An online gambling site that operates out of a shopping mall in Costa Rica has been embroiled in a cheating scandal, according to an investigation by the daily Washington Post and the TV program, 60 Minutes.
AbsolutePoker was forced to refund $1.6 million to cheated players after one gambler grew suspicious of a player who couldn´t seem to lose. After calculating that the man was winning at a rate 15 standard deviations above the mean, the suspicious gambler traced the player´s IP number back to a computer owned by AbsolutePoker. The cheater was allegedly an inside man.
A subsidiary of AbsolutePoker, UltimateBet is also now accused of cheating about $20 million from its players. The alleged offenders include UltimateBet employees.
The sites are licensed by the Kahnawá:ke Mohawk reservation, just south of Montreal, on the banks of the St. Lawrence River, which did not return a request for comment. AbsolutePoker also did not return a request for comment.
The Kahnawá:ke Gaming Commission has fined AbsolutePoker and UltimateBet a combined $2 million for the cheating incidents, but would not disclose the name of the alleged inside man who cheated them, according to the Post.
AbsolutePoker told the Post that it fired the cheater, whom they described as a consultant in the Costa Rica headquarters, in Oct 2007, but did not turn him over to the authorities. UltimateBet has begun refunding the $20 million it owes to cheated players.
The online gambling industry generates about $18 billion a year, and the sites are banned in the United States.