Ultimate Bet

2001
2011
Out of Business
Total loss
Kahnawake Gaming Commission
Insider cheating, incompetent management, misappropriation of player funds

One of the first poker rooms to launch in 2011, Ultimate Bet became one of the largest poker rooms in the world. They gained prominence early on as the online poker home of Phil Hellmuth. Site traffic grew significantly as the poker room decided to stay in the United States after the UIGEA passed in 2006. Unfortunately, the latter part of Ultimate Bet’s history was marred in controversy – first with a well-publicized cheating scandal that surfaced in 2008 and then the events of Black Friday in 2011, which sunk the company and led to a complete loss of player funds.

Screenshots

888 Poker Review
  • Large player traffic
  • Above average quality of games
  • Social, recreational player focused
You can read more in our 888 Poker Review
BetOnline Poker Review
  • Third largest U.S. facing poker room with growing traffic.
  • Excellent and consistent payment processing.
  • Relatively juicy games.
You can read more in our BetOnline Review

History of UltimateBet

UltimateBet was launched in 2001.  The poker room signed several well known professional poker players including Phil Hellmuth and Annie Duke to help promote the online poker room.  These professional players had an ownership stake in the company.  UltimateBet quickly became the fourth largest online poker room.  The poker room also had several skins in its early years.  Devil Fish Poker and Green Tie Poker were among those skins.

eWorld Holdings was the original owner of UltimateBet and was licensed by the Kahnawake Gaming Commission (KGC) when the site launched on March 1, 2001.  Exscapa owned the software but was never licensed by the KGC.  All entities were acquired by Tokwiro Enterprises in October 2006.  Jim Ryan, current CEO of Party.BWIN, was CEO of UltimateBet’s parent company through most of their pre UIGEA existence.

UltimateBet Cheating Scandal

UltimateBet, later referred to as UB.com, had a superuser cheating scandal similar to Absolute Poker.  While Absolute Poker eventually acquired them, the two cheating scandals were unrelated, although they shared many of the same characteristics.

The cheating appeared to start on or around June 2003.  The cheating continued until at least December 2007.  That is the time that high stakes players at the Two Plus Two poker forum began to realize that there was cheating at the high stakes no limit tables.

When the cheating first started at UltimateBet, the company was owned by Exscapa.  The company went public in 2006.  The company was brought private after the Unlawful Gambling Enforcement Act (UIGEA) went into effect.  The company decided to sell the company on credit to Absolute Poker in late 2006.  The company was bought by Tokwiro Enterprises, who also owned Absolute Poker as part of a later exposed shell game.  This was during the middle of the cheating at UltimateBet.

The online poker community was buzzing with mountains of proof that something shady was going on at UltimateBet.  The company refused to acknowledge the accusations even though there was ample proof in poker forums and the company appeared to have known it was going on well before players discovered the irregularities.  It appeared part of the reason that the company did nothing was because UltimateBet insiders were the actual cheaters.  Not only did they fail to do anything about the cheating, they even tried to cover it up after it was discovered.

The cheating was being facilitated by a superuser account.  Auditmonster2 was the superuser account used.  Auditmonster1 also existed but there was no proof it was ever used to cheat UltimateBet players.

Auditmonster2 would observe tables without playing the game.  The observer could see all cards dealt to players at the table.  This account would tell the cheating players all of the holdings at the table held by the other players.  The cheating players knew when to make bluffs and when to call bluffs.  The cheats also knew when to fold second place hands.  Most hands that the cheats would lose were hands that were checked down or where the cheat would get all in and get drawn out.  There were a handful of times the cheats would call a small bet and lose to try and cover their tracks.

UltimateBet Investigates Cheating

On March 6, 2008, UltimateBet finally made a public announcement stating that they were investigating the cheating claims.  This included the deletion of the most obvious cheating account, NioNio.  It is interesting to note that Absolute Poker had taken over by then.  The two poker rooms were operating separately at the time, but Absolute Poker management was heavily involved in UltimateBet.

NioNio stopped playing under that name on September 4, 2007.  That was the same week that the Absolute Poker cheating scandal was exposed.  The user of this account was able to have his username changed after that time.  This is very suspicious because this should have been flagged when the player had won over $600,000 on UltimateBet.

Further research showed that NioNio, and another cheating account Nopaddles, had their usernames changed by UltimateBet support.  Other accounts were closed or had their names changed immediately after the cheating scandal broke.  It was obvious that insiders at UltimateBet either facilitated what was going on or were the cheats themselves.  There were dozens of cheating accounts.  To this day, many of those accounts have never been named.

UltimateBet Admits Cheating

In May 2008, UltimateBet admitted that insider cheating had occurred.  The company stated that they would issue refunds to players that were cheated.  While some players did receive refunds, many players felt that they were either short changed or never paid at all when they were due money.  UltimateBet stated that $22.1 million was paid to players that were cheated over the years.

Cereus Network Launched

In June 2008, Absolute Poker and UltimateBet merged their player bases.  The Absolute Poker software was used for the new network.  Their software would keep the look and feel of the previous UB software but it was really just a skin of Absolute Poker with a different color scheme and logo.  The UltimateBet software was no longer used at UB.

Cheating Scandal Helped Sink Poker Room

It was eventually discovered that the money that was paid out to victims came out of player’s deposits.  This money would end up lost when Absolute Poker and UltimateBet had most of their assets seized by the U.S. Government on April 15, 2011, a date referred to as Black Friday in the online poker community.  Before the government seized an estimated $10 million on Black Friday, the company only had about $15 million in cash to cover about $54 million in player deposits.

On September 29, 2008 KGC distributed a press release.  The release implicated Russ Hamilton as the cheater.  The KGC stated that UltimateBet would refund all players that were cheated.  It was estimated that $22.1 million had been stolen from players.  KGC also noted that the proper law enforcement authorities had been notified.  A fine of $1.5 million was also levied against the company.

A total of 23 accounts used 117 different usernames during that time.  A total of 31 people associated with eWorld Holdings were potentially involved but were never named.

Victims Sue UltimateBet

Eight superuser victims filed suit against UltimateBet in an attempt to recover stolen funds in January 2011.  The plaintiffs were Daniel Ashman, Brad Booth, Thomas Koral, Greg Laverly, Dave Lizmi, Daniel Smith, Joseph Sanders, and Dustin Woolf.  The plaintiffs alleged that they were owed $1.7 million in funds stolen from them during the years of cheating.  The lawsuit went nowhere as Black Friday exposed UltimateBet’s lack of liquidity that left them unable to pay even if a judgment could have been secured.

ClubWPT Using Cheating UB Software

ClubWPT is a subscription based U.S. online poker company.  The World Poker Tour licenses its name to be used for the website.  ClubWPT is legal in most U.S. states through sweepstakes laws.  Players have the option of paying $20 a month for a VIP membership or mailing a postcard to ClubWPT each month for a free basic membership.  The software used at ClubWPT is the same platform that hosted the years of UltimateBet cheating.

Shell Games

Tokwiro Enterprises reportedly sold the company to Blanca Games in August 2010.  Blanca Games was essentially an empty shell.  It was discovered later that this move was done to shield the company from a lawsuit filed by the former owners of UltimateBet.  The owners claimed that Tokwiro Enterprises had not paid their loans due from the sale of UltimateBet to Absolute Poker’s parent company.  It was also later discovered that the company was also trying to hide from its preferred shareholders.  The group, known as Madeira Fjord, held notes totaling $250 million.  Madeira Fjord shareholders were owed 12% interest a year on this note.  Most or all of that was never paid.

Avoid KGC Sites

This is another example of why players should avoid playing on KGC sites.  This is one of several failed online poker rooms that were licensed by KGC.  This was also not the first time an insider cheating scandal surfaced where insiders stole millions of dollars from players under the watch of KGC.

Players should also avoid playing at ClubWPT.  The software is considered to be vulnerable to the same type of cheating that was discovered at UltimateBet.  For this reason, players should not pay for a subscription there.  Players that are interested in playing there should mail in a postcard to ClubWPT for free membership.  ClubWPT is required to offer a free membership under sweepstakes laws.

Lessons Learned From UltimateBet

There were several lessons learned at UltimateBet.  The site was full of incompetent employees.  The software company created a backdoor to the system that allowed players to see hole cards.  This created an insider cheating scandal that lasted for years.  Players started noticing oddities as far back as 2003.  Greg Pierson, CEO of the software company, now CEO of Iovation, was caught on tape trying to cover up Russ Hamilton’s theft.  There were countless accounts associated with transfers to and from Hamilton.  All of this was exposed when the site was still up and running.  Players chose to play there anyway, citing a shell game with Blanca Games as the reason the site was now safe.

UltimateBet merged with Absolute Poker, another site with an insider cheating scandal.  Neither site paid players all that was owed.  Both tried to cover up the crimes and then asserted that the theft was on a much smaller scale.

Affiliates complained about slow payments from the combined Absolute Poker/UltimateBet network known as Cereus.  When affiliates start getting slow-paid, that is a sign that there are financial problems.  UltimateBet offered great rakeback deals good bonuses for the U.S. market to lure deposits.  All of these problems were ignored by players.

All of these issues should have been red flags.  If a site is cheating players, the people behind it are rogue.  The lesson is to not play at sites that steal.

What UltimateBet Was Like

UltimateBet was once one of the top three sites in the U.S.  It was the first to attract a stable of professional players.  Annie Duke and Phil Hellmuth were the best known.  The tables were circular.  The poker room spread unusual games that included Seven Card Stud, Pineapple and Pineapple 8 or Better.  In its early days, they awarded extra VIP points to players that helped start tables.

Where Are UltimateBet’s Components Today?

The ClubWPT subscription poker site uses the old UltimateBet software.  Pala Interactive appears to be developing a New Jersey poker platform using the old poker software as its base.  The CEO of UltimateBet during the cheating scandal, Jim Ryan, is CEO at Pala Interactive.  The CEO of the former software company, Greg Pierson, is CEO of Iovation.

A device reputation program known as iesnare was created through the UltimateBet software by the company that is now known as Iovation.  That product is used at offshore online gambling sites in an attempt to prevent fraud.  Russ Hamilton is believed to be in Aruba working in the gaming industry.

Scandals Related to UltimateBet

Snapshot
Player Funds Lost?
YesLast Payout:
2011

Additional Resources:
The UltimateBet cheating scandal

UltimateBet was scandal ridden.  Its insider cheating ring fleeced more than $20 million from players.  While not directly related, Absolute Poker had a cheating scandal that used the same method.  The two sites later merged to become the Cereus Network.  Pitbull Poker also used rogue software to help insiders see hole cards of opponents.

UltimateBet’s parent company Exscapa was involved in an unusual transaction.  The site went private after the UIGEA was enacted in the U.S.  Shareholders were eventually stiffed by the newly formed company that went through several shell games.  One of those was Blanca Games.  Another related scandal was Madeira Fjord bondholders that held $250 million in debt.  That group stopped getting paid well before Black Friday and filed for bankruptcy shortly thereafter.

Speaking of Black Friday, it was another scandal involving UltimateBet that carried over into other sites.  Executives at Cereus, the network of the combined Absolute Poker and UltimateBet, were indicted on April 15, 2011.  That date is known as Black Friday.  PokerStars and Full Tilt were also indicted on Black Friday.  Cereus and Full Tilt imploded after the indictments were unsealed.  Financial improprieties were exposed.

There were more scandals related to UltimateBet well after the site closed.  It was discovered that ClubWPT was using the same software.  Iovation, a company derived from UltimateBet, tried to sneak into the regulated Nevada poker market.  Pala Interactive, who’s CEO was the leader at UltimateBet during the cheating scandal, required a lengthy licensing process where the Ney Jersey Division of Gaming Enforcement ultimate ruled the company qualified for a license there.  Iovation, even with its history, managed to gain licensing in Nevada after much debate.

All of this proves that online poker needs licensing.  It would prevent those with dirty hands to get back into the industry under the excuse that there was never a conviction.

Player Impact

UltimateBet players were cheated twice.  The first time was when Russ Hamilton and maybe others stole over $20 million from players.  The network used player deposits to pay back some of the affected players.  The same thing happened when the Absolute Poker cheating was discovered.  After Black Friday, it was clear the funds were not available to pay players.  Nearly everybody that had money on deposit at UltimateBet was lost.

A handful of players received small cashouts after Black Friday.  These were under $500 and only involved players outside the United States.

The U.S. Justice Department decided to pay UltimateBet victims in 2017. Affected players may file a claim at Absolutepokerclaims.com.

Related Failed Sites

UltimateBet Timeline

  • 2001
    UltimateBet opens.
  • 2003
    Insider cheating begins at UltimateBet.
  • 2006
    UltimateBet subsidiary issues initial public offering.
  • 2006
    UltimateBet remains in U.S. market after Black Friday.
  • 2006
    UltimateBet is brought private to avoid legal exposure to shareholders.
  • 2006
    Announcement made that UltimateBet and Absolute Poker will merge.
  • 2007
    Players start to uncover insider cheating at UltimateBet, site denies accusations.
  • 2008
    UltimateBet begins investigation into cheating accusations.
  • 2008
    UltimateBet concedes that insiders cheated players.
  • 2008
    UltimateBet and Absolute Poker combine player pools to create the Cereus Network.
  • 2008
    The Kahnawake Gaming Commission declares Russ Hamilton to be the mastermind behind the UltimateBet cheating scandal.
  • 2009
    Cereus stops paying Madeira Fjord shareholders.
  • 2010
    Cereus is allegedly acquired by Blanca Games, an empty shell company. This transaction turns out to be a sham.
  • 2011
    Affiliates start to complain about slow payments.
  • 2011
    Player cashouts slow down.
  • 2011
    Cereus indicted on Black Friday. All pending withdrawals are canceled.
  • 2011
    Cereus stops accepting new U.S. players and deposits but allows existing players to stay.
  • 2011
    Cereus announces that U.S. players are no longer welcome but does not actually ban them in the software.
  • 2011
    A handful of cashouts are processed to players outside the U.S. Prop players are given priority. The largest cashout is $500.
  • 2011
    The traffic at UltimateBet is falling drastically. It never recovers.
  • 2011
    Player count at Cereus drops to zero.
  • 2011
    Cereus goes offline permanently. All player funds are lost.

UltimateBet FAQ

When did UltimateBet launch?

UltimateBet launched on March 1, 2001.

Was there a cheating scandal at UltimateBet?

Yes. Russ Hamilton used a rogue software patch to see the hole cards of opponents.

How much money was stolen from players in the UltimateBet cheating scandal?

The estimated losses to players were $22.1 million.

How is Iovation related to UltimateBet?

Iovation’s CEO Greg Pierson was one of the founders of UltimateBet. Pierson was caught in a recording trying to cover up the extent of the UltimateBet cheating scandal.  Iovation’s iesnare product is a derivative of UltimateBet’s software.

How is Pala Interactive related to UltimateBet?

UltimateBet’s former CEO and other employees work at Pala Interactive now. The old UB software may be under development there to be used in New Jersey.

When did UltimateBet close?

UltimateBet went offline in October 2011.

How much money did Cereus owe players when it went offline?

Cereus owed about $45 million when it closed.

Did UltimateBet players ever get paid?

The U.S. Justice Department set up a claims process for UltimateBet victims in 2017. The site to file a claim is Absolutepokerclaims.com. Players have until September 30, 2017 to file a claim.