It has been brought to my attention that some of the contentions made in my recent article asking whether Gaming Commissions were beneficial were factually inaccurate as it pertains to the Absolute Poker and Ultimate Bet cheating scandals in the late 2000s. I would like to apologize to the KGC and to Grand Chief Joseph Norton (who is referenced in the article) for any problems this article may have caused. There was never any malicious intent with the article and both management at the OSGA and myself have always been very supportive of the work of the KGC and Mohawk Internet Technology and realize they provide an important and beneficial service to players and operators who run out of the Kahnawake reserve.
To provide some clarification:
In the article, I suggested that the KGC provided a disservice to players by not suspending the licenses of both companies following revelation of the scandals. Representatives from the KGC noted that doing that would have accomplished the exact opposite effect.
"If the KGC had revoked the AP/UB licences, we would have immediate lost any regulatory control over the sites (and the operators of the sites). We would therefore have been unable to demand (and receive) the data and information that was obtained during the 18 month investigation headed by Frank Catania. In short, had we revoked the licences we would never had been able to determine what happened, how it happened, which players were affected and the quantum of the losses. Moreover, revoking the licences would have jeopardized (if not destroyed) UB's efforts to obtain a settlement from the software supplier (Excapsa), the proceeds of which were used to compensate affected players over US$23,000,000.00— the largest such repayment to players in the history of gaming.
Suspending the AP/UB licences during the 18-month investigation would have had the same effect. With no ability to operate, the companies would have gone out of business very quickly—removing any incentive on their part to cooperate with our investigation and/or to compensate affected players.
It is important to note that the cheating activities on the AP and UB sites were stopped before or shortly after the date on which the KGC first became aware of them. The cheating activities did not continue during the time that the KGC's investigations were underway. During the KGC's investigations the AP/UB sites were under intense scrutiny, not only by our investigators but by the online gaming community. In fact, during this time, the AP/UB sites were probably the most closely monitored sites in the industry. Further, the sites were the subject of significant negative media attention and any player who had lost faith in the credibility of the sites was able to close his/her accounts and obtain a full refund of their funds."
The KGC also noted that they kept the licenses in effect for a year after Black Friday, although the sites stopped accepting any new customers, to facilitate discussions about a potential buy-out of AP/UB.