Two gamblers in Las Vegas who apparently took advantage of a software bug to win big bucks from video poker machines have been able to avoid federal prison. A federal judge in Las Vegas last week dismissed the federal charges against the two men. This ended a two year legal battle over whether what they did was illegal or not.
John Kane, 55, was arrested in July of 2009 at the Silverton Casino Lodge after the business discovered suspicious play on one of its video poker machines. Kane is an avid gambler and he had found a software bug in one of the IGT Game King machines that allowed him to play a previous winning handing at 10x the original value. He had been using the software bug to rake in a lot of winnings from casinos in Vegas.
Andre Nestor, 42 and a friend of Kane, also was arrested on federal charges in Pennsylvania for using the same bug at another casino, walking away with $400,000 in winnings.
In January of 2011, Las Vegas federal prosecutors charged both men with wire and computer fraud. They argued that the complex pressing of buttons needed to make the bug work was a type of hacking. Defense lawyers argued that the men were only playing by the machines’ rules. In May, the prosecutors lost a pre-trial argument over the applicability of the Computer Fraud and Abuse Act, so they dropped the charge of hacking. But they kept on trying to get the wire fraud charge to stick.
But in a court filing last week, the US government admitted that it did not have a case. According to an assistant US attorney on the case, the feds looked at the evidence and circumstances and determined that they did not have a strong enough legal case.
Kane’s attorney predicted earlier this year that the feds would have a difficult time making a fraud case stick. He noted that in most gambling cheat cases, the person does something to the machine, using a magnet in a boot or shocking the machine with electricity. These two men just pushed buttons on the machine that they were legally able to push.
According to earlier media reports, the casino pulled the machine from the casino floor after Kane won $8200 from it. He already had won several big jackpots that day in the casino that required IRS paperwork. When they pulled the logic tray and EEPROM in the machine, they found that he was exploiting a software bug in the Game King machine and several others.
They way it worked was Kane would choose a poker game, and play it at a low denomination, such as $1. He would keep playing until he won a lot of money, such as $820. Then he would switch to another poker game, and would play until he got a win. Then the machine would offer a double up, which lets the player put the winnings up to a high card wins draw. Then Kane would get more cash and put it into the machine and exit the poker game and which the denomination to the maximum the game allows, which is $10 in the game in Silverton.
When he got back to his previous poker game, the $820 would still show, and he would then be able to cash out and get the jackpot again. But now it would recalculate the win at the $10 level, and he would get $8200.