Oct. 19, 2007— -- You've gotta know when to hold 'em, know when to fold 'em -- and know when to turn to the collective intelligence of the Internet to root out an alleged online poker gambling scandal.
A network of professional gamblers turned amateur sleuths followed the money in what appears to have been a series of rigged online poker games, gathering what they say is enough evidence to accuse a part-owner and former executive of the Web site Absolutepoker.com of cheating by looking at other players' digital cards.
The allegations have the $9 billion to $12 billion online poker industry abuzz. The Internet gambling business, which is illegal in the U.S., is built on the trust that the games, based on offshore servers, are being run on the up and up.
AbsolutePoker is headquartered in a semi-autonomous Mohawk Indian territory outside of Montreal. Both the Quebec provincial police and officials at the Kahnawak Territory told ABCNEWS.com that they have launched investigations into the allegations.
The controversy began last month, after a suspicious Marco Johnson, 21, of Las Vegas e-mailed AbsolutePoker for a history of the cards he was dealt during a high-stakes tournament. It was further brought to light Wednesday in the New York Times' Freakonomics blog.
"Basically, I took second place in a tournament, and there were just too many weird hands at the final table," Johnson told ABC NEWS.com. "My friends thought I got cheated and I e-mailed [AbsolutePoker] and asked for a hand history."
What he received instead was a document that included the hand histories of everyone involved in the tournament, their e-mail addresses and the IP address of their computers.
That information, either mistakenly sent by a company employee, or intentionally leaked by a whistleblower, seemed to confirm Johnson's initial suspicions and set off an amateur investigation.
"It's so shady. Why would they send me this whole file? A regular hand history just shows the cards you had, but this was the master copy of a file in Excel. It showed 14 tables, every person at every table in the tournament. Instead of just seeing my cards, I could see everyone's," Johnson said.
Johnson took second place, a prize of $20,000, in the tournament, losing out to the suspected cheater, who played under the handle Potripper and bagged $30,000.
"[Potripper] was cheating in the most obvious way. He was just a bad poker player and was playing very badly," said Serge Ravitch, a New York lawyer and professional poker player who moderates the Web site 2+2.com and was one of the first people Johnson trusted with the Excel file.
"In the last hand, he just blew it. He made a gigantic call with 10 high. The chances of winning a hand like that are something like one in 1,000. It was obvious he was cheating,"
Johnson also shared the file with player and poker blogger Nat Arem, who looked past the hand histories to the IP address of the players.
The Excel document showed that at each table Potripper played, another user identified as #363 was present. Online players could not see him at the virtual table, but he apparently could seemingly see everyone's cards.
Potripper folded twice before #363 began watching, then did not fold once before the flop for nearly another half hour of play.
In the Texas Hold 'Em game used in the tournament, players are dealt two cards down and then make a hand from five community cards that are exposed one at time on the table for all to see. It's a game of patience where players tend throw in a lot of hands without betting, waiting for a suitable opener.
Arem traced the IP address of the observer back to the Kahnawak Gaming Commission, the collection of servers in Canada at which AbsolutePoker was based.
Further sleuthing seems to link that IP address to a part-owner of the company, Scott Tom, and the Potripper account to a former director of operations at AbsolutePoker named AJ Ripper, Johnson said.
"It looks like the Potripper account is registered to AJ Ripper and Scott Tom's e-mail turned up. But I can't say for sure that someone else wasn't using his account, or it wasn't someone else sitting at his computer," Johnson said.
Neither Ripper nor Scott could be reached by ABC NEWS.com.
Ravitch estimated that AbsolutePoker stole between $500,000 and $1 million over a two-week period. "We know approximately when it started, but we can't say for sure."
He said the online poker community "came together in an unprecedented way" to investigate the allegations because "those concerned could not let it go unchecked."
Wednesday, following a piece about the scandal in The New York Time's Freakonomics blog, the Kahnawake Gaming Commission, which hosts AbsolutePoker, said it hired an independent investigator to audit the company.
"It is essential that all online gaming and wagering is conducted in a fair and honest manner where customers are protected. The Kahnawake Gaming Commission is committed to ensuring fair and honest gaming," commission Chairman David Montour, said in a statement.
The Quebec provincial police told ABC News they were looking into the matter but could not comment on a pending investigation.
Frank Catania, a former gaming commissioner in New Jersey who helped the Kahnawake Gaming establish its regulations, said under commission rules AbsolutePoker could lose its license and individuals could be turned over to Canadian authorities.
"If anything was done illegally or dishonestly, the company could have their license revoked, the money could be refunded or legal ramifications could happen," he said.
Online poker, Cantania said, falls under a "hazy gray area" of U.S. law. Wire laws, he said, are generally interpreted to cover sports betting and not games of skill.
Most online casino and poker sites, however, are located offshore and are subject only to the regulations in their host nations. Some countries, Cantania said, are better than others.