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"Back Door" Cheating Scandal Rocks Online Poker

kdawson posted about 6 years ago | from the know-when-to-hold-'em dept.

Security 427

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.

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*mucks his hand* (3, Funny)

Stanistani (808333) | about 6 years ago | (#25208909)

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

Re:*mucks his hand* (-1, Troll)

ShieldW0lf (601553) | about 6 years ago | (#25209199)

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?

Is it a matter of the "poor businesspeople" who are fleecing suckers, getting rich and producing precisely zero value in return?

No, I think it's more a matter of these cheaters doing a public service. The players chose to throw their money away, while the business shouldn't exist in the first place.

Doesn't look like there is much hope that they will retain their freedom or their winnings, but maybe we'll all get lucky and the bastards running the casino won't get any of it back.

Re:*mucks his hand* (4, Insightful)

D'Sphitz (699604) | about 6 years ago | (#25209279)

Thank god the moral police have arrived.

Re:*mucks his hand* (1)

mparcens (76207) | about 6 years ago | (#25209283)

So why should the poker business not exist? The players that got scammed in this instance were not only the net-losers, but the net-winners, people who do not "throw their money away", as you so summarily dismissed the situation.

Re:*mucks his hand* (2, Insightful)

vux984 (928602) | about 6 years ago | (#25209601)

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* (2, Informative)

gnick (1211984) | about 6 years ago | (#25209381)

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?

Let's comp the cheaters some room nights (5, Funny)

davidwr (791652) | about 6 years ago | (#25208913)

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

This is why (5, Funny)

bugeaterr (836984) | about 6 years ago | (#25208923)

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

Re:This is why (4, Insightful)

FooAtWFU (699187) | about 6 years ago | (#25208993)

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 (2, Interesting)

arth1 (260657) | about 6 years ago | (#25209525)

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 (1)

TubeSteak (669689) | about 6 years ago | (#25209549)

And, assuming you're not going to be taking it out for another 10-40 years, it's a good, safe investment vehicle indeed.

Unless of course the market tanks right around the time you plan to retire.
Example: the year 2008

You're still gambling, just on a longer timescale.

Re:This is why (1)

savuporo (658486) | about 6 years ago | (#25209001)

Yeah, you could do worse, like go vote on an election or something.

Re:This is why (4, Funny)

TheRealMindChild (743925) | about 6 years ago | (#25209017)

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 (0)

Anonymous Coward | about 6 years ago | (#25209085)

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.

If that's not a buy signal, I don't know what is.

The best time to invest is when everyone else says, "Get out!"

Re:This is why (1)

MightyYar (622222) | about 6 years ago | (#25209163)

I thought I was the only one who remembered anything from Gremlins 2 (yes, there was a sequel).

Re:This is why (1)

megamerican (1073936) | about 6 years ago | (#25209323)

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.

That's what Barton Biggs, [bloomberg.com] former chief strategist at Morgan Stanley told everyone to do in his book earlier this year.

Jan. 30 (Bloomberg) -- Barton Biggs has some offbeat advice for the rich: Insure yourself against war and disaster by buying a remote farm or ranch and stocking it with ``seed, fertilizer, canned food, wine, medicine, clothes, etc.''

The ``etc.'' must mean guns.

Re:This is why (3, Insightful)

Hatta (162192) | about 6 years ago | (#25209049)

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 (1)

onion2k (203094) | about 6 years ago | (#25209095)

Unless people are cheating. Then you think you know the odds, but the reality is something else entirely.

Re:This is why (1)

jellomizer (103300) | about 6 years ago | (#25209121)

But your odds on average are still better with the stock market. Yea you get down periods. But in the long term you see a general upward direction. For real gambling you will find a general downward direction. The stock market people usually want you to make money. Gambling wants to take your money. You are gambling if you are going for short term trading. But for long term your odds are quite good especially if you diversify across different areas. So any one area could die and you are still going strong.

Re:This is why (1)

jandrese (485) | about 6 years ago | (#25209201)

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

Re:This is why (5, Interesting)

gnick (1211984) | about 6 years ago | (#25209465)

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 (1)

swb (14022) | about 6 years ago | (#25209539)

My Vegas experience isn't extensive, but in a long weekend of staying at the Bellagio I didn't get a single comped drink, and I spent a lot of time at the slots (I only lost $20 all weekend). At the Hilton, I did get a couple of comped drinks (Absolute & Tonic!) but that was over another long weekend of fairly extensive slot play, too.

I sometimes wonder if comped drinks weren't for people doing real wagering at the tables or perhaps something from the 80s and earlier.

Re:This is why (4, Interesting)

spun (1352) | about 6 years ago | (#25209643)

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 (1)

Mr2001 (90979) | about 6 years ago | (#25209493)

That's true in games where you play against the house, but not in poker.

Re:This is why (1)

jandrese (485) | about 6 years ago | (#25209583)

In Poker all players put X amount of money in, and in the end leave with X - Y money, where Y is the cut. Unless you have some system to guarantee that your opponents will lose, only the house wins in the end.

Re:This is why (1)

pbhj (607776) | about 6 years ago | (#25209231)

But for long term your odds are quite good especially if you diversify across different areas. So any one area could die and you are still going strong.

So if you have lots of money (to diversify) and won't need it at a particular time long term investments work. If you have a small pot and may need the money at a particular time (eg when you retire) then you're screwed and you may as well enjoy some poker, smoke big cigars and hope to die young.

Re:This is why (1)

Free the Cowards (1280296) | about 6 years ago | (#25209251)

That's kind of ridiculous. This latest spill is being touted as the End of the World, and yet the Dow Jones index fell a massive 7%. When was the last time you went to a casino, played all night, and lost only seven percent of your money?

And yes, the longer-term decline has been quite a bit more but it still doesn't come anywhere close to the losses you can easily rack up in mere hours of gambling.

Re:This is why (1)

jandrese (485) | about 6 years ago | (#25209423)

I'd be pretty pissed if my bank was taking my mortgage out to Vegas and losing it.

The end of the world isn't until next year (0, Troll)

davidwr (791652) | about 6 years ago | (#25209519)

We can all thank the liquid helium leak for an extra 6 months of life on this planet. :)

Re:This is why (1)

ConceptJunkie (24823) | about 6 years ago | (#25209435)

This article would seem to contradict you... frankly, any way you go at it you're likely to be cheated.

If we ask nicely, maybe Congress will bail out all the losers in Las Vegas from the past few years as well. I mean it's not their fault if they placed bad bets... is it?

Re:This is why (1)

merreborn (853723) | about 6 years ago | (#25209439)

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

I always get a kick out of the slots that advertise their payout rate. "98.7% payout! Loosest slots in town!".

Really? The sign clearly states you'll get less money out than you put in, and people find that encouraging?

In regard to your point, at least with the stock market, you can make rational, informed decisions. For example, you can choose not to invest in companies that are heavily invested in junk mortgages.

Re:This is why (0)

Anonymous Coward | about 6 years ago | (#25209479)

That should be okay. Better than gambling on real estate.

Re:This is why (1)

a whoabot (706122) | about 6 years ago | (#25209491)

Investing your money in stocks is a gamble -- stocks could go down. Keeping your money at home is a gamble -- could be stolen or there could be hyperinflation. Keeping your in the bank is a gamble -- bank could go bankrupt or there could be hyper-inflation. Trading your money for gold is a gamble -- price of gold could collapse with the opening of giant mines or some other reason. Et cetera.

It's impossible to not gamble when you have money.

Gambling fair? (0)

Anonymous Coward | about 6 years ago | (#25208937)

Don't bet on it. ;)

Why do people place such a sucker bet anyway? (4, Insightful)

elrous0 (869638) | about 6 years ago | (#25208939)

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? (5, Insightful)

Free the Cowards (1280296) | about 6 years ago | (#25209301)

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? (1)

jandrese (485) | about 6 years ago | (#25209489)

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.

This aspect always confuses me. All players together put X amount of money in, and get X - Y amount back out in the end (albeit concentrated on only a few players). Unless you can guarentee that you're going to play against people who are worse than you (I guess the game works on a "sucker born every minute" policy?) then in the end you can't make money over the long term.

Re:Why do people place such a sucker bet anyway? (3, Insightful)

Free the Cowards (1280296) | about 6 years ago | (#25209593)

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? (1)

Unending (1164935) | about 6 years ago | (#25209637)

This right here is why I don't like the stock market either.
Not that it is impossible to make money at either, but if you do so you do it at the expense of others without them getting anything in return.

Re:Why do people place such a sucker bet anyway? (2, Informative)

venicebeach (702856) | about 6 years ago | (#25209335)

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? (1)

camperdave (969942) | about 6 years ago | (#25209625)

I came across a tidbit the other day, saying that craps was also a game of skill. A good craps player can get the dice to roll certain numbers through lots of practice, in much the same way that a good bowler can nail a 7-10 split, or a good darts player can hit the treble 20.

Re:Why do people place such a sucker bet anyway? (1)

spacedrive4000 (1375597) | about 6 years ago | (#25209447)

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.

Hah. If only that were true. Despite the hard work of the endless Sarbanes-Oxley regulations, it's hard to be sure where the money is coming from and where it's going. And even when we are sure, the market can just up and change its mind.

Consider Apple computer. It's a great company that makes great computers. I can't think of a more stable solution. (That's not saying it is stable, I just can't think of a one with a better franchise.) I don't think its prospects changed over the last week. But boy does the stock market disagree.

How casinos make money (1)

davidwr (791652) | about 6 years ago | (#25209457)

Casinos make money on the large number of bets.

On any given bet, there's a pretty good chance, maybe 49.5% on a "good for the gambler" bet, that they'll lose.

However, on 1,000 same-sized bets, the odds are very small that they'll lose overall. On a million same-sized bets, it's practically certain they'll make close to the "expected return." On a bet that keeps only 1% for the house, 99 times out of a hundred that's still a million bucks for every 10,000,000 $1 bets, give or take a few thousand. 99.999+ times out of a hundred, it's still at least breaking even for the house.

By the way, I made these numbers up. The actual numbers are probably pretty close.

Re:Why do people place such a sucker bet anyway? (1)

greg1104 (461138) | about 6 years ago | (#25209469)

You need $25K in order to open a day trading account. I started playing on-line poker with $10 a friend transferred to my account. Playing poker against people from all around the world is really entertaining. Even back when I lost money doing it, the penny tables didn't cost me that much per hour while I was learning relative to things that were equally entertaining.

Playing Texas Hold'Em on-line is not a strict sucker bet, since the other players are certainly not optimal, particularly in no-limit play. While the house is unquestionably the big winner, if you're a good player you'll win on average against people who aren't, and therefore run a steady profit. I've made enough money playing at UltimateBet to withdraw the original $100 stake I put in to play after doubling it, and now play only with the profit there. Small change, sure, but now it's entertainment for me with a consistent rate of return.

It's a fun outlet, and there are actual lessons you can learn there that apply to the real world. For example, I have more than once lost a hand where I was more than a 900:1 favorite after pushing all-in after the flop--there were only two cards left in the deck that could be dealt to my opponent for them to win, and they got them both. That's not the play being rigged, that's sheer statistics. Play several thousand hands, and you discover that things that happen only very infrequently nonetheless still do happen. That really gives you a gut feeling for gambler's risk of ruin that you don't get any other way. If everyone operating in the financial markets had such experience there wouldn't be so many companies in the middle of meltdown right now after taking on excessively leveraged risk.

Re:Why do people place such a sucker bet anyway? (1)

spacedrive4000 (1375597) | about 6 years ago | (#25209537)

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.

Here's another point: the stock market isn't zero sum. At the end of the night of poker, the sum of all the money at the table is the same as the sum when it all began. It was just shuffled around. At a casino, the dealer snarfs a few chips from every hand as a rake, one of the big reasons I just don't play at a casino.

A stock market isn't zero sum and that opens up many possibilities and many risks. Let's say someone sells 1 million shares for a dollar at an IPO. Then the company does something really brilliant making the shares worth $1000 a piece. The money at the table went from 1 million to 1 billion thanks to the hard work of the people at the company.

Of course this can also go in the other direction as we've seen lately. But I think gambling on the stock market is much more interesting because of this fact. It's not mano-a-mano grubbing to beat out the person next to you. It's a collaborative effort to improve the world. I would be overstating it to say that everyone can win in the stock market, but there's something to the idea. :-)

Back door (1)

RemoWilliams84 (1348761) | about 6 years ago | (#25208949)

I thought this was gonna have something to do with anal sex. I was "sorely" disappointed.

Re:Back door (2, Funny)

slicenglide (735363) | about 6 years ago | (#25208973)

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

Re:Back door (4, Funny)

lobiusmoop (305328) | about 6 years ago | (#25209287)

Liquor in the front,
Poker in the rear.

as i've said before (1)

Surt (22457) | about 6 years ago | (#25208955)

You have to be crazy to trust the house in online poker. In physical poker, it's a lot easier to see when the house is cheating.

Re:as i've said before (1)

pushing-robot (1037830) | about 6 years ago | (#25208981)

Really? [wikipedia.org]

Re:as i've said before (3, Funny)

mfh (56) | about 6 years ago | (#25209021)

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 (1)

bill_mcgonigle (4333) | about 6 years ago | (#25209315)

Because they are always cheating? :)

Las Vegas is a tax on those who though skipping the probability elective in high school was a good way to avoid extra homework.

Re:as i've said before (2, Insightful)

Xiaran (836924) | about 6 years ago | (#25209031)

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.

Re:as i've said before (1)

Propaganda13 (312548) | about 6 years ago | (#25209037)

The problem is that you can't tell what the other players are doing. Are they sitting in the same room, using a chat program, talking on the phone? I know the companies have been going after programs where random strangers see each other's cards and it computes odds based on that, but unless table spots are random you can't control what people do.

Re:as i've said before (1)

metallic (469828) | about 6 years ago | (#25209343)

You don't play against the house in poker, you play against the other players sitting at the table. In exchange for providing a table and a dealer, the casino takes a percentage of each pot (each winning hand). Therefore, it's in their best interest to run an honest game.

Use the Front Door! (3, Interesting)

imstanny (722685) | about 6 years ago | (#25208975)

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! (4, Informative)

RoverDaddy (869116) | about 6 years ago | (#25209137)

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! (1)

pete-classic (75983) | about 6 years ago | (#25209339)

I have never played a hand of online poker in my life.

I think you have an idea how online poker cheating is done, but the world is simply too big and too complicated a place for your preventative measures to work. (And cheating is too lucrative.)

The only news in this story is that it was the casino employees cheating (presumably) honest players. As opposed to players cheating each other.

-Peter

Re:Use the Front Door! (1)

venicebeach (702856) | about 6 years ago | (#25209369)

Also, most of the sites supposedly have their software written so that they can always look back after the fact and examine the hand histories for collusion, but no one can access the hole cards while a hand is live.

Re:Use the Front Door! (2, Interesting)

garett_spencley (193892) | about 6 years ago | (#25209461)

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! (1)

Thelasko (1196535) | about 6 years ago | (#25209337)

What if I log into a table (which seats 10 people) with 1 friend... or worse, 8 friends -- and then work as a team.

That would also make an effective money laundering operation.

Re:Use the Front Door! (4, Insightful)

Derek Loev (1050412) | about 6 years ago | (#25209437)

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 [twoplustwo.com] . 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! (1)

megamerican (1073936) | about 6 years ago | (#25209543)

My brother and a few friends have done something similar at card clubs. They had a rather simple system of signals to let each other know what hand you had or were drawing for (i.e. "i have top pair" or "i'm drawing for a straight"). It involved holding your chip(s) in a certain fashion. It was a simple way to make sure that they weren't taking each others money.

No James deGriz (3, Insightful)

pluther (647209) | about 6 years ago | (#25209033)

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 (2, Insightful)

jandrese (485) | about 6 years ago | (#25209303)

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 (2, Informative)

venicebeach (702856) | about 6 years ago | (#25209425)

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' (5, Interesting)

B5_geek (638928) | about 6 years ago | (#25209035)

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' (2, Insightful)

ivan256 (17499) | about 6 years ago | (#25209183)

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' (3, Insightful)

HEbGb (6544) | about 6 years ago | (#25209211)

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' (1, Funny)

mikael (484) | about 6 years ago | (#25209571)

That might not help. If the game were an online 3D Poker game, it would be possible to modify the transparency of the different textures so that the face down cards could become visible (just disable backface culling and make the texture of the back of the card transparent).

Re:'insider knowledge' (5, Insightful)

mvicuna (30133) | about 6 years ago | (#25209217)

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' (1)

Hokie06 (986634) | about 6 years ago | (#25209289)

Yeah that is precisely why I never played online poker for really money. Way too easy for a group players to cheat.

Hell get a couple seperate internet connections running to different computers and you don't even need a group people. Just a few low end computers next to each other.

Re:'insider knowledge' (3, Interesting)

pete-classic (75983) | about 6 years ago | (#25209417)

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' (0)

Anonymous Coward | about 6 years ago | (#25209635)

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.

I actually have a really hard time believing that you "cleaned out every table you played on". On the surface level collusion seems foolproof, but to anyone who seriously knows poker, they realize when people collude they will run into several situations were you will end up loosing twice as more than if you werent colluding and also when people catch on that two people are colluding they will exploit you.

Also if you actually cleaned up you wouldnt be here you would be playing 24/7 and making billions.

This just in... (1)

rehtonAesoohC (954490) | about 6 years ago | (#25209051)

I'm amazed that people are surprised that an online gambling site has something fraudulent about it...

Maybe I'm being archaic here, but plain 'ol gambling seems sketchy enough as it is. When you take that online and you aren't even rolling real dice or shuffling real cards, can you really expect to have fair and truly random experiences?

Now I think the people who perpetrated this scam are scum, but it really seems to me that the players who got ripped off shouldn't have been gambling online in the first place.

your signature Re:This just in... (1)

damn_registrars (1103043) | about 6 years ago | (#25209129)

Play WAR? [warct.com]

Was a little ambiguous when talking about card games. Though I'm not sure that playing war (the card game) would really be worthwhile online from a gambler's perspective...

Re:your signature Re:This just in... (1)

rehtonAesoohC (954490) | about 6 years ago | (#25209441)

Well it's a little bit better than saying "Play Warhammer Online: Age of Reckoning?"

=P

Re:This just in... (0)

Anonymous Coward | about 6 years ago | (#25209213)

I'm flabbergasted that you are amazed that people are surprised.

That's what you get in Kahnawake... (5, Interesting)

Anonymous Coward | about 6 years ago | (#25209065)

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.

Re:That's what you get in Kahnawake... (1, Interesting)

Anonymous Coward | about 6 years ago | (#25209585)

many american indian reservations are about the same. i know because i grew up on one.

Shocker (0)

Anonymous Coward | about 6 years ago | (#25209075)

If you've ever played UB, you'd not be the least bit surprised.

Well, now they've gone and done it (1)

Alzheimers (467217) | about 6 years ago | (#25209103)

Now that these online gambling sites have been proven as havens for cheaters, our innocence has been broken and our trust that anonymous strangers on the internet would play games of chance for money in a purely ethical and fair manner has been shattered.

For shame!

Strict client/server separation was missing (4, Insightful)

compumike (454538) | about 6 years ago | (#25209119)

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. [nerdkits.com]

Re:Strict client/server separation was missing (1)

FranTaylor (164577) | about 6 years ago | (#25209253)

Ha ha ha if you think the online poker folks are going to release their source code so that we can see if these steps are being taken.

Re:Strict client/server separation was missing (3, Interesting)

mapsjanhere (1130359) | about 6 years ago | (#25209277)

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.

Re:Strict client/server separation was missing (1)

jandrese (485) | about 6 years ago | (#25209389)

There are two possibilities:
1. It was set up like that on purpose because the programmer wanted to write a version of the app that let him cheat.
2. Plain old incompetence.

I don't know which one this is, but I wouldn't be surprised if it was the second. The other thing I wouldn't be surprised about is if the link wasn't encrypted, or had a flaw in the encryption, that allowed someone with a packet sniffer near the server to watch each hand as it went out.

simple rule: (1)

circletimessquare (444983) | about 6 years ago | (#25209139)

there is no technological security fix made by a man that cannot also be broken by a man

all you need is enough incentive

given that realization, and the boundless financial incentive implicit in onliner poker played for real money, it should rapidly dawn on you that there is no such thing as an online poker game played for money that cannot be fixed, and probably is fixed, if you are pumping real money into it

playing online poker is really foolish. its an arms race between exploitation and security, and the incentives are just way too high to exploit

A fool and his money... (1)

wcrowe (94389) | about 6 years ago | (#25209155)

This illustrates why online gambling is so @#$%ing stupid. How can you possibly be sure the game is honest?

The real news is finding the hacker not the hack. (2, Interesting)

jellomizer (103300) | about 6 years ago | (#25209223)

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 (5, Informative)

erbbysam (964606) | about 6 years ago | (#25209233)

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/ [nytimes.com]
or for more poker talk:
http://archives1.twoplustwo.com/showflat.php?Cat=0&Number=12523924&page=0&fpart=1&vc=1 [twoplustwo.com]

Wow. (1)

Spy der Mann (805235) | about 6 years ago | (#25209305)

This actually surprises me. I thought cheating for the House was 100% LEGAL. Turns out it's not.

In any case, my trust in gambling sites isn't any greater than my trust in Diebold voting machines.

Surprised? (3, Funny)

MarkvW (1037596) | about 6 years ago | (#25209349)

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

There are good cryptographic solutions (3, Insightful)

spacedrive4000 (1375597) | about 6 years ago | (#25209355)

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.

mod]9 up (-1, Troll)

Anonymous Coward | about 6 years ago | (#25209403)

not so 3ad. To the My efforts were

Rogues (1)

PMuse (320639) | about 6 years ago | (#25209475)

If you ask me, the rate at which the unethical/criminal behavior of the month is being perpetrated only by "rogue" employees without management's knowledge is somewhat too high to be believed.

And this is why online gambling should be legal (0, Flamebait)

Zerth (26112) | about 6 years ago | (#25209499)

If it was legal, you'd only play onshore, where you could rely on it being inspected and audited much like slot machines.

The only people who would play unknown offshore games are cheaters, idiots, money launderers, and those trying to avoid taxes. And only the cheaters and the house(who are probably either the cheaters or the money launderers) would win, draining the money from idiots and tax-dodgers.

Sounds good to me.

Good Thought. (1)

mevets (322601) | about 6 years ago | (#25209619)

Maybe Wall street should run it.

Gambling is a tax on stupidity (2, Insightful)

fiannaFailMan (702447) | about 6 years ago | (#25209529)

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.

Like anyone cares (0)

Anonymous Coward | about 6 years ago | (#25209663)

gamblers are already defective.

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