Cyber Security Firm Iovation Cleared To Operate In Nevada

Home » Poker News » Cyber Security Firm Iovation Cleared To Operate In Nevada

Tuesday, March 8th, 2016 | Written by Shane Larson

For two years, Iovation has been working towards obtaining a Nevada gaming license, but on February 19, 2016, its application was finally approved by the Nevada Gaming Commission. This means that Iovation will now be able to offer business-to-business services like cyber security and geolocation to gambling operators in the Silver State. Nevertheless, many industry experts are now crying foul over the decision, saying that giving Iovation a license is a mistake.

A Major Scandal

Back in 2008, it was revealed that the online poker site UltimateBet, which was owned by Iovation, had been defrauding players. The software had a God Mode code that made it possible for people within the UltimateBet network to look at their opponent’s hole cards, thus guaranteeing a win. Because of this code, affected players lost more than twenty millions dollars from their bankrolls, while some professional poker players, such as Mike Matusow, also said their constant inexplicable losing on the site caused their confidence, and therefore careers to suffer irredeemable damage.

When the cheating scandal was unearthed, Iovation blamed a number of cheats, including Russ Hamilton, an UltimateBet gaming industry consultant who happened to win the 1995 WSOP Main Event for $1 million. Recently commenting upon their relationship, Pierson explained:

“Maybe I’m stupid or naive but I don’t believe he wanted to rob players. The success of the site was his success. It never occurred to me that he wanted to rob players. He certainly could have because he had access to everything. He just wanted the site to be perfect.”

In the end, UltimateBet paid back only a fraction of the money lost. Needless to say, the scandal greatly tarnished the image of online poker as a whole, and to this day, opponents of online poker legalization will point to it as a reason why iGaming should be banned.

The Iovation Position

The CEO of Iovation, Greg Pierson, has maintained that the cheating that went on at UltimateBet took place without his knowledge. Following the announcement regarding the Nevada Gaming Commission’s decision regarding Iovation, Pierce said that there was now proof that the company as a whole was not involved in the 2008 scandal. He pointed to the fact that the gaming commission examined all of the evidence related to the incident and would not have granted the license if there was any question lingering about the guilt of himself and others at Iovation.

“My company wrote some software and that software was used to rob players. I wish that had not happened. I have had to talk about this nightmare so often that I have become kind of numb to it but hopefully it is now over,” explained Pierson.

Damning Evidence Against the CEO

Despite the fact that Greg Pierson maintains his innocence, there is some proof to suggest that the CEO knew more than he states. An audio recording has surfaced of Pierson discussing the scandal with colleagues. During the conversation, he outlines ways that they could reduce the cost of paying back those who were affected by the scam. The conversation also eludes to the fact that there were earlier instances of cheating that weren’t found by the investigation.

Other Questionable Dealings

Even those who believe that Iovation was the victim of a rogue employee, one has to wonder about how reputable the company really is. After all, UltimateBet blatantly operated illegal blackjack games. There is also some evidence to suggest that the company set up shell offices to avoid complying with certain laws and regulations. When you examine the information surrounding Iovation’s past actions, it’s easy to understand why so many gambling industry experts are concerned with the Nevada Gaming Commission’s decision to grant the company a license to operate in the state. At the very least, the fact that a major scandal was able to be pulled off under the nose of a so-called cyber security expert is alarming.

At worst, the Nevada Gaming Commission’s decision has the potential to negatively impact the gaming industry in Nevada. One influential gaming expert against Iovation being granted a license is Haley Hintze, who for more than ten years has been a chief poker blogger, and an ardent critic of Iovation. Just a few hours after the surprise announcement was made, Hintze tweeted the following question:

“Re: Greg Pierson and @iovation, Greg ordered all records connected to his ‘ATM’ UB player account to be deleted. Should the NGC [NGCB] ask why?”