John King and Andre Nestor discovered a bug in the Game King video poker machine that let them exploit it over and over, winning as much as $500,000 at a visit and eventually they became part of the first gambling crime spree in Pennsylvania, and they could have gotten away with it.
The Game King bug was not localized to a few units. It was present in every machine, and King and Nestor shared the secret. The short version of the story is they made a lot of money, parted ways, then got caught by a Las Vegas casino’s eye in the sky and brought to justice.
The full story is here. After reading it it’s hard to know whose side to take. If I found a bug in a “game” I may think it is just part of the “game” and enjoy exploiting my winnings with my magic little sequence of button pushing, or I may take the moral high ground and call IGT the manufacturer of Game King machines.
Problem number one with the team of King and Nestor is they got greedy. The chances of anyone discovering their secret was even less than finding the bug in the machine. It was a system that was foolproof – if they kept their heads and their hands where they should have been.
On the one hand, it is easy to criticize their actions because we know that we would have acted differently and made better decisions, right? But we are not them, nor were we in their position. On the other hand, there is a lesson to be learned about acting in concert with someone as a partner who you decide to share the wealth with, said everyone who has been through a divorce.
Two great motivators of human behavior are fear and guilt. In casinos, they take the form of spending any money while there because the possibility of losing it all means explaining to friends or family why you decided to go in the first place. This is the fear factor. (Winners do not face this dilemma by the way.)
Guilt sets in when win, lose, or draw, you think you could have spent your time doing something else with your money and time. You could have put the money in the bank or donated it to a charitable cause. In the case of King and Nestor, it was the fear of never having won enough.
This is different from greed because greed is based on continually wanting more. Fear in this case rose up because it was hard for either of them to admit they believed they would get caught. That fear meant gambling wasn’t a hobby or career, but a means to an end that would end sooner than later. They know they would win. Yet the aura of a casino is such that players believe their luck will eventually run out. That fear was the motivator for the “get what you can, while you can” actions.
Eventually, the fear led to mistrust between King and Nestor. As expected, that led to the two parting ways with a certain degree of animosity. The one time trust that led to their mutual gains changed into every man for himself once the reality of the strategy resulted in piles of cash. Despite the split, the strategy still could have worked if they were both careful and realized both could benefit regardless of any disagreements.
The surprise comes at the end when the eye in the casino sky noticed King winning at a highly suspect pace. Nestor, who was in Pennsylvania, had been banned from a casino after getting too vocal about his success and too greedy with the system. He was surprised when one day the FBI came crashing through his door.
There are a number of issues with this story that could be considered controversial. One is, that while King and Nestor were arrested and tried in Federal court, the case was eventually dropped. The problem was that there was no existing law to deal with such a case. To their credit, Nestor and King stood firm, did not take any plea bargain and did not turn on one another when the prosecution offered leniency to the first one that would admit to the alleged wrongdoing.
Another issue with this story is that while the government could not prosecute either of the adventurers, the IRS confiscated all their winnings and returned them to the casino. On top of that, the IRS sends them a tax bill for the money they confiscated. The money was not returned to them even though no wrongdoing had been proven. The lesson is that when it comes to money, the government is king.
Part of the controversy involves the casinos. King and Nestor beat them at their own game and they were none the too happy about it. So they cry foul to the government even though there is no existing law to prosecute either of the men. Their machines had a flaw, and though the goal of a player is to beat the house, that goal is only allowable by the house rules. Consider that when a machine malfunctions, the player forfeits any winnings. But in the King and Nestor situation, the bug was part of the game programming and not a malfunction.
In the end, the attempt to take advantage of a exploit made the lives of Nestor and King more miserable than if they had just left it alone and enjoyed the games. The actions of the casino and the government are not only questionable, but in retrospect, unfair. But life, just like gambling, does not concern themselves with fairness without a beneficiary.