KAHNAWAKE GAMING COMMISSION COMMENT ON EXCAPSA RULING

Hard on the heels of press reports concerning an Ontario Superior Court settlement between the software provider Excapsa and Blast Off Limited this week (see previous InfoPowa report), the Kahnawake Gaming Commission has issued an official statement.

The settlement forms a part of liquidation proceedings on Excapsa, which cannot realise the full benefits of a purchase price agreed in 2006 with Blast Off Limited until a $15 million question of compensation has been settled. Excapsa sold its flawed software with UltimateBet and Absolute Poker to an ex-grand chief of the Mohawks, Joe Tokwiro Norton.

The flaws in the software were subsequently exploited, allegedly by former WSOP champ Russ Hamilton, to cheat players at the online poker sites over several years. The cheating was exposed by player-detectives, and this eventually led to the KGC appointing an enquiry into the scandal by consultant and regulatory specialist Frank Catania. Based on Catania's findings, the KGC imposed a $1.5 million fine on UltimateBet, considerably higher than a fine of $500 000 imposed on sister site Absolute Poker some weeks earlier.

The Commission also made the retention of its licence conditional on several requirements to be accomplished by November 3. These included the removal of any staff or contractors implicated in the cheating; proof that the flaws had been fixed; ongoing monitoring by the KGC and the refund of money to all players who may have been prejudiced by the cheating.

Because it was embroiled in a civil claim against Excapsa, which was seeking liquidation, as the seller of the flawed software, UltimateBet asked for an extension of the November deadline, which has now been granted.

The Kahnawake statement reads:

Kahnawa:ke Gaming Commission Confirms UB Compliance with Interim Decision:

"The Kahnawá:ke Gaming Commission ("KGC") announced today that it has received information from its agents, Ultimate Bet and other related parties indicating that Ultimate Bet has addressed, or is addressing, the matters set out in the KGC interim decision of September 29, 2008.

"In particular, the KGC has confirmed that Ultimate Bet has commenced reimbursing approximately US$15 million to players who were adversely affected by the cheating incidents. This is in addition to the US$6.1 million that Ultimate Bet has already reimbursed to players.

"The KGC will defer its final decision in this matter for a short period of time for the purpose of ensuring that all required reimbursements have been made.

"In addition to reimbursements to players, the KGC is considering the available evidence and will decide whether Ultimate Bet has satisfied all of the other terms of the KGC interim decision.

"The KGC's final decision in this matter is expected to be issued once all player refunds have been confirmed.

"Murray Marshall
Senior Advisor
Kahnawa:ke Gaming Commission"

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