“…The dealers are watching the players. The box men are watching the dealers. The floor men are watching the box men. The pit bosses are watching the floor men. The shift bosses are watching the pit bosses. The casino manager is watching the shift bosses. I’m watching the casino manager and the eye in the sky is watching us all.” —Ace Rothstein, “Casino”
I was fascinated recently when a betting company gave people the opportunity to create money by leaving something of a hole in its betting system.
The underlying action was based on parlays on baseball games taking place in Taiwan and Korea, and there’s speculation that an operator input incorrect starting times into the system. The system didn’t lock out bets on opening sides and totals on games, so bets could be made on games in progress, which can dramatically alter the math on an event or a series of events, and make a betting kiosk act like a printing press of winning tickets. While this is being depicted as a past-posting incident, and those do happen on occasion, my position is there’s much more to it than just that.
I’ve had the opportunity to do a number of different things in my life, being in and around the gambling business for the last 48 years, but in my heart I think of myself as a casino guy. I spent a lot of time dealing the games in a casino while trying to pay for my education, and I spent a lot of time watching the games being played in a casino after I got my formal education.
Even as president and CEO of a gaming company, I spent a great deal of time on the casino floor, and it used to freak out my fellow workers the first time I would push in on a dice game and deal for a bit. Most casino employees aren’t used to seeing a CEO do such a thing.
A casino floor was and is a place where I feel safe and comfortable, and it seemed to make sense that I would still hang there when I became a casino executive and later a CEO, rather than sequester myself in an office. Early on in the business, I discovered that the casino floor is where a lot of the guests and employees spend their time, and that seemed like an important place to be if a person wants to know what was going on.
I’ll admit that we casino people sometimes exhibit unusual behaviors. I first noticed this many years ago when I was visiting with my friend Lee Skelley. Lee was a casino guys’ casino guy, and one time he and I were at an academic conference in the ballroom of a hotel. There was absolutely no gambling in the area. We were standing shoulder to shoulder, facing in opposite directions, scanning our surroundings as we talked. This was a casino guy or gal thing to do, looking in opposite directions to watch the action around us, because our jobs required it. Over time, this just becomes the default way of visiting for people who’ve grown up in the business.
Other habits that casino folks pick up is clearing their hands to the cameras. This includes after handling money and chips, which makes sense, but we also do it in clothing stores on a day off, or at a market after picking up a tomato. It seems that we’re habitually performing for the cameras, even when there are none, or at least none we care about. I can also be in a packed and very loud casino as a guest, and when I hear the stickman on a dice game tell his box and crew, “Die down,” I immediately direct my eyes to the floor to find the errant cube.
A lot of these habits are because most good casino guys or gals take one thing very seriously, protecting the bankroll of the casino, day after day after day. That’s basically what we do.
Going back to the betting incident involving the parlays on Taiwanese and Korean baseball, I was fascinated by the responses on social media once the event was made public. A number of people who I have a great deal of respect for in the betting community were apparently taken by the supposed dishonorable character of the people who basically drove a truck through the seemingly terrible controls of the betting system involved in this incident. While I really admire this response, this is not a typical casino guy or gal response. This must be a betting guy or gal thing.
When we casino people close a game in the casino, we put a cover over the bank and lock it. And then we check it. And then we might check it again. Then, if we’re in that pit area doing something later, we might check it again. The reason we locked it was we found that this is a good way to make sure the money stays in the store. My attitude was, if we didn’t lock the bank, we should eventually expect the money to disappear. That’s why I’m not too critical of the people who exploited the apparent dumb-ass controls that allowed the parlay betting incident to happen.
When I was a shift boss, casino manager and even CEO, if someone left a game unlocked, I would be annoyed at the people who were responsible to make sure the game was locked. I wouldn’t be annoyed at the person who may have taken the money. Any person that would expect that money to be there later shouldn’t be working as a casino boss. This is how I was taught the casino business, and how I taught other people in the business. Moreover, it wasn’t just locked games we focused on, but a million and one other things. So while the people who allegedly past-posted legs of a parlay had a bit of scorn heaped upon them by social media, in my view the fault rests with the people who worked for the joint, be they the compliance folks, the operator, the systems people or whomever.
My casino guy or gal vision of the world is, you don’t leave doors unlocked on your systems, then play the victim and ask regulators to clean up the mess when someone exploits a vulnerability that you created. This coddling simply leads to further instances with regulators cleaning up further messes. Let the operators eat a few of these incidents, and maybe they’ll start staffing with people who know what they’re doing. This running to the regulator thing is a new normal that I’m find borderline embarrassing. Regulation wasn’t designed to act as a safety net to allow firms to skimp on payroll and hire less than competent talent.
Continuing on the casino guy theme, I was the casino guy who was responsible for the Stardust Casino for a time when the Stardust had a legendary book. The guy who managed that book when I was there was Scott Schettler, who was a fascinating management experience. My primary job as his supervisor was to stay between Scott and the Nevada Gaming Control Board and also the folks who worked at Boyd Corporate. Neither of these two groups understood much about the sports betting business, and also didn’t embrace Scott’s somewhat direct method of communicating.
I agree that Scott was sometimes more than a load to deal with, but I totally respected the man and just loved working with him. There was never a day in my life where I didn’t know what team Scott was on. It was also the case that our book took in a lot of big bets a lot of the time, and at the end of the day we generally had some money left on our side of the counter. We also had a guy named Roxy in our corner. We kept his number handy, and he had our number handy, and he was one of a curious assortment of interesting people in our little village who helped us protect our bankroll and our reputation.
During my time at the Stardust, a human was involved in each betting transaction, and these humans were instructed to contact a supervisor when something didn’t seem right about a transaction. The system would also demand higher levels of approval on some transactions. Well, this kiosk should have also been instructed when to spot curious or suspicious betting patterns or transactions and when in doubt, to contact a supervisor. But this kiosk was apparently too dumb to do that, and this failure to contact a supervisor allowed an earlier problem of a bad lock-out time to be compounded by another operator error, and that was allowing this dumb kiosk to continue taking bets.
If I were the regulator, I would tell the operator to take these kiosks back to the shop and help them learn how to spot curious and suspicious transactions and send out an alarm. I would also mention to the operator that they apparently need all new internal controls, because even with a lock-out mistake, this much value should not have been allowed to be created, especially at this time in the morning, and on these events.
If this story was about a person, or a group of persons taking a great many of these bets in the middle of the night on Taiwanese and Korean baseball, creating six-figure liabilities and not contacting someone, that person or those persons would be known the dumbest sportsbook writer(s) on the planet.
Now pay attention, kids. You utilize technology to replace labor because it helps contain costs. You don’t develop technology that has the skill set of the dumbest sportsbook writer on the planet. That appears to have been the problem here. When I read the stories about this event, it’s like this kiosk was a free agent or rogue operator. These things are supposed to be connected to bigger things, and to communicate with them. It appears that in this case, the kiosk was pretty tight-lipped. Maybe someone needs to get a counselor involved to help this kiosk communicate with its mother ship. From all indications, this kiosk should be reassigned to a roadside truck stop, where it can sell soft drinks.
In 2014, I was the guest at PokerStars’ shop on the Isle of Man, and I spent part of a day looking over the security algorithms they produced for their poker platforms. They were amazing, incredible at detecting all types of crazy things happening on a game, and sending out different notices and alerts. Maybe this kiosk provider should try and hire a few of these folks, because this kiosk was really a soft spot with respect to sound casino controls, aside from the apparent lock-out input error.
Now for those of you that are thinking that this kiosk was approved by gaming control, let me tell you about that. That was a technical inspection performed by electrical engineers and computer-type folks. It didn’t give that kiosk an IQ test to see if it was ready to work on a casino floor, because I doubt that anyone in the approval process for this kiosk has ever worked behind a betting counter and seen what can go wrong. This kiosk was not ready for prime time on a casino floor; it was simply an easy mark, and that was clearly figured out. It also appears that the operator was cool with having a kiosk with a very low casino IQ open all night and alone, which does make me wonder about the operator.
To pile on here a bit more, at the Stardust we also did not book Korean or Taiwanese baseball. We didn’t book stuff we didn’t understand, and we also understood that we were the next-to-last stop in providing integrity to our system (with the FBI being the last stop). Back in the day, we believed the integrity firewall was the experience and talent in the book and some folks we could call around town. If we still needed help beyond that, we wanted the FBI. I actually believe this is still true today, no matter what protections people like to pretend they have. The best integrity systems involve people with betting experience, casino sense, and top notch math skills, and you don’t just hire that off of the street.
And a final point about the booking business from an old casino guy: Anybody who gets their butt tattooed for over $125,000 on parlays on Taiwanese and Korean baseball might want to think about the possibility that they’re in the wrong business. I once knew a man who played major league baseball, and after his U.S. career ended he became a manager of a team in an Asian country. His team made the playoffs, and during a critical game, his star pitcher couldn’t find the plate. In exasperation, he asked his assistant coach, who was a local, what he thought was the problem. The assistant coach replied that the pitcher probably did not want his family to be hurt. My point is, back in the day, we always wanted action, but we wouldn’t throw things on the board where we didn’t have a fair amount of confidence that it was on the square. It just wasn’t worth embarrassing ourselves or damaging our reputation.
A joke that I enjoy telling about the gaming industry—and it is basically a joke—is that the main difference between when I started 48 years ago and now is that when I started, the industry was under the control of organized crime, whereas now it’s under the control of totally unorganized crime. And while it’s intended as a joke, it does capture something that bothers me, and that is that there just seems to be a lot of folks hanging around gaming today who have no earthly idea what they are doing.
Maybe that’s just an old casino guy thing to say.
