Posted by Lending Club :: November 5, 2007 @ 11:15 amGary Hoffman is in the news after he seemingly won $1.6 million dollars playing nickel slots on an Indian reservation in New Mexico. He says he became 'ecstatic' when the machine said he had won $1,596,244. Those feelings quickly soured as the Sandia Resort and Casino claimed the machine malfunctioned and gave him $385 instead. He filed a lawsuit and told ABC News, "I won my money, fair and square and I've been cheated out of my winnings."
This is not the first time casinos have refused to pay winnings based on machine error. A casino in Winnipeg, Canada refused to pay two men $209,716 due to software error in the last year. In 2005, a man received only $1,199 instead of $11 million after a casino in Oklahoma said the machine also suffered from a software error. In one case in Pennsylvania, a casino gave a man two free meal coupons instead of $102,000 after the casino's computer system malfunctioned. They later changed their minds and awarded the man his winnings after an onslaught of bad press.
The controversy has centered on who is at fault – some blame the casino while others blame the machine manufacturers. In other situations, some have even faulted the slot machine players and tried to send them to jail.
The real story, however, is much less exciting and is buried on page 3 of the article. "As for Hoffman, Sandia officials say he has visited the casino more than 70 times in the first six months of 2007, a claim Hoffman did not dispute." Slot machines and gambling are good examples of those money suckers that Maneesh Sethi wrote about last week, here on the Lending Club blog. Regular visits to casinos can quickly drain your cash.
While gambling, it is easy to overlook how much money you are spending. There are several gambling fallacies that cause people to think they can come out ahead. For example, the availability error causes people to be more likely to remember positive events. The news stories of lotto winners cause us to think our odds are much better than they actually are. Statistics show a different story. For example, the odds in the California Lotto Jackpot are approximately 1 in 18 million. If you drive ten miles to buy a ticket, you are three times more likely to be killed in a car accident than to win the jackpot. Avoiding money-sucking games of chance like slot machines and lotteries will help you free up money to invest in person-to-person loans.
Look at it this way - every time you don't buy that lotto ticket you win a dollar.
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2 Comments
You know what's interesting ... "machine failures" only exist when
the casino realizes it has to pay out. It would be interesting to
know how many "machine failures" resulted in a player NOT winning
when they should have. Only a skilled auditor would ever be able to
tell. Furthering that thought, a machine based on random behavior
really can't fail - unless it was never random in the first place.
And by that, I mean "scheduled" to win and lose.
I have lived my entire life in Las Vegas and each year I see more
and more casinos, each one bigger and more lavish than the
previous. What this should tell everyone is that these casinos are
making big money not loosing. They know the odds and they are
stacked in their favor. Over time you can't win. Growing up my best
friends father was addicted to gambling. Some days he would come
home and give my friend hundreds of dollars because he had just won
thousands and then later that week my friend would tell me how his
father had lost his entire paycheck that night. His gambling led to
divorce and also to the loss of his home. It distroyed my best
friends family. The casinos are out to make money and they are
willing to destroy you in the process. It does not suprise me that
they would not give the winnings because of a machine malfunction.
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