We played the game yesterday and we got ourselves into an impossible situation. How the hell could that Szark manage to have 22 hps to start with? Moreover, when we did 12 damages, Imperial guy just simply use his threat level to have him cured.

To this point, you all may think that we rebel must have played poorly. To the contrary, the Imperial guy simply doesnt set up the game right. Instead of having Jyn 2 steps away from the token, he says Jyn should start where other rebels start. We only find out this cheat after the game. So beware of the Imperial cheating tactics which include not setting up the game properly.

Our question is simply put - how come the Imperial guy can bring in his reserved group and open groups without spending his threat level? We cleared all imperial minis before we call Szark out and then he starts with 22 hps, his reserved group and also his open group. No threat has been used for this. Then when we do some damage, he can just use his threat level to heal up all the damage.

Honestly, we think Imperial guy is cheating and if not, the mission is broken because frankly this becomes impossible to play the mission.

Imperial Guy does cheat because in the errata it says he is supposed to tell us all the rules of the mission and he hasn't.

If you think your Imperial Player is intentionally cheating, don't play with him/her.

That said, the asymmetry of information in this game (and lack of subsequent "verification" of the scenario) mean that it is quite possible the IP (Imperial Player) accidentally botches some of the rules or setup.

I would stress that you encourage the IP to actually read out verbatim each relevant portion he is resolving at any given time.

That is, the "Special Setup" for this mission, says:

"Increase threat by twice the threat level and resolve an optional deployment. Jyn Odan does not deploy with the heroes and instead is deployed as shown."

If the Imperial Player read this out verbatim, he or she would have instantly realized the mistake.

It is up to you and your playgroup to decide how to resolve accidental cheating -- you could decide to replay the mission, or maybe you could decide to give the win to the Rebels. That's really up to you, as I assume that this is a casual game.

Regarding the actual mission, it doesn't seem the scenario rules allow the IP to deploy his/her open groups for free at any point during the mission. Reserved groups are almost always deployed by the scenario and thus do not cost threat.

Imperial Guy does cheat because in the errata it says he is supposed to tell us all the rules of the mission and he hasn't.

I'm not sure which part of the errata you are referring to, but the rules of what the IP must reveal can be found in "Page 2" of the campaign guide, which all players (including Rebels) are allowed to read.

Szaak cannot have 22 hp to start with, your imperial player probably mistook threat level for threat. (Szaak should have 10/12/14/14/16 health depending on which side mission it is).

As for bringing out groups, he gets to bring out Szaak and a group of elite trandoshans (which he shouldn't have deployed previously) at no threat cost.

He's definitely not required to tell you all of the mission rules (what he should tell you depends on the mission), he should however tell you that he can heal Szaak (the rate is actually pretty high (he gets two trigger opportunities each of which costs 2 threat to heal 2/3/4/4/5) but he needs to spend threat).

Without more details I'm inclined to give your IP the benefit of the doubt for ineptitude rather than ill-intent, especially if it's xis first time. There is a lot of stuff to remember (In one game I forgot that you need to attack the doors in A New Threat) and no one can tell you when you get something wrong. Of course it's possible that your IP is actually cheating but don't assume as much.

If, as the Imperial Player, I have realized that I have accidentally cheated, and it was to the detriment of the Rebel players (i have been known to pull my punches on occasion), I ask if the heroes want to would like to replay the mission, or take a free 1XP or 500 credits per hero as penance.

Chances are, your Imperial player made some honest mistakes. Give him/her a chance to make up for it. There is a TON of hidden information in the game that the rebels wont even see.

And not to ruin it, but High Moon isn't broken, in fact, with luck and the right plays by the rebels (and the wrong plays by the imperials), the rebels can win the mission in the first round.