Greg Pierson Biography

When most people think of gambling, their minds conjure up names such as Phil
Hellmuth, Doyle Brunson, and Phil Ivey. These are the faces of the industry, but
there are an equal number of men and women who work behind the scenes without
garnering the attention of the masses. Greg Pierson is one such individual,
although hardcore gambling enthusiasts may forever associate his name with one
of the biggest scandals in the history of online poker.

The Early Years

Pierson was born in the state of Oregon in 1967. Following a rather
uneventful childhood, he attended Oregon State University from 1985 to 1989 and
graduated with a bachelor’s degree in both economics and business
administration. During his college years, he also participated in jazz band and
the school’s water polo team.

Following graduation, Greg landed a job with Accenture, where he served as a
Global Retail Practice Manager and Business Process Architect. In the course of
his duties, he worked closely with companies such as Bridgestone/Firestone,
Lands’ End, and Nordstrom.

As the tech industry continued to grow, Pierson became, in his own words, a
“computer geek.” This love of technology, and a desire to get in on the ground
floor of a booming market, led him to found a company (along with Jon Karl)
named ieLogic in 1999.

While they would eventually grow to provide other services, the original goal
of ieLogic was to supply software to the online video game industry. During this
period of his life, Pierson also married Portland-area high school teacher
Janelle Lynn.

The Creation of UltimateBet

In 2000, Pierson and Karl took part in the incorporation of an Antiguan
company named eWorld Holdings. A number of investors were involved, and one of
the main figures was former World Series of Poker winner Russ Hamilton. The
purpose of this venture was to eventually launch a new online poker site called
UltimateBet.

The business launched the following year, and ieLogic was tapped to develop
the software that would power the site. UltimateBet had no problem getting
licensed by the Kahnawake Gaming Commission, and they would offer a wide variety
of options including Texas hold’em, Omaha, seven card stud, and mixed games.

Personal Problems

In January of 2003, authorities were notified of an inappropriate
relationship that had occurred between Janelle Lynn Pierson and a 16-year-old
male student. This affair had started in January of 2002 and lasted through
November, even continuing while the teacher took a medical leave for severe
depression related to the incident.

Once the matter became public, Greg Pierson disappeared for two weeks in
early 2003. He eventually surfaced in Costa Rica, then later returned to the
United States. Meanwhile, the parents of the minor refused to press criminal
charges, but a financial settlement was reached between the two parties. In
addition, Janelle Lynn Pierson was given five years of probation, ordered to
attend counseling, and permanently barred from working in a school setting.

The Rise of UltimateBet

Despite his problems at home, Pierson’s professional life was booming thanks
to the rise of online gaming and the success of UltimateBet. The company held
million-dollar tournaments, sponsored a televised poker series, and boasted such
celebrity endorsers as Phil Hellmuth and Annie Duke. At their zenith, they were
the world’s fourth largest online poker room.

In 2004, ieLogic was split into two new companies: Iovation and Excapsa. The
former was responsible for providing software to the site, as well as assuming
duties related to online fraud detection and risk management. The latter,
meanwhile, became the owner of UB and was eventually traded on the London Stock
Exchange.

By 2006, the site was sold to Blast Off Limited, which was in turn owned by
eWorld Holdings. This move was in anticipation of the passage of the Unlawful
Internet Gambling Enforcement Act in the United States, and UB continued to
accept American players while many of their competitors abandoned the market.

The following year, Tokwiro Enterprises purchased UltimateBet. This company
also owned Absolute Poker, and the pair were packed together to form the Cereus
Network. Unfortunately for online gamblers, the entire house of cards was about
to come tumbling down.

Downfall

Over at Absolute Poker, a number of top-tier players were repeatedly beaten
by an individual known as “Potripper.” After a series of investigations by
dedicated customers, it was determined that someone was using a “God Mode”
account that allowed them to see the cards of all players involved in a hand.

No criminal charges were ever brought against the guilty party, but Absolute
Poker was fined $500,000 by the Kahnawake Gaming Commission and forced to pay
back $1.6 million to players. Oddly enough, their license was never revoked.

The Kahnawake Gaming Commission released a report about the matter on January
10th, 2008. Exactly one day later, UltimateBet–the brainchild of Greg Pierson
and sister site to Absolute Poker-began to suffer through its own series of
allegations.

A user with the handle “NioNio” was tearing through veteran players,
consistently pulling offs wins that were next to impossible. Players once again
took matters into their own hands, gathering evidence and conducting research
that eventually revealed 23 accounts and 117 usernames linked to cheating. Russ
Hamilton was at the center of the scandal, and it was later revealed that more
than $22 million was stolen by those with access to a “God Mode” account (much
like the Absolute Poker incident).

Hamilton’s lawyer, meanwhile, denied the accusations on behalf of his client.
The Kahnawake Gaming Commission was unconvinced, and they later named Hamilton
as “the main person responsible for and benefitting from the multiple cheating
incidents.” Of course, company co-founder Greg Pierson was also subject to
plenty of suspicion and accusations.

Despite calls for UltimateBet to be stripped of their license, the company
continued to operate. They were, however, fined $1.5 million by the Kahnawake
Gaming Commission and order to pay back the more than $22 million that had been
stolen from players.

Wild theories and accusations began to fly. One of the most popular involved
a desperate Pierson going to Hamilton for help (and money) after his wife ran
into legal problems. In this scenario, Hamilton dipped into the till to help his
business associate, and he never stopped dipping. Keep in mind, however, that
not a shred of evidence exists to support this theory.

Pierson, for his part, remained silent about his role in the scandal. This
encouraged wild speculation among the Internet crowd, although the bulk of their
ire was aimed primarily at Hamilton.

By November of 2008, Tokwiro Enterprises had settled a lawsuit against
Excapsa for $15 million. At the same time, UltimateBet was paying back those who
had been impacted. A major marketing push was also underway in an effort to
bring customers back to UB, and the poker room was eventually sold to Blanca
Gaming.

Black Friday occurred in 2011, and the world of Internet gambling was forever
changed. Blanca Gaming was eventually forced to file for bankruptcy, with unpaid
debts reported to be in the range of $50 million.

Life Goes On

Greg Pierson isn’t one to give up, though. While his Excapsa brand might have
fallen on hard times, his company known as Iovation kept chugging along by
offering security and fraud prevention to customers. In 2013, he was even
nominated for the Ernst Young Entrepreneur of the Year Award.

His past would come back to haunt him from time to time, though. For example,
when it was learned that Iovation was providing fraud management services for a
site known as Ultimate Poker, the wave of customer complaints resulted in the
company looking for a new security provider.

The Smoking Gun

In 2013, a damning three-hour audio tape was released by Travis Makar, a
former assistant to Russ Hamilton. Recorded in 2008, the tape captures
conversations between Hamilton, Pierson, and attorneys Sandy Millar and Daniel
Friedberg.

As the men try to get their stories straight, more details about the dirty
dealings of UltimateBet come to light. Pierson never admits to any direct
involvement, but Hamilton certainly comes off as a villain. In fact, the former
WSOP champ states at one point, “I did take this money, and I’m not trying to
make it right, so let’s get that out of the way.”

A Bright Future

In February of 2016, it was reported that Iovation was unanimously granted a
gaming license by the Nevada Gaming Commission. Despite the serious doubts of
one commission member, the company now has the ability to provide anti-fraud,
cyber security, and geolocation services to all licensed sites within the
state’s online gambling industry.

Meanwhile, Iovation boasts a customer retention rate of 98%. They employ over
100 individuals at their Portland headquarters, and their list of clients
numbers into the hundreds.

Quotes about Greg Pierson and UltimateBet

During the course of the UB scandal, numerous professional poker players came
forward to provide commentary about both Greg Pierson and the company he
co-founded. In this section, we’ll look at some of the most notable quotes from
Pierson’s business associates, former friends, and those who had the misfortune
of losing money via UltimateBet.

First up, we have Annie Duke. A longtime associate with UB, Duke maintained
her affiliation with the company even after the scandal became public. However,
when the Smoking Gun Tapes were released and Duke was accused of cheating, she
finally spoke out and sought to distance herself from her business associates.

“Listening to the leaked audio that describes an elaborate attempt by some of
UltimateBet.com’s founders, including Russ Hamilton and Greg Pierson, to cover
up cheating reminds me once again how much I regret having been associated with
the people that were involved in this conspiracy. The release of this audio has
spurred accusations and I want to make it clear that I have never used a tool on
a delay or otherwise that gave me or anyone else access to hole cards for use
during real money play nor was I aware that such a tool existed until the
scandal broke.
Knowing what I know today, I would have never encouraged anyone to play on
the UltimateBet.com site under that management. I’m horrified at the lengths to
which these people went to try to cover up their actions, and I am very sorry
that I ever agreed to work with them. I remain very upset that people were
cheated and that, partly because of the actions of the people on this tape, it
took far too long to pay back the $23 million that was owed to the victims, and
that hand history information was never fully provided to the public.”

Next up is Phil Hellmuth. One of the most successful poker players in the
history of the game, Phil was known to be a friend of Greg Pierson, as well as a
spokesperson for the controversial UltimateBet website.

“I’ve made a living off of reading people at the poker table and in the
business world. Trusting my gut has allowed me to be at the top of my profession
and develop a lifetime of friends and great experiences.

Unfortunately, I made a horrible read regarding my relationship with the
founders of the now defunct online poker site Ultimate Bet.

I trusted their team and believed in their ability to run a first class
website and business. Most importantly, I allowed them to convince me that they
were honest and forthright. I’ve never been more wrong about anything in my
life.”

While Duke and Hellmuth both distanced themselves from Pierson and his former
company, they still walked away from the scandal with a tidy sum of money in
their pockets. Not all poker players were so lucky, however, which brings us to
Mike “The Mouth” Matusow.

“This man (Russ Hamilton) would call me to play him head-up. I would ship
$50,000, $50,000, $50,000. All the money I won when I won the ’05 World Series
Main Event, when I got to the final table and when I won the Tournament of
Champions, I gave all to Russ to put on UB while he was playing me heads-up and
stealing it from me. The two people that got beat the most were Prahlad Friedman
and myself… What [Russ] did to him was just brutal.”

Speaking of Prahlad Friedman, here’s what the WSOP bracelet winner had to
say:

“I remember days where I’d be up $50,000 and then I’d play some random guy
and he’d kill me. I’d just play and play and play and not quit a guy. I never
did that. I would give them 10 buy-ins because I had so much confidence and felt
I could adapt to the way they were playing. Occasionally I’d win a huge pot on a
hero call. That was tough for me. I was doing so well, was on top of the world
and then hit that rough patch. I figured it was variance. Variance happens.”

Despite his negative experience with UB, Friedman signed on to endorse the
company a few years later (before having his contract terminated in 2011). When
he was criticized for allying with a company that had stolen millions from him,
Friedman replied with the following:

“I feel like they took care of me after the scandal. I feel like they didn’t
have to pay people back and they did. It was amazing to find out I was going to
get a hunk of money back. I have a good relationship with their team and their
management and I feel like this is a totally different UB than anything
associated with the scandal.”

Holding Patents

Throughout his career, Greg Pierson has boosted his personal wealth and
overall reputation by being credited with a number of patents. There are three
major examples, and this section takes a brief look at each.

• Patent #7,272,728 (issued
  in September of 2007)

  Created by Greg Pierson and Jason DeHaan, this patent
  covers a network security and fraud detection system and method. Its description
  is as follows: “A system and method to detect and prevent fraud in a system is
  provided. The system may uniquely identify physical devices connecting to a
  network, register unique devices, track end-user logins, associate end-user
  accounts with specific devices, and share information with multiple network
  service providers is described.”

• Patent #7,526,796 (issued
  in April of 2009)

  Created by Greg Pierson, Dan Lulich, and Ron Lunde, this
  patent concerns the methods and apparatus for securely signing on to a website
  via a security website.

• Patent #8,751,815 (issued
  in June of 2014)

  Created by Greg Pierson, Ron Lunde, and Dan Lulich, this
  patent involves “creating and verifying globally unique device-specific
  identifiers.”

Conclusion

The world of online gambling has plenty of unpopular figures, but Greg
Pierson remains among the most disliked. While there’s no clear evidence that he
participated in or knew about any wrongdoing in the UltimateBet cheating
scandal, there are numerous players who continue to hold him and his anti-fraud
software responsible.

Despite his controversial past, Pierson continues to move forward with his
life. Iovation remains a leading player in the tech industry, and their recent
approval for a Nevada gaming license assures the self-confessed computer geek of
continued success for years to come.