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Concerns Mount Over Former UB CEO Jim Ryan's Role at Pala

Following the announcement that the New Jersey Division of Gaming Enforcement had approved Pala Interactive and Borgata for a transactional waiver to operate an online gaming site in the Garden State, the poker community started voicing their concerns.

The criticisms landed squarely in the lap of Pala Interactive CEO Jim Ryan, who was the central figure and the source of this frustration.

With this week’s news that Pala’s online casino has entered into a soft launch stage, overseen by the DGE, the initial displeasure has continued to grow and is now at a point where the principles involved have been forced to respond. Ryan’s and Pala’s approval has now been addressed by both the NJ DGE and the man at the center of the controversy himself, Jim Ryan.

Jim Ryan talks

Ryan, a longtime player in the online poker world, landed at Pala Interactive after stepping down from his position as co-CEO of bwin.party in late 2012.

Prior to his time at bwin.party, Ryan was the CEO of Exscapa, the parent company of Ultimate Bet, and before that spent several years at Cryptologic. Unsurprisingly to anyone in the poker community, it’s his time at UB that has many questioning whether he should be allowed to participate in the regulated U.S. online poker and gambling market.

Ryan has never been directly connected to the cheating that took place at Ultimate Bet, but secretly recorded audiotapes (Cliffs version here) were released where the conspirators talked about Ryan possibly having knowledge of the events after the fact, and it’s these tapes (and the fact that insider cheating did occur on his watch) that his critics have pointed to – it should be noted that these tapes do not prove (keyword: prove) Ryan had knowledge of the cheating after the fact, and are simply hearsay.

To his credit, Ryan conducted an in-depth interview with Chris Grove of OPR.com where he addressed some of the community’s concerns.

One of the bigger reveals in the interview was Ryan crystallizing his time at Ultimate Bet, including when he severed ties with Ultimate Bet – something Superuser investigators have been trying to pin down for quite some time. The issue at hand seems to be Ryan’s role with UB from November 2006 through May 2008, a period where Ryan said that he acted as a court appointed inspector during Exscapa’s liquidation.

Under Ryan’s timeline (he claims to have left his role as CEO of Exscapa in November of 2006), he would have left the company before the scandal broke, which directly contradicts some of the things said on the Travis Makar tapes mentioned above, but he was involved as an inspector when the cheating scandal came to light.

DGE addresses the situation

In what seems like an “I’m not a witch” moment, the New Jersey DGE released a letter on their website which concluded that they had done their due diligence (during their preliminary investigation) on Pala Interactive and on Jim Ryan and concluded that Ryan was not involved or aware of the cheating that took place at Ultimate Bet during his tenure as CEO.

The letter was signed by DGE Director David Rebuck, who stated he was making it public “…to provide some clarity with respect to the division’s actions to date.”

Rebuck went on to address the Superuser scandal at Ultimate Bet (the letter demonstrates the DGE has intricate knowledge of the events, which is a very good sign), saying “it raised serious issues about the operation and regulation of online gaming,” and that questions regarding Ryan’s potential involvement in that matter have surfaced.

The letter goes on to say that Jim Ryan “will be the subject of further review going forward,” but, “at this time, the Division has no evidence that he was aware of, or complicit in, this fraudulent activity.”

I love the transparency of the DGE and I hope they continue this moving forward.

Unfortunately, when you are forced to release a statement of this kind it’s usually because you are losing the messaging battle. This is by far the most controversial online gaming decision the New Jersey DGE has made up to this point, and whether Ryan is found to have played a role or is completely exonerated, hopefully it doesn’t undermine the public perception of the DGE’s licensing process and regulated online gambling in the U.S. in general.

As the letter entails, the DGE has done a lot of investigatory work, including listening to the Makar tapes, and laying out a timeline of Ryan’s activities in the iGaming world.

Still, as the DGE notes in the letter, they have only completed a preliminary investigation, and Pala and Jim Ryan have been approved for a 6-month transactional waiver at this time.

Persons of interest

It should be noted that Ryan isn’t the only person from Ultimate Bet/Absolute Poker who has resurfaced in the poker world. Greg Pierson heads the Internet security company Iovation (which briefly conducted KYC checks for Ultimate Poker in Nevada before the poker community caught wind), and Paul Leggett, who served as the COO of UB/AP in the wake of the cheating scandals and the companies’ subsequent merger, had a short stint at Amaya Gaming which ended in November 2013.

On a completely unrelated note, the DGE letter ends with the following sentence:

“The preliminary agreement also disclosed that the sponsorship agreement between Pala and Phil Ivey, signed in April 2013, was terminated in June 2014.”

 

 

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Steve Ruddock

Steve is veteran of the the poker industry, first as a player and now as a writer focusing mainly on the regulated U.S. markets and the politics of poker. Follow Steve on Twitter @SteveRuddock and at Google+.

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