Do you think you can beat the casino? There are countless tales told in bars, described in books or glamorized on TV dramas of those who made millions doing it. But there’s always the killjoy who says, “They didn’t build all these giant resorts by losing.”
Being an industry insider for 30-plus years, I know my way around the felt tables. But even though I am long retired and have no interest in any casino today, most folks don’t trust a single thing I say. (The rumors are far more “believable.”)
Here’s an example: I can say with confidence after working across the country that the slot machines in the Reno area are the loosest in the world. But if you ask anyone who just had their entertainment budget gobbled up by one or our local machines, they’ll argue the point.
Facts are facts. The Nevada Gaming Control Board, and similar agencies in just about every other state, publish the casino hold percentages by game type. Anyone can look up these stats online. Some reports show the individual properties, but Nevada only breaks it down by geographical area. Overall, the Reno paybacks on slot machines for all of 2022 were 94.51%. In other words, the casino kept 5.49% of the money wagered.
That compares to the entire state (including Reno) keeping 7.16%, and the Las Vegas Strip raking in 8.14% (just a 91.86% payback). While that doesn’t sound like much of a difference, another way to phrase it is that the slots in Reno are more than 30% looser than those on the Las Vegas Strip. Before you declare that the Strip owners should be jailed, know that their payback percentage is, more or less, about the same as the rest of the country. Table games offer the same odds across the country, depending on the rules.
While the average Reno casino makes 5.5% percent on the slots, remember that these numbers are before expenses like salaries, benefits, insurance and the light bill. Most businesses get to deduct their expenses before paying taxes on what’s left (the “net”). Casinos have to pay taxes on their “gross”—in other words, on the 5.5%. That generates a lot of tax money, and it’s the main reason we have no income tax in Nevada.
Check, and you’ll see that the profit margin for casinos is way below other businesses like jewelry stores, banks, clothing retailers and the like. However, don’t shed tears for gambling joints. Between commercial and Native American operators, casinos made about $90 billion last year across the country. That’s more than Hollywood, the recording business, concerts, newspapers and magazines combined.
How can they make that much, yet claim to be loose and have low profit margins? Volume, volume, volume. Some form of gambling is legal in 48 states, and most have casinos. Only Utah and Hawaii have no legal gaming (but their residents flock to casinos in Wendover or Las Vegas on a frequent basis).
Can you legally beat the casinos? Yes and no.
Today, the best odds are with online sports betting, but not because you can predict who will win or lose. (You can’t; wasn’t your March Madness bracket busted by the second round?) It is because right now, all the big operators (like BetMGM, Caesars, DraftKings, William Hill and FanDuel) are fighting each other for market share. They are offering huge (and stupid-good) promotions. By skillfully taking advantage of these new player deals and using different screen names (although doing so may violate the terms and conditions), you can’t lose. There are even websites like DarkHorse Odds that will explain how to do this—for a monthly fee. But this won’t last too much longer.
Your next-best casino bet is playing loose video-poker machines. You have to do some homework to find great pay tables and improve your skills. By doing that, you can easily get the paybacks to the 99.5%-plus range. There are plenty of books and websites to help you spot good machines and make better decisions on your game play.
Next in the loose line are the traditional table games like blackjack and craps. With standard rules, both games hold between 1% to 2% with skilled play. If you can count cards, you can get “21” above 100%. However, at a recent seminar I attended with one of the world’s best card counters, he said that very few who try to count are good enough to actually make that profit.
What about cheaters? A few of their schemes work, but many have landed in jail. These days, the main target seems to be baccarat games. One of the boldest moves was when players noticed that cards from leading manufactures were mis-cut. This made the patterns on the back of certain cards (like face cards) slightly different from others. Players could then use a technique called edge-sorting to determine which cards were coming out of the shoe next, and bet accordingly. Poker celebrity Phil Ivey made more than $10 million playing in New Jersey using edge-sorting techniques. The casino sued him. He (correctly) argued that he followed their own rules, and that he did nothing wrong. But in 2016, a judge ordered him and a friend to return all their winnings. There were no criminal charges.
Baccarat has also been the target of simple scams like false shuffles and/or high-tech methods using tiny hidden cameras, infrared dyes and miniature radios.
Slot machine cheats have attacked the games with everything from coat hangers to magnets, and light wands to computers. A famous case just a few years ago involved a Russian gang that used cell phones and reverse engineering to outsmart the random-number generators of some older games.
What are the worst games to play? That easy: The lottery is a giant rip-off. The average return on Mega Millions and Powerball is about 55%. States exempt themselves from their own laws that prohibit casinos from offering any game that is anywhere near that tight! (Yet I still buy lottery tickets.)
Roulette has about the same return as many slot machines. Look carefully at the game: If you find a game with just one green zero (rare), the hold is 2.7% overall. A standard “double 0” game is 5.26%. A game with a “triple 0” segment was once considered heresy (with its 7.69% hold), but more and more of them are appearing. Some bets on the roulette layout are better than others, but—trust me—none of the roulette schemes you’ve heard through the grapevine work.
Another tip: “21” tables that offer a 6-to-5 payout for getting a natural blackjack are much tighter than those with traditional rules. And like triple 0, these tables are becoming more common. The best bet is to find the standard 3-to-2 odds. (Pays are shown on each of the table layouts.)
Also, common sense would lead you to believe that slot machines with giant million-dollar jackpots could be tighter than other games. They definitely are.
Do casinos ever lose? Of course they do—but not for long. It’s difficult in Reno, Sparks or Lake Tahoe to make a profit when there’s a blizzard outside, and all the roads coming from out-of-state are closed. Casinos lose lots and lots of money during these meteorological events.
At high-roller casinos in Las Vegas, billionaire-dollar players (known in the business as “whales”) can go on a win streak, sending the house’s profit into the toilet.
Fortunately, when the sun comes out, and the whales founder, it usually goes the other way—and that’s why they can build those giant resorts.
Buddy Frank is a retired local journalist and casino executive. He was recently inducted into the Slot Operations Hall of Fame in Las Vegas.