Lentis/Gambling

The Bellagio Hotel and Casino in Las Vegas

Gambling institutions such as casinos are places where technology and social issues interact on a daily basis. Since their inception, gambling institutions and their patrons have each walked a fine line dividing socially acceptable and unacceptable behavior, and groups on both sides of the debate have strong arguments for their positions. These arguments often revolve around certain technologies or techniques relating to gambling. This article will look at three case examples that illustrate the gray areas surrounding gambling and provide the views of the parties involved. By examining these issues we can better understand where many groups draw the line on what is acceptable behavior. To limit the scope of the article, we only consider these examples in the context of U.S. gambling.

Slot MachinesEdit

A Woman Playing Slots in Las Vegas

When slot machines were first invented in the late 19th century, they were simple mechanical devices. As slot machines have become more advanced, some have argued that the new technologies are predatory while others have argued that they are simply making the machines more entertaining. Slots account for a majority of the income of casinos, so this makes the debate about slot machines an excellent way to view opinions about gambling in general.

Electromechanical Slot MachinesEdit

The first electromechanical slot machine called Money Honey was developed in the 1960s. The new technology let the machines flash lights and play sounds when a player hit a jackpot. Opponents claim that accompanying a jackpot with bells and lights causes "the odds [to] become obscured in our minds, and we suddenly think that this is a legitimate game we can win after all" [1]. Manufactures counter by claiming that the bells and lights only increase entertainment and that, since regulations mandate that a slot machine must pay out a minimum return, no player should be ignorant of the machine's return.

Random Number GeneratorsEdit

In 1984, the first patent for a slot machine that used an electronic random number generator was filed [2]. The new technology allowed manufacturers to "make a machine that is perceived to present greater chances of payoff than it actually has within the legal limitations that games of chance must operate" [3]. One way of presenting better odds than the machine actually pays out is to have a high "near miss" rate. Near misses are generally occurrences of two jackpot symbols on the pay line and a third jackpot symbol above or below that line or a winning combination occurring just above or below the pay line.

Opponents claim that having a high near miss rate is just another way that slots are "designed to psychologically prey upon the user" [4]. Distrust of the new machines grew to the point that, in 1988, the Nevada Gaming Commission heard arguments regarding the legality of slot machines produced by Universal. In these machines, "after the determination of win or loss has been randomly made, losing combinations of symbols are weighted and then selected so that certain losing combinations appear more frequently on the pay line than other losing combinations". This artificially increases the odds of a near miss occurring. The commission banned this functionality, claiming that they did not provide an "accurate representation of the game outcome" [5]. However, in 2007, Harrigan identified three current slot machines that, by adjusting the award symbol ratio appropriately, legally produced each near miss 4.1 times as often as a jackpot [6]. In addition, the ruling makes no mention of high rates of near misses that occur above and below the pay line. These near misses are considered legally acceptable today.

Casinos and manufacturers have complied with the Nevada ruling, and now each reel is guaranteed to be independent of the others. Since slot machines are audited regularly, have minimum payouts, and are based on a single random event, casinos claim that there is nothing predatory about the games. The law seems to agree, though the debate over slots remains.

Counting CardsEdit

Casino patrons use a variety of techniques to attempt to gain an edge over the house. Some techniques are legitimate, others clearly fall in the realm of illegal behavior, and others still make up a gray area. One such technique used by a number of players is known as card counting, where a person keeps track of the cards that have been played to have a better understanding of the odds in future hands (primarily in blackjack).

Using DevicesEdit

An old way to count

Counting has long been considered a skill that only certain people were capable of mastering. However, recent advances in computing technology, especially the microprocessor, have made the technique available to anyone. Starting in 1969, Keith Taft began creating a device that allowed him to count cards while remaining concealed in his shoes[7]. The device was operated by using the big toes to adjust the count up and down.


Later on, another of his devices was discovered in use[8], prompting a change in the Nevada legal structure to protect casinos. Prior to 1985, there was no restriction on counting cards in Nevada. As a result, no one caught using the device could be prosecuted. Nevada Senate Bill 467 was signed into law in 1985, becoming NRS 465.075[9]. The law prohibits the use of any device in a casino to aid in projecting the outcome of a game or keeping track of the cards played.

While still illegal, a number of devices continue to be developed for the sole purpose of keeping track of the count in blackjack. Small electronic devices, such as the BlackJack Buster[10][11], look innocuous and are relatively discrete, while removing all of the challenges of trying to remember the count mentally. In 2009, an iPhone application was released that turned the phone into a card counting device [12]. Shortly thereafter, the app was banned in Nevada[13].

Casino ResponseEdit

NRS 465.075 forbids the use of devices, but simply using your memory is not illegal. Casinos frown heavily on the practice because it significantly reduces the edge that the house has over the player to the point where the player actually has the advantage. As such, they try to discourage the practice by using multiple decks, not dealing the entire shoe, shuffling often, requiring flat betting, or banning individuals from casinos (which they are legally entitled to do because they are private establishments)[14].

To combat card counting, some casinos began to adopt a system called MindPlay starting in 2003. MindPlay was an entire system composed of a table, cards with invisible markings, chips, and scanners. The system keeps track of the count of the deck to determine if there is any correlation with how the players are betting. Additionally, the system was used by certain establishments to shuffle the cards before the end of the shoe when the count was in favor of the player, ensuring that the casino always has the advantage even against card counters[15].

Cameras are a huge part of casino security, including identifying possible counters

The MindPlay system drew a lot of criticism from players. These players claimed that the casinos were in violation of NRS 465.075 for using a device to keep track of the count. The claims against these casinos are summarized in John Allen vs. State of Nevada[16]. The primary complaints were that “The MindPlay device also allows casinos to project the outcomes of games, analyze the probability of certain events relative to the game, and analyze strategy for betting in a game.” Other advantage players refer to the system as a “rip-off” and encourage fellow players to “Tell [the casinos] that you; your family, and your friends won’t be back until MindPlay is gone.”[17] As a result of the controversy surrounding the system as well as its low reliability, it was discontinued in 2007.

In general, cheaters also have strong opinions about the casinos and their tactics. When asked if he felt guilty for cheating casinos, legendary casino cheat Richard Marcus replied, “Guilty? You kidding! F--- them! I only regret I didn't make more money. I consider casinos bigger thieves than myself…”[18] Marcus goes so far as to operate a web site to tell people the tricks of how to cheat the casinos[19], purely for informational purposes.

Online GamblingEdit

The new face of gambling

The introduction of internet gambling technologies has radically changed gambling in the United States. By taking their business online, gambling institutions are able to reach new customers and avoid many of the costs associated with physical casinos. For example, a physical casino must use more of their expensive space if they wish to add a new poker table, but an online casino can add more poker tables at negligible costs. Since many U.S. states have laws against gambling in physical casinos, online casinos are able to expand their market to include new customers who may never have been able to gamble before. With Americans betting over $100 billion annually[20], online gambling has become a very profitable industry which has attracted the attention of a variety of social groups.

Morality and Problem GamblingEdit

One of the most significant moral issues with online gambling is the problem of age verification. It is illegal for minors to gamble in the United States, but it becomes much more difficult to verify the age of a gambler over the internet. Groups such as the Nevada Council on Problem Gambling and myaddiction.com stress the importance of restricting underage exposure to gambling because of correlations with problem gambling (also referred to as gambling addiction). Online gambling advocates argue that many measures are being used to restrict access to adults, for example the Safe and Secure Internet Gambling Initiative asserts that "the Internet offers unique opportunities for protections against underage gambling that aren’t available in traditional gambling environments."[21]

Another social concern associated with online gambling is the perception that online casinos prey on problem gamblers to a much greater extent than physical casinos. The National Council on Problem Gambling and other problem gambling support groups stress the many ways that online gambling can exploit the weaknesses of the problem gambler. For example, online gambling can provide the problem gambler with instant gratification, anonymity, and can help him or her hide the problem from friends and family. Online gambling advocates counter that the internet offers many new ways to help gamblers be responsible and limit how much they gamble.[22]

LegalityEdit

In the United States, the most important court decision regarding online gambling came when the United States Court of Appeals for the Fifth Circuit ruled that online gambling on a game of chance does not violate United States law.[23] While many new laws concerning internet gambling have been proposed[24][25], as of 2010 there are no U.S. laws which explicitly prohibit U.S. citizens from gambling online or which allow the U.S. government to regulate online gambling.

Future ResearchEdit

By its very nature, a case study analysis is limited in its scope. Further research should seek to expand upon these cases and go more in depth to discover how groups have used technology to shift the balance of power between player and institution. Card counting is only a single way that gamblers attempt to gain the edge over the house. There are a number of more extreme practices including card mucking, past-posting, and other modes of cheating used to tip the scales as well. Researchers should look into how these practices are accomplished and how they have changes by using new technological advances. Additionally, attention should be paid to how casinos have responded using their own technologies (such as RFID chips). Additionally, online and mobile gambling is a huge topic that deserves more attention than we were able to give it. Future research may look into sports betting and other types of online gambling, as well as expand the chapter to include information on gambling outside the U.S. and how it compares.

Useful LinksEdit

Photos of Cheating Devices on Display at Barona Valley Ranch (Includes Keith Taft Device)

Short Richard Marcus Biography

Richard Marcus Discusses Casino Security

Background on Card Counting

NCPG Article on Remote Gambling

Lentis Article on Gaming Addition

ReferencesEdit

  1. Tyler J. Jarvis. "Gambling: What are the Odds?". http://math.byu.edu/~jarvis/gambling/gambling/gambling.pdf. Retrieved 2010-11-30. 
  2. Electronic gaming device utilizing a random number generator for selecting the reel stop positions
  3. Electronic gaming device utilizing a random number generator for selecting the reel stop positions
  4. United to Stop Slots in Massachusetts. "Myths". http://uss-mass.org/myths.html. Retrieved 2010-12-1. 
  5. Nevada Gaming Commission. In the Matter of the Petition of Universal Co., Ltd, and Universal Distributing of Nevada, Inc, For a Declaratory Ruling. Declaratory Order. Case-No. 88-8. March 15, 1989.
  6. Harrigan, Kevin. Slot Machine Structural Characteristics: Creating Near Misses Using High Award Symbol Ratios. International Journal of Mental Health and Addiction, 2007.
  7. "Keith Taft - BlackJack Player". blackjackhero.com. http://www.blackjackhero.com/blackjack/players/keith-taft/. Retrieved 2010-11-30. 
  8. "Vegas Cheats: Keith Taft". onlinepoker.org. http://www.onlinepoker.org/blog/keith-taft-blackjack/. Retrieved 2010-11-30. 
  9. "Chapter 465 - Crimes and Liabilities Concerning Gaming". Nevada State Legislature. http://www.leg.state.nv.us/nrs/NRS-465.html. Retrieved 2010-11-30. 
  10. "804B Blackjack Buster". hackershomepage.com. http://hackershomepage.com/cheat-blackjack.htm. Retrieved 2010-11-30. 
  11. "Review: BlackJack Buster (Card Counter)". edge.i-hacked.com. http://edge.i-hacked.com/review-blackjack-buster-card-counter. Retrieved 2010-11-30. 
  12. "Card Counter By TMSOFT". apple.com. http://itunes.apple.com/us/app/card-counter/id293742180?mt=8. Retrieved 2010-11-30. 
  13. "iPhone Card-Counting App Banned in Nevada Casinos". mobile-tech-today.com. http://www.mobile-tech-today.com/story.xhtml?story_id=64732&full_skip=1. Retrieved 2010-11-30. 
  14. "Dealing With Card Counters". casinocitytimes.com. http://rose.casinocitytimes.com/articles/1021.html. Retrieved 2010-11-30. 
  15. "Attorney Sues Casinos for Using Card Counting System". reviewjournal.com. http://www.reviewjournal.com/lvrj_home/2004/Oct-19-Tue-2004/news/25027617.html. Retrieved 2010-11-30. 
  16. "Allen Vs. Nevada Complaint". bj21.com. http://bj21.com/allen_vs_nevada/complaint.html. Retrieved 2010-11-30. 
  17. "Mindplay Blackjack - The Latest Vegas Ripoff". bjinsider.com. http://www.bjinsider.com/newsletter_61_ripoff.shtml. Retrieved 2010-11-30. 
  18. "American Roulette: Interview with International Casino Cheat Richard Marcus". vegastripping.com. http://www.vegastripping.com/features/feature.php?feature_id=43&page=6. Retrieved 2010-11-30. 
  19. "Poker Cheating and Casino Cheating Expert: Richard Marcus". richardmarcusbooks.com. http://www.richardmarcusbooks.com/. Retrieved 2010-11-30. 
  20. http://www.thefiscaltimes.com/Issues/Taxes/2010/05/20/Internet-Gambling-Betting-on-New-Tax-Revenue.aspx
  21. http://www.safeandsecureig.org/node/18/
  22. http://www.safeandsecureig.org/node/19/
  23. http://caselaw.findlaw.com/us-5th-circuit/1342249.html
  24. http://en.wikipedia.org/wiki/Internet_Gambling_Regulation,_Consumer_Protection,_and_Enforcement_Act
  25. http://www.opencongress.org/bill/110-h2610/show
Last modified on 23 July 2012, at 23:18