"I don't like to lose..."
Posted on 04/11/2008 9:40:48 AM PDT by NormsRevenge
SACRAMENTO – California's first inspection of slot machines at Indian casinos has found widespread software lapses that could be short-changing tribes, the state and millions of gamblers, the state's gambling commission warns in a new report.
State inspectors approved just 60 percent of the slots that were examined last year at seven casinos, which included some of the most successful and sophisticated in the nation.
But tribal representatives and commission staff members disagreed sharply about the severity of the software shortcomings flagged in nearly 500 machines examined at the casinos, including those operated by the Pala, Pauma and Viejas tribes of San Diego County.
Nearly 40 percent of those machines were running software deemed obsolete because the manufacturer had issued upgrades – in some cases, more than four years earlier – designed to correct flaws that had emerged.
Although such software does not always pose a risk, some of the flaws were serious, the commission's staff concluded.
The software in question has sent incorrect financial information to the central slot-machine accounting system, accumulated credits incorrectly, occasionally bet more credits than players intended and miscalculated progressive jackpots always to the players' detriment, the report said.
Credits reflect the amount of money deposited in a machine and rise and fall with winnings or losses.
The slot accounting system collects the basic financial information for a casino's books, generating the data from which the tribe calculates its profits and share of revenues, if any, that must be paid to the state.
Despite the potential problems, the state did not require tribes to replace obsolete software.
“The manufacturer hasn't said that the software's been revoked,” said Richard Ross, deputy director of the commission's compliance division. “They're just warning them of the problem. . . . The manufacturer is no longer putting that software out, however. It's a gray zone.”
Howard Dickstein, an attorney who represents Pala and another of the inspected tribes, United Auburn of suburban Sacramento, said it is common industry practice to continue using software deemed obsolete until a machine is routinely upgraded.
“It's like having Windows '03 or Windows '07,” Dickstein said. “There is nothing wrong with the software and, by definition, the differences between the old and new software don't involve game integrity, they don't involve any critical issues.”
Ross said the commission chose only to underscore the risks that manufacturers had identified in software they deemed obsolete. He agreed that tribes could continue to use it.
“You can drive your car on bald tires, too,” he said.
James Maida, president of Gaming Laboratories International, said the industry has different definitions of what constitutes obsolete software. The company, the world's largest independent testing operation, has done work for tribal casinos throughout North America.
When Maida's operation declares software obsolete, “it means we don't want you to be installing that software any further on your floor. It may stay on your floor, because in our opinion it doesn't pose a risk to the player or to the house,” he said.
But for some manufacturers, a notice that software has become obsolete is tantamount to a warning that it should be revoked, Maida said.
The slot-machine inspections were performed last year at the three San Diego-area casinos, plus those operated by United Auburn, Quechan of Imperial County, Rumsey of Yolo County and Coyote Valley of Mendocino County.
The seven tribes were chosen because their amended gambling agreements, or compacts, expressly authorize the state to inspect their slots. The commission plans to extend the program ultimately to all of the state's Indian casinos.
The report offers a rare glimpse inside the state's $8 billion tribal gaming industry, which is guaranteed broad confidentiality in its gambling agreements with the state.
The commission reported the inspection results collectively for all seven tribes, although Ross said there was a wide range between individual casinos. Tribal representatives interviewed yesterday declined to release individual numbers.
“We're proud of our results,” said Bob Scheid, a Viejas spokesman. “The issues on our casino floor mostly involved one minor technical issue with the software. In fact, it only required a reset. At no time did it affect play, payout or anything like that.”
Scheid said Viejas' commitment to oversight, regulation and integrity is reflected in the $4.5 million a year it spends on its gaming commission.
In a statement, Joanne Willis Newton, counsel for the Pauma Gaming Commission, noted that the state acknowledged that obsolete software does not necessarily pose a risk. She said the presence of some “is unavoidable because such software is constantly being upgraded.
“In Pauma's case, although obsolete software was found, there were no incidences where the (gambling commission) recommended that the . . . software be removed from the casino floor,” Newton said.
The Legislature ordered the slot-inspection report two years ago as a condition of its approval of eight temporary positions to launch the inspection program. The commission has asked the Legislature to approve $1 million this year to make those positions permanent. Otherwise, they will expire at the end of June.
A Senate committee balked, however, this week when the commission delivered the report more than a month late.
“The slot machine is the cash register now,” said Steve Giorgi, the commission's executive director. “It's a computer and a very sophisticated device that reports to their accounting center . . . all the revenue coming in and all the revenue going out.
“When we go out and do financial audits, we rely upon the general ledger. The slot machine information gets to the general ledger. So we need to be assured that that information is being reported correctly.”
But Dickstein, the attorney who represents two tribes, accused the commission of overstating its findings in a bid to save its field inspection team.
“This is transparent attempt by the commission to justify their supplemental budget request by attempting to show that they are doing something,” Dickstein said. “But this is a real reach.”
It’s not like the odds aren’t against ya from the gitgo anyway.
‘’always to the players’ detriment’’ — How convenient...
Credits reflect the amount of money deposited in a machine and rise and fall with winnings or losses.
The slot accounting system collects the basic financial information for a casino's books, generating the data from which the tribe calculates its profits and share of revenues, if any, that must be paid to the state.
In other words, they're skimming off the top.
If the machines are collecting $100 but only reporting $80, then that machine just gave the house $20, which is not traceable.
Not only that, but they're stealing from the players. (More than usual, that is.)
"I don't like to lose..."
The key in the article: “...and miscalculated progressive jackpots always to the players’ detriment...”
Duh. That is why only fools play slots thinking they will EVER come out ahead in the long run. Playing for fun is different.
In the 1990’s I saw a 60 minutes episode on electronic gaming. The one interesting point in the story is that one computer programmer, who was working with authorities regarding software design, was GUNNED DOWN in his homes driveway.
That told me all I need to know about electronic gaming and why I would NEVER put a single penny in a slot machine.
What did they think a One Armed Bandidt would be programmed to do?
Hey, set ‘em to NEVER pay off, and have floor shills working the room with a little remote override pretending to win. More money that way!
< /sarc >
Here is a link to a story that covers this in detail. In my opinion, many of Harris’s statements are incorrect.
http://www.americancasinoguide.com/Tips/Slots-Honest.shtml
and not one lawyer has filed a class action suit on this...
Sounds to me like the “Well, DUH!” moment of the week!
Wrong.
The slot machines are much more secure, the software has to be written to much better standards and the hardware is much more tamper resistant.
No, it is not. Stop ripping off your customers. It's not like you operate on a tight margin and can't afford upgrades.
Huh?
Well, since there's no such thing as "Windows '03" or "Windows '07", Mr. Dickstein's other observations on software integrity and efficacy aren't what I'd deem of an expert caliber.
I wonder how one pronounces “Dickstein?”
OOps.. lol
Abort, Refry, or Flail?
Windows Server 2007 was recently re-named Windows Server 2008 by the perpetually late Microsoft.
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