Top: Online Gambling, Online Casinos; The Internet Gaming Commission.

Integrity in Online Gambling and The Internet Gaming Commission

By Ion Saliu, Virtual Commissioner At-Large

Integrity, Fairness in Online Gambling: The Internet Gaming Commission.

Posted on November 29, 2000; later updates.

• While researching, I came across a so-called Internet Gaming Commission (IGC), a self-appointed watchdog of online gambling: www.internetcommission.com

I also received the other day the following message:

There are losing streaks and there are winning streaks — that's mathematics. The online casinos, however, grossly disregard probability theory. They established a "law" that "assures" very long losing streaks for the player — but never for the Internet gambling establishment. Don't give me that bull — the gambler's fallacy! If there is honesty, things should closely resemble the calculations of my probability software Streaks.EXE. There should be also a reversed gambler's fallacy, Lady Chance says!

Probability software proves that probability theory is mathematics of streaks, including online gambling.

The Internet Gaming Commission (IGC) appears to possess financial funds. They organize meetings in the manner of “Visual Basic Developer's Conference”. The registration fees go over $1000 per participant. IGC also accredits gambling sites that abide by the rules of the Commission. I believe it is a step in the right direction. It's a jungle out there, when it comes to online gambling.

I'll touch only one major issue and hope to come back with more later. The main issue, one that I raised on my page on gambling fraud (Lottery Gambling Analysis, Math: Odds, House Edge, Fraud): the random number generator. A cyber-casino is accredited by IGC if the site has its random number generator tested by a so-called “Big Six Accounting Firm”. That's a step in the right direction, but further steps are required to assure integrity. The random number generator may be 100% fair and honest. The problem is the usage of the random number generator.

I have written probably the best random number generators. I even offer the source code of the basic program: RandomNumbers.EXE. The source code can be easily adapted to serve many other purposes.

The compiled program of Basic random number generator for any lotto game format.

As I presented on the aforementioned page, the random algorithm is queried by another algorithm to generate one hand for the player and three hands for the casino. I can testify in a court of law that I noticed a slowdown when the player plays very high bets. I noticed the anomaly in the online software and also the blackjack slot machines in physical casinos. The anomaly always plays in the favor of the house, regardless how many players involved. It did not happen to me only. I received a number of messages similar the above.

Here is the real mathematics. The gaming slows down because the random number module generates extra hands. The house gets 3 hands, based on my calculations. Casino games such as blackjack or roulette have a probability close to 50-50, say 52% for the house, 48% for the player. So, the player got one hand (spin) and the house got 3 hands. The house will select the best outcome (hand, or spin, etc.). In such a case, the house will win around 85% of the times, based on the fundamental formula of gambling.

You can replicate this experiment, O honest kokodrilo (big-time gambler). Here is what I did replicating what I believe to be the trick employed by the online casinos (or other virtual gambling sites). I chose as my winning outcome the 'heads'. I toss the coin up to three times in a row. If I win within three coin flips, I record a win (W); if I get 'tails' in all three tosses, I record a loss (L). I did it 3 times in rounds of up to 3 times 10. It was not necessary to perform 10 x 3 tosses per round, since I recorded a win in the 1st or the 2nd toss, and only sometimes in the 3rd toss. I recorded these results: 9W-1L, 8-2, 9-1. Very much what the Fundamental Formula of Gambling (FFG) proclaims. When the probability p=0.5 (or ˝), the degree of certainty DC = 90% that the event will occur at least once in 3 trials.

The blackjack probability for a basic strategy player is somewhere in the 48-49% neighborhood. The degree of certainty that the player will win at least once within 3 hands is about 85%. The degree of certainty that the dealer (the house) will win at least once within 3 hands is about 90%. Now we can see why the house wins so many hands when the bet is very high. The house generates three outcomes to choose from! If the cyber casinos were smarter, they would not generate all three (or perhaps four) hands (spins) at once. Generate one - if it's a winner, stop; if not a winner, then generate the 2nd outcome; if still not winning, then generate the 3rd hand (or spin, or other gambling outcome). Or, maybe the programming is more complicated!

At the maximum bet level, the Internet casino wins in a 90% proportion. That turns a 52-48 game into a 90-10 game! It defies mathematics - and I don't take it! If they are honest as they claim, why doesn't happen, at least once in a blue moon, that the player wins the maximum betting at a 90% ratio?

There is no doubt in my mind now. This is the trick the cyber-casinos or the slot blackjack machines are using. Read my real-life experiment at Caesar's Palace in Atlantic City, in the summer of 2003: The Philosophical Science of Winning and the Law. I recorded over 1400 hands at the blackjack slot machines. I also recorded the precise time of my real-life experiment, when I played with real money.

The random number generator could be totally fair, but the business software is used unfairly!

The way to assure integrity is to play with real money, from different computers (different IP addresses) using different usernames. Forget about “Big Million Accounting Firms”! Real play, with real money is the only way to test integrity in online gambling!

Please keep me informed. Please keep accurate records as well, as accurate as you can think of. It would be better to contact IGC and let them know your opinions.

Best of luck from Parpaluck!

Ion Saliu

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