pay off his law school loan and live in an expensive New York apartment, got fleeced by a player called "Nio Nio."

Asked how much he lost, Paredes tells Kroft, "I'm probably down somewhere in the range of $70,000 to that particular player."

Paredes says there were other players who lost higher sums. "In the range of $250,000, $90,000, $70,000, $210,000."

[texanranch]

I also sent emails to support and they did nothing Im heard they have cyber computer players which are programmed to take your money so they dont need to payout the monies, There is no legite regulation and hey avoid taxes. **** all thoses sites keep your money and go to a live action in person casino!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

[TheDoverPro]

A couple of online scandals in the world of Online Poker made some news recently. The scandals involved players who could see the hole cards of all the players at the table at two sites, Ultimate bet and Absolute Poker. There were able to do this for years, and stole millions from other players at those sites until they were caught. Not caught by the site operator or the certifying body, both of whom initially denied the possibility, but caught by other players who analyzed their play and got lucky when the sites provided some playing hand information that accidently was released.

For full details you can go here: Online poker cheating scandal

Just because some players were caught cheating online does not mean that it still does not happen. This one player, potripper, was incredibly dumb to play it the way he did, by winning so much it became too obvious that there was some sort of cheating going on. Had he not been so greedy and just played slightly above the average, he would most likely still be at it.

And there may be others who can do the same thing, but are smart enough to cover their tracks by smarter play, losing a few now and then, and keeping a low profile.

We see examples everyday of websites being hacked, information being stolen, sites raided and other types of Internet crime. Who is to say that this is not being done now as I write this?

I think there is a lot more cheating online than most players suspect, and collusion is the most rampant. Collusion can occur many ways:

Using an instant messenger service, such as Yahoo, MSN, AIM or others, two players, or even a group of players, can use these services to share hand information during play, from locations across the street, across the city, across the state, even across the country or in a different country. By sharing hand information during play, these players can acheive a significant advantage over the other players.

Next most common is players who use multiple accounts to play on the same site, often through different skins. This makes it possible for the same player to actually have two (or more) seats at the same table, enabing chip dumping in tournaments, whipsawing fo build pots, and

After that comes two accounts from the same IP using two different computers under different names (think husband/wife teams) who can play in the same game, even at the same table.

There will be no final answers until online Poker is regulated legally in the USA. The Poker Players Alliance is trying to do this, for more information, visit their site and join up, it's free!

[Wookiee-1138]

They should feel lucky it wasn't the /b/tards who got their IP data. Then they'd wish they'd never been born.

[MisterEC]

As well as this type of cheating, it is possible to play with two, or more people who IM each other while in the same game! If you gamble on line you risk being cheated on many more ways then one.

[dreamline78]

Ah, this story again. I remember posting comments last fall when it broke. MisterEC, do you think we're idiots? Of course we know people can cheat by IM'ing their hole cards to each other. This is also the easiest form of cheating to detect. If the players themselves don't catch it, eventually the site will. When two players cheat like this on a regular basis, they have to spend a lot of time at the same table. Anytime the site notices a history of two players playing all the time at the same tables, red flags go up and these players are watched closely. When it's found that they have been cheating, their accounts are closed, monies are confiscated, and then any players who were cheated are compensated.

[lisaalan]

Who cares? These people are cheating themselves! This is an illegal activity. Perhaps these smart guys could spend time trying to improve the legal systems in the U.S. rather than working outside it to profit with no payment of taxes. I really can't believe 60 Minutes even spends time dealing with this when there are really important and legal issues waiting their attention! I hope they all lose their shirts.

[dreamline78]

Lisaalan, kindly refer me to the federal law that makes online poker illegal. I'll save you some trouble: You won't find it because it doesn't exist. There are 11 states that have laws outlawing Internet gambling. These are bills that got drafted up in the State Congresses, voted on, and signed into law. Why would they need to do that if the federal government already makes it illegal?

[brian9194x]

Nobody believes your slander and ridiculous claims. At least anyone with half a brain. Your statements "THIS IS NOT AND NEVER WILL BE POKER" give it all away. Pretty weak if you ask me.

An employee hacked you haha. Yeah and Phil Ivey tried to hack my account and steal my bankroll because he needed it. Trust me, if what you say is true, you would have no problem proving it. Everyone at twoplustwo forum would help you. No question.

It really amazes me at the lengths people will go to in this country. I know there is corruption but on this level, a card game, is amusing. The NFL should be ashamed of themselves and people like you should be ashamed of yourself. Everything you and others claim is contradicted by the exemption of online fantasy fball, horse betting, and lottery. This isn''t even about online poker, its about constitutional rights and corruption. Also everything you claim even though its false would be fixed by regulation. The point is that you just want online poker gone. That''s fishy to anyone with a brain.

Point proven.

[brian9194x]

here is a pretty good article about poker bots.

http://www.pocketfives.com/poker-articles/See-Your-Opponents-Hole-Cards--Guaranteed-2426045

[brian9194x]

"As much as you reply to what i type on here i now know..."

-its my passion for the game steel. i imagine its probably the same game you love. whether live players want to believe or not, its to their benifit that online poker stays around and is not smeared. "the poker boom" was started because of online poker. NL was almost a myth before online had their way with it. Without online poker, live games die too all you live players. people will lose interest and wont be so eager to try their skills at the live table they have been brushing up online.

It''s hard to knock someone down who has passion like i do and there are a lot of us.

[brian9194x]

i would be an unsuccessful player live and online like you steel if i hadn''t spent countless hours reading books on LIVE poker, watching video''s and reading forums about strategy!

and like i said, we need regulation. its funny how us online players are begging the gov to tax and regulate us!

what about online fantasy football, online horse betting, online lottery??? tell me that steel???

if you remember, online and land casino''s take RAKE. They do not make money on the outcome of a poker hand. if they are caught cheating, they lose BILLIONS! It is not in the sites interest to cheat! absolute was a F **** and should be shut down imo. they are the exception. and considering its 1 deal, thats pretty *** good considering all the online poker rooms. im sure more scams have been caught in live poker than online poker. thats most likely a fact.

[brian9194x]

oh hey steel, you know how i learned how to play online poker??

I read books on playing LIVE poker! and you know what?? the same techniques and strategies applied!!

wow what a shock.

[brian9194x]

oh and by the way, its much easier to spot a card mechanic in online poker than it is live. lets think about where the words "card mechanic" came from?? live poker. yep there is cheating in live poker!! wow im sure that''s no surprise to anyone and i dont see anyone trying to shut live poker down even though there are ILLEGAL poker rooms all over the usa.

[brian9194x]

and lets not forget about what the real debate is. regulating online poker!!! funny how you are so against it. gee could you have a special interest in making sure online poker is illegal?? my only interest is the fact that when i get off of work, i would like to play poker. i cant drive to a casino because there aren''t any where i live. my only option is playing in an illegal poker room that has just about 0 safety whether it be from the law or for my health. quit trying to determine what i do in MY TIME. i have never told you not to play live poker and nobody is forcing you to play online. that is your preference SIR.

[brian9194x]

haha its funny how just because i am stating whats right and FACT i must be affiliated with the sites. thats funny. guess everyone else who has stated facts on here is also a site employee. sorry bud, thats just not the case. if it was why would i claim two sites who compete over players are both legit?

why do highstakes players risk millions on them? where is your proof? go ask your boy phil ivey. he plays on tilt and has a stake in the company. would he risk his face on a cheating site?? dont think so!

if its not poker, please sit down and play me. i will take your money whether it be live or online because its the same game. like ive said before, its common for human beings to claim what you claim when they dont understand it. thats just human nature. im sure the stock market is rigged too! pshhh

nothing you say is valid.

you are entitled to believe what you want. shoot, go chase after the loch ness monster for all i care. anyway, the sites need to be regulated like they are in europe. oh i guess those sites are scams too even though they are publicly traded and regulated by more than one entity.

if online poker is rigged than so is live poker.

[brian9194x]

haha I do get a kick out of this. Please cbs investigate poker bots and let%u2019s explore the truth about online poker and how shady this most recent legislation is. . You will find it%u2019s pretty much a non issue. Everyone knows bots are a joke and don''t work very well.

And put my money on etrade? Are you telling me there aren%u2019t any scams in the stock market? I''m probably more susceptible to scams on eBay and the stock market than I am with online poker. And that just a couple examples.

And sir, we are trying our best to have online poker regulated so individuals like you and me will be safer from crooks. Unfortunately I could go to the store and get robbed by a crook or buy something on Amazon and get robbed by a crook. My point is there are scumbags everywhere.

[brian9194x]

Convincing you and anyone to play online poker steel, is not and never will be my objective. I just want to provide individuals who would like to play online poker with the correct information and let them know that if is safe and it is LEGAL. There are two very reputable sites poker stars and full tilt poker. stars being more for tournaments and tilt more for cash games. They both ofcourse have either or. I am 100% positive that there are plenty of others but those seem to be the two mainstream in the United States. I have played hundreds of thousands of hands the past 4-5 years and have never had a problem and I speak for the majority of online players.

[brian9194x]

and to further add steel, those are personal preferences that you spoke of, those are not mine and not a reason to shut down an 18 billion dollar industry that for the majority is very legit and very legal. You have the freedom to play live just as I have the freedom to play online.

[brian9194x]

Let me remind you that cheating exists in just about anything that involves money or competition. And there are far more scams online than just online poker. Funny how they reported on an incident that took place over a year ago and when the poker community tried to have the news media involved they ignored us. And as far as regulation, we see what happened with the mortgage industry not being regulated, it''s just common sense to regulate online poker.

Hate to break it to you steel, but online poker will never go away whether its legal or illegal. Online poker is legal by the way. It is far too big of business and convenient for people to play the game they love. You sick to your live game and I will stick to my online game and play live when I can take a trip to Vegas.

[brian9194x]

As is Helmuth''s mouth! None of this can be duplicated in the online game so

--there is a chat box that is very lively and if you want the "live trash talking experience" than you have the choice to play live. If I want to play online then you should not worry about that. not all of us are able to go to a casino after work for a few hours.

IT IS NOT POKER FOOLS!!!!

--that''s funny, I played online my entire career. played a live tourney and won 2 live tourneys in the same night. talking 90-150 player field. don''t tell me online poker isn''t real. I would take you down live or online.

BTW I have never lost 1 cent of my money online!!! And never will! BAN THIS TRASH FOR GOOD OF THE GAME!!!!!!!!

--you have the option of playing live or online. you decide. but sir, you will not decide for me.

[brian9194x]

steelcurtin you obviously are a live player who is mad at the impact of online poker. let me break it down for you.

So i guess this whole potripper story is just a figment of cbs and a few others imagination!!

-nobody said that. it is an isolated incident that affects a small minority of players because the majority of players don''t play on that site.

Tells are not a big part of the game??? Play Phil Ivey in a hand or 2 and say that. His eyes are the biggest part of his game!!!!

--if this is true than why is Phil Ivey still a huge winner online? why has he grossed almost 9 mil since 2007 online? physical tells are not as big of part of the game as you make it. if anything online poker is harder than live.

[brian9194x]

I highly doubt Party Poker stole your money. For one party poker is a publically traded company and very legit. I also cashed out money from party poker and had no problem. I am sure there is a reasonable explanation and probably still can get your money.

Considering Party Poker makes a ton of money on a daily basis from rake, your money would not be worth it to them to steal. I don''t know how much your cash out was but mine was for a pretty significant amount of money and I cashed out more than once.

Contact customer service again and tell them your issue. I would be willing to bet if you go about it the correct way, you will get your check.

If you stick to the mainstream sites, online poker is perfectly safe. If it wasn''t safe or rigged/etc.. then why would high stakes players risk millions on them?? They wouldn''t. Let''s ask Phil Ivey or Patrick Antonius if there is a big difference in the actual game of poker.