"Sixty Minutes" to Detail Damages of Unregulated Online Casinos

Because the United States has not provided its citizens with a safe, regulated Internet gambling industry, poker players at the two online casinos were cheated out of an estimated $20 million.

A long-awaited story concerning online gambling cheating will be aired on the CBS television show "Sixty Minutes" this Sunday. Airing at 7 p.m. Eastern time, the show will probe the details of the cheating scandals uncovered earlier this year at Absolute Poker and Ultimate Bet.

Because the United States has not provided its citizens with a safe, regulated Internet gambling industry, poker players at the two online casinos were cheated out of an estimated $20 million. Software operating the sites had been tweaked to allow certain players to see all hands at the tables at which they were playing.

The scandals were revealed through the persistence of online gamblers who noticed highly unusual results. Even though site managers tried to ignore complaints about improbable play that somehow consistently won, players such as Todd Witteles tracked hand results.

Witteles, a former computer scientist, and Michael Josem, a computer security expert used mathematical analysis to figure the likelihood of the particular player winning in the fashion he was. Josem says, "...they were winning at about 15 standard deviations above the mean...approximately equivalent to winning a one-in-a-million jackpot six consecutive times."

Both Absolute Poker and Ultimate Bet are licensed by the Kahnawake Tribe outside Montreal, which licenses several hundred online casinos. The tribe assured players after the revelation of the cheating that the software glitches had been installed by employees under previous ownership, and those workers had been let go before the scandal was discovered.

But the Kahnawake did little more than offer gamblers their promise that everything was fixed, not very encouraging to those who had taken their word that games were honest in the first place. No criminal charges have been filed, and no transparency of the investigation nor the resolution have been provided by the Kahnawake Gaming Commission.

By continuing to resist legalization and regulation of online gaming, the U.S. has left its citizens unprotected. The comments by gambling opponents that the industry is dominated by unscrupulous and shady organizations becomes self-fulfilling prophecy when well-regulated and legitimate companies are forced to withdraw from the American market. Scandals such as the Absolute Poker and Ultimate Bet quagmires can be laid at the feet of U.S. lawmakers.