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They aren't charging the defendants with a 'moral' crime. I'm not sure what their exact charges are, and they depend on minutae like the article said: "crossing state lines makes it a felony conspiracy to commit fraud". Gaming regulations are written to favor the house. You're correct that we wouldn't expect them to be charged with "tampering with a gaming device" because they never touched it, and they got comparatively light sentences (2 years) compared to Nevada where you can easily get 5-10. Some states may have a new law like "using a computer to manipulate a gaming device" or similar. I think they put that one on the books so that you can't cheat roulette by calculating the trajectory of the ball, or identify unique variances in cards. Regardless, you can expect the laws everywhere to catch up after this incident.

I disagree that the "system is designed to beat you" or that the casino "cheats". The casino is there for entertainment. If you don't use it in moderation it can ruin your life just like any other vice: alcohol, drugs, sex, etc.

If you have $1000-$5000 (or more), you can fly out to Vegas for the weekend, have a really good time (gaming is only part of that), fly home, and you've got a significant chance that you'll either win or break even. You might also lose, and that's the excitement cycle that is gambling. But even if you lose you can also have a good time at a show/nightclub/concert, every kind of themed bar, meet women, etc, so if you discard "winning money" as the primary objective, gambling isn't designed to beat you.

If you go to the casino every day after work, don't be surprised that you will not win anything, or that it might escalate just like any other drug (spending more, not happy when you win, etc).

What shocks me is that these guys have the technical prowess to reverse engineer the game/PRNG, but they didn't have the sense to slow down their pace, or reverse engineer the casino management system to avoid detection (or they didn't think to hide their iphone from the start, they said the first guy was holding it right up to the screen, when $100 spent on a clothing alteration would have allowed him to hide it). If you're going to fly internationally to commit a crime, you should know who you're up against and use adequate countermeasures.




"If you have $1000-$5000 (or more), you can fly out to Vegas for the weekend, have a really good time (gaming is only part of that), fly home, and you've got a significant chance that you'll either win or break even"

FYI Vegas is built on rubes like you.

There is a larger chance you will lose money than break even or win money.

If there was not, Vegas would not exist and its business model would have failed a long time ago.

Their business model works because the House wins.

For the House to win and be profitable, the average person has to lose on average.

If you're going to have fun, that's a great experience, but if you think there's a "significant chance" you're going to not lose, you're exactly why Vegas does as well as it does.


I think the digler999 simply means significant differently than you do. A 40% chance, for example, could still be interpreted as significant. Numerous casino games when played optimally give you a better chance than that of winning or breaking even.


I think that the odds of walking out of a casino with equal to or more than you walked into it is less than 40%. My stats knowledge is failing me right now but if you start with $100 and feed slots at $12/m after an hour the average person should have less than $50 remaining based on the house cut in the article (7.129%).

It would be interesting to see what the likelihood of being up after an hour of regular play is by different common games.


Sure, at slots, but the parent alluded to other games where the odds aren't quite so bad.

In addition, games like poker aren't even played against the house; you're playing against the other players (and the house just takes a cut as a sort of "table fee"). If you're a skilled poker player, you can reduce the effects of luck (what cards you get vs. the cards others at your table get) and come out ahead more often than not.

And I'd agree that even a 30-40% chance of coming out ahead would be "significant"... people in the startup world still start new companies despite the conventional wisdom of a 10% success rate.

Having said that, sure, casino games are pure entertainment. Sure, you can win a little money, but you should never expect to, and you shouldn't play unless you're comfortable losing every cent you put into it.


If you fly to Vegas, put it all on black at roulette, then yes you have 47% chance of doubling your money. But that's a very short vacation with little entertainment value.

The more independent small bets you make, the lower the chance that you will come out ahead.


Slot machines are the worst though.

The last time my wife and I were in Las Vegas, the only game we made money on was sports betting.


With correct play slots have some of the lowest house edges per dollar bet. Sports betting has a fairly high edge, 4.5% on normal bets and much higher on exotics. The difference is you make a few sports bets and walk away, while with slots you keep cycling money through until you lose it.


The problem indeed is the small cycle time. If you bet on a sports match with a 4.5% expected loss, then watch the game, you can limit your losses to about 4.5%/hour.

A slot machine with an expected per iteration loss of .1% and a modest 100 iterations/hour, would, over that same hour lose you (just) go over 9%.


The problem with that analysis is that ignores the risk. A 40% chance of winning the lottery would be great, because in the 60% case you've only lost a few bucks on the ticket. However, a 40% chance of winning in a casino is not ideal, because in the 60% case you've lost a ton of money.


exactly. and vegas in particular has the best odds in the nation. It's more typical of indian/riverboat casinos to ratchet up their house edge. vegas you're more likely to see 99% payback machines (of course it varies). They'll do other things to make up for it though, like having fewer $5 blackjack tables and more $25 minimum tables.

vegas can afford to turn their hold percentage much lower because millions of people go there every year and there's competition. Versus a lone indian casino in california's central valley.


> For the House to win and be profitable, the average person has to lose on average.

and if people always lost, vegas would collapse because people would stop going.

You could make the argument that any other expensive hobby is also throwing away money:

* boating: buy a brand new boat for $65k, sell it 8 years later for $35k, plus $5k in total operating costs/insurance. You just "lost" 35k (not counting interest)

* rock climbing: buy $3k of gear and travel, $2k on lessons. Fall and break your arm for $6k, $11k "lost" for a couple years of entertainment.

* "travel", spend $6-10k on hotel, airfare, meals, in 2 weeks, all we have left to show for it is "memories". Great "investment".

(disclaimer: I'm not actually against the things I just mentioned. Only pointing out that they are "throwing away money" just like a weekend in vegas). Unless you're some hyper-disciplined monk who only uses money for humble necessities, you, too are throwing away money just like people do in a casino.


I think the difference in perspective here is that many people see gambling explicitly as a way to make money—not something they would do for fun, but something they would do because they need money, like a job.

These people are mostly wrong (save for the games of skill, e.g. poker, that are only played in casinos for traditional reasons.)


However, both your examples gave you "years" of entertainment while travel/vegas is very shortlived for a similar amount of money


Who are you to tell people how to spend on entertainment? Some people want to spend money on rock climbing, and others want to spend money on gambling. As long as neither leads to financial ruin, who are any of us to judge? I don't work hard so other people can tell me how I should and shouldn't have fun.


The state already tells you how to have 'fun'. What's the difference between being addicted to slot machines and being addicted to -your favorite drug- ? As long as it doesn't lead to financial ruin, it should be fine?


Well, yes, as long as your drug addiction doesn't hurt anyone else, I'm personally fine with that. I wish the state would stay out of it.


> There is a larger chance you will lose money than break even or win money.

The games are setup to take a percentage. It varies with the game. Slots are some of the worst, IIRC the house take is 10%. Pai Gow poker (depending on house commission and exact rules) is 1%-3%.

If you make bets commiserate with the size of your gambling budget then your expected loss over the long term for slots is 10%. Your expected loss for Pai Gow is 1%-3%.

If you make larger bets than you should given your bankroll or play bad strategies you can lose a lot more. If you get lucky and quit immediately after a big win you can come out ahead.

The house doesn't give a fig if the average person loses or wins; they just need people to play. They are well aware a significant number of people will walk away winners and that makes them happy: it's great marketing!


in las vegas, the hold percentage (on average - since each property can do whatever they like as long as its within regulatory limits) was ~8% in 2016 in vegas, and ~6% statewide in nevada [1]

[1] (pdf warning) http://gaming.unlv.edu/reports/nv_slot_hold.pdf

Yes pai gow or 21 or (the best odds not including card-counting, IIRC), baccarat have better odds. But, if you go to a premier casino on the strip, you might not find a table you can afford. It's not uncommon for them to have a couple $5 tables and the rest $25 (per bet) and up. Mathematically it's a better choice, but a $25 buy-in costs $500 which you can lose in minutes if you're unlucky. Not a lot of people can stomach that (nor should they, as my original argument was for the entertainment value of gaming).


You misunderstand the word 'significant'. Your statements don't refute anything he has said and seem to miss the point.


>> "crossing state lines makes it a felony conspiracy to commit fraud".

I don't see any fraud though. Sure, they found a system to beat the slot machines, but I'm not sure how that's fraud. What if some guys think they're really good at playing poker and they take a trip to a casino to play?

At what point does playing smart become fraud? or cheating? When does counting cards in blackjack become cheating? When you get too good at it? This whole area seems rather strange.


The big factor here is that casino's specifically forbid the use of devices intended to affect the outcome of the game. You go to a casino, you have to play by their rules. If not, they can argue you are attempting to defraud them.

Counting cards is a much better example of "playing smart", and it is not actually illegal - although casinos will ban any player they suspect to be counting they will likely not be charged with a crime. But once you bring a personal implement in to the situation, it very much becomes a prosecutable crime.


>> The big factor here is that casino's specifically forbid the use of devices intended to affect the outcome of the game. You go to a casino, you have to play by their rules. If not, they can argue you are attempting to defraud them.

I understand that they may kick you out for being too good (he must be "cheating"). And the argument about using a device to aid you might be a more concise definition of cheating of some sort. But I've never noticed any posted rules that one would reasonably be expected to know about. And the use of the term "fraud" is important because then it becomes a legal issue with big consequences beyond getting kicked out or banned from a particular casino. OTOH a casino doesn't need to post the law for people to read. Does the law defer to the casino rules? That wouldn't be appropriate IMHO.

There are "house rules" and there are laws. I'm kind of wondering where those lines are and what specifically these guys did that constitutes a felony. What specific aspect of their scam was illegal. I'm not disputing that it was dishonest and in effect a scam of sorts.


IANAL but there are a few things in this matter that seem to be common knowledge. How these things will apply to a specific instance is for lawyers to discuss. The law, at least in Nevada, does defer to the casino's right to do business with whomsoever it chooses. The law does not permit the casino to beat a card counter up (like in the movie "Casino") but they can insist that such a customer leave and never come back, and in those cases at least in Nevada, when such a customer tries to return, they may become a trespasser [1].

[1]http://www.pandullolaw.com/Criminal-Defense/Trespassing.aspx


Casinos can forbid all they want, but the teeth in the deal is that lawmakers back up the Casinos' rights to set the rules and force you to play by them.


To be fair, the lawmakers aren't really necessary. It only avoids the friction of forcing every gambler to sign a legally-binding contract before playing.


It is, insofar as it turns what could potentially be a civil suit into a criminal proceeding.


"What if some guys think they're really good at playing poker and they take a trip to a casino to play?"

Depends on what they're doing to be "good". Things like card counting can and will get you banned from casinos (though that's more applicable to blackjack).

Advantage play is usually frowned upon but not outright illegal. I reckon exploiting bugs in a slot machine's PRNG really ought to be closer to that than "fraud". Hence, I'm surprised these Russians were charged with anything at all rather than just banned from various casinos as is more conventional for this sort of thing.

I guess the difference between "advantage play" and "fraud" in this case would be whether or not the culprits are breaking the rules of the game. It doesn't sound like they are, seeing as how they're not tampering with the machines.


They were charged and pled, that doesn't necessarily mean fraud was actually committed. DAs have wide latitude when charging people with crimes. If you were a foreign national caught doing this, would you want to take a chance with a jury or bench trial in a hostile (to you) jurisdiction?


> They were charged and pled,

Are you saying these people are innocent, and by some strange stroke of chance and luck, they all boarded a plane, flew across the world, and randomly won thousands of dollars ?

> would you want to take a chance with a jury or bench trial in a hostile (to you) jurisdiction?

hell yes I would. People love to rally behind the underdog and see the casinos lose. Look how much publicity the cases get when a machine malfunctions and displays $1,526,838,003.35 on the win meter, and like clockwork, they file a lawsuit to try to claim a billion-dollar payout.( they dont win, but still, people love to rally behind the plaintiff in those cases).

I'd say for the most part, the criminal courts are hostile to all defendants, not just by definition but by the "plea deal" schemes that prosecutors use and by the puritanical tendencies our society shows in their harsh punishments against "offenders" (viz. the drug war, sex offenses, gun charges, etc)


>Are you saying these people are innocent, and by some strange stroke of chance and luck, they all boarded a plane, flew across the world, and randomly won thousands of dollars ?

I think he's saying that they are not necessarily guilty beyond a reasonable doubt of the crime of fraud ("deliberate deception to secure unfair or unlawful gain"). Given the facts presented in the article, I don't think there's much debate to be had about whether they used devices to win at the slots. The question is whether the particular way they did it is (or ought to be) illegal in the jurisdictions they were in.


> At what point does playing smart become fraud?

when you use an active device that essentially guarantees you will win. Elsewhere in the thread someone quoted the Nevada regulations that explicitly state this. I'm sure each state has them now. Had they arrested these guys and didn't find an iPhone with custom software, or a confession that they were remitting their winnings back to Russia, they probably wouldn't be able to charge them with anything (but they could still kick them out of all casinos).


I wonder if they would have been convicted if they'd enabled encryption + a long password on their phone?


better would have been a dead-mans switch: if they let go of the iPhone for more than 6 seconds the program wipes all traces of itself off.


> these guys have the technical prowess to reverse engineer the game/PRNG, but they didn't have the sense to slow down their pace,

Based on the article, it sounds like these guys were more like mules, than they were the masterminds. 90% of the money was sent back... And they rely on this remote system to figure out the next state. This software possibly could be run directly on the phone, but instead they want to keep a tether on the mules.


As the guy in "Casino" movie said, they're all greedy.




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