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A Wired article from earlier this year describes how a regulatory change in Russia (suddenly prohibiting most gambling) flooded the market there with old slot machines. Some technically skilled people bought those machines and figured out the rules by which they operate in great detail. They then used that knowledge to classify the operation of similar machines in the US, making predictions about what button-press timing would lead to improved payouts, and use those predictions to guide their gameplay and win money.

This seems very similar to a common purpose for entering casinos: people go in, at least thinking they know the rules of a game and intending to use that knowledge to win money. Most of them do win money. Only some walk away with a net gain, but those folks are then touted as example customers so that more people will be convinced to come in and place bets.

However, the folks who learned how the slot machines worked and use this to win by playing well were then prosecuted and jailed for years as perpetrators of fraud. What is the particular law that they violated? What is the threshold where it's considered fraud if you know too well how the game works? Why does the casino get the option of prosecuting players as criminals instead of making the tradeoff between accepting losses vs. using better pseudorandom number generators?

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    If you have a PACER account, the details are here: plainsite.org/dockets/2nlxsngl2/missouri-eastern-district-court/… – user6726 May 27 '17 at 16:10
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    Reverse-engineering the PRNG in an EGM is not "knowing the rules", otherwise looking through the cards in a blackjack deck would also just be "knowing the rules". – Nij May 27 '17 at 21:52
  • My bet is that the casino has a rule prohibiting use of predictive gadgetry, which customers have to agree to, in order to play (probably in a broad "will follow the rules" notice). That agreement, though, was knowingly false. – user6726 May 27 '17 at 22:55
  • @Nij It is knowing the physical and mathematical rules. Knowing the distribution of cards in a blackjack deck and being able to compute probabilities based on that distribution - including the portion of the distribution remaining after some cards have been revealed - is typically not prosecuted as fraud. – WBT May 28 '17 at 3:05
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    I'm trying to answer the question asked. If I observe many spins and figure out that a wheel is weighted ever so slightly toward one side, and bet more on the appropriate numbers, is that fraud? Would it be the casino's job to fix that, or my job to forfeit any winnings while absorbing losses? Where's the line of what's crime and what isn't? Also, the casino does get the benefits of the prosecution, as it changes the cost/benefit analysis for the people who would be figuring out how to win more often at these games. – WBT Jun 3 '17 at 1:41

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