How a high roller took millions off three Atlantic City casinos without cheating

Mark Bowden's Atlantic article tells the story of Don Johnson, a high-rolling gambler who broke the bank at three Atlantic City casinos without card-counting or other "cheats."

Years ago, I was mildly obsessed with understanding casino economics and cheats, and read a bunch of books on how to win (or at least lose slowly) at a casino. The consensus among the experts I read was to realize that most skill-based casino games are only mildly "negative expectation" (that is, if you play them with perfect statistical strategy, you'll lose a little money over time). Also, most casinos distribute "comps" (freebies) to make up about forty percent of your estimated losses. These losses are calculated by pit bosses who keep an eye on consistent gamblers and observe the size of your normal bet and the tightness of your play, then make a guess at how much you're losing per hour, and multiply that by the number of hours you spend at the table (or at least, they did -- some casinos now use automated stored-value wagering cards that eliminate the need for estimation).

The secret to converting the negative expectation game to a positive expectation game was to trick the pit bosses. Play very slowly when the pit boss isn't watching, making the minimum bet on each hand and losing as slowly as possible. When the pit boss comes by to look, start playing fast and loose, and increase your bet-size. If the ruse works, the pit-boss will be tricked into comping you enough freebies to make your play pay, even if only by a little.

The problem with this method is that it means that you can get a "free holiday" in Vegas or Atlantic City only if you're willing to devote most of that holiday to standing at a blackjack table or video-poker machine playing hand after hand after hand, for eight or ten hours a day, playing with perfect, machine-like precision, making no mistakes at all (get the odds wrong and your profits can disappear in a single hand), in order to win a few nights in a hotel, show tickets, buffet passes, and some golf. Most people capable of that sort of consistent activity and focus can find gainful employment that pays substantially more than they'd earn at the tables and just buy the vacation outright, without having to squander their holidays trying to beat the house.

But Don Johnson went much further. As a high-roller, Johnson was often solicited by the big casinos to come and play at their tables. As the recession deepened, the offers got sweeter. They offered him "discounts" on his losses -- cash rebates of a fixed percentage of the money he lost at the tables. Johnson is also a monstrously focused, skilled blackjack player. So he would negotiate these excellent deals from the casinos, bring a huge stake with him, sit at a blackjack table, and play at high velocity, making zero mistakes, for extremely long stretches. With perfect, high-speed play, he could convert his small positive expectation -- thanks to the discount he'd negotiated with the house -- to multimillion-dollar winnings.

Sophisticated gamblers won’t play by the standard rules. They negotiate. Because the casino values high rollers more than the average customer, it is willing to lessen its edge for them. It does this primarily by offering discounts, or “loss rebates.” When a casino offers a discount of, say, 10 percent, that means if the player loses $100,000 at the blackjack table, he has to pay only $90,000. Beyond the usual high-roller perks, the casino might also sweeten the deal by staking the player a significant amount up front, offering thousands of dollars in free chips, just to get the ball rolling. But even in that scenario, Johnson won’t play. By his reckoning, a few thousand in free chips plus a standard 10 percent discount just means that the casino is going to end up with slightly less of the player’s money after a few hours of play. The player still loses.

But two years ago, Johnson says, the casinos started getting desperate. With their table-game revenues tanking and the number of whales diminishing, casino marketers began to compete more aggressively for the big spenders. After all, one high roller who has a bad night can determine whether a casino’s table games finish a month in the red or in the black. Inside the casinos, this heightened the natural tension between the marketers, who are always pushing to sweeten the discounts, and the gaming managers, who want to maximize the house’s statistical edge. But month after month of declining revenues strengthened the marketers’ position. By late 2010, the discounts at some of the strapped Atlantic City casinos began creeping upward, as high as 20 percent.

The Man Who Broke Atlantic City

(Image: A blackjack hand at the casino, a Creative Commons Attribution (2.0) image from Images_of_Money's photostream)


  1. What this article should tell you is that anyone who goes to Vegas and just walks up to a table is going to lose…the fact that this guy literally refuses to play unless they change the rules for him says it all.

    1. What, by telling you something like:

      “Johnson is very good at gambling, mainly because he’s less willing to gamble than most. He does not just walk into a casino and start playing, which is what roughly 99 percent of customers do. This is, in his words, tantamount to “blindly throwing away money.” The rules of the game are set to give the house a significant advantage. That doesn’t mean you can’t win playing by the standard house rules; people do win on occasion. But the vast majority of players lose, and the longer they play, the more they lose.”

      ‘cos they tell you that, verbatim.

    2. You would think that people realize that, but then I realize that I bought Mega Millions numbers today, so what the hell, right?

      The other thing is that this guy is really good at his game of choice. Even if the casino changed the rules for most people, they would not play well enough to really take advantage of it.

      1. You might as well tear up your tickets now, ChicagoD, because *I’m* going to win the Mega Millions.

        (interpret this as ironic, gambler-rambling)

          1. Well, the joke’s on both of us.  I lost and so did you.  Enjoy my $20 bucks, Mr. or Mrs. mathematical improbability.

          2. Your chances of winning are 1 in 176 million.  Whether you buy a single ticket, or a hundred tickets, your chances of winning are roughly the same. 

            Of course, you could buy all 176 million number combinations, and you’d walk away with quite a bit.

          3. Of course, you could buy all 176 million number combinations, and you’d walk away with quite a bit.

            Maybe not. Aren’t the odds that you’d be the sole winner (and thus not have to split the prize) something under 19%?

        1. I just went to the grocery store.  Weirdly, they had four registers open, but not the one with the lottery machine.  So people would crawl under the cordon and stand there until a manager walked over, keyed the register and sold them a ticket.  Then shut it down again.  Until the next person crawled under the cordon.

          I know nothing about gambling, but I do know that not selling tickets when the lottery is on the front page of every news site on the planet is a losing financial strategy.

          1. When I walked up to the register yesterday at lunch, the cashier guy said, “Let me guess… Mega Millions?”   A winning strategerie.  A winninger strategy:  “GET YOUR MEGA MILLIONS TIKITS HERE!!!”

          2. how much of a cut does the store take from the lottery anyway? i doubt that it’s very much.

          3. They get a cut if a winning ticket is purchased there. In this case, I believe that it would be substantial.

    3. It depends what you want from stepping up to the table.For example, every single time I got to a movie I’m guaranteed to lose at least $12. And yet I go and will continue to. So do you. (Probably.)

      For the same reason I still occasionally play a few hands of blackjack and roulette – Because I enjoy it. No mater how much money is gone from my pocket at the end of the night I’ll still be ahead.

      But expecting to get rich in a casino is as stupid as expecting to become famous from watching a movie.

      1. But I still don’t see what the enjoyment is in gambling.

        In the movie example you gave, when I pay whatever amount to see a movie in a theatre (assuming I actually still did this), it’s because I like watching Harrison Ford pretend he’s not at all concerned when in reality *gulp* he is, or because I can see Tom Hanks trying to survive against tough odds. I get something from this; the reward is entertainment. The payout in a theater is laughter, or a sudden scare when the killer (or just the cat) jumps out from the closet, or the thrill of seeing whether (and how) the hero will defuse the bomb in time.

        In blackjack and other gambling, it seems the sole reward is financial. The payout in a casino only occurs if I walk out with more money than I walked in with. Right? Where’s the enjoyment?

  2. The loss rebate is NOT how Johnson beat the casinos. Read the article again. The loss rebates never came into account, because he was WINNING. He beat the casinos because he got them to modify their rules to the point where he was effectively playing 50/50. The house edge was reduced to 1/4 of a percent. That is how he beat them, and any skilled blackjack player could have done it. The difference is most casinos won’t let a skilled blackjack player come in under those rules. Staying under the radar was the other factor.

    1.  That’s not how I read it.  Those loss rebates were exactly how he got the house edge so low (or in his favor in some cases apparently).  He didn’t just sit down and win every game, rather he played perfectly (taking lots and lots of losses) and over time his narrow edge over the house let him clean them out.  It’s easy to play perfect Blackjack, the rules are simple. 

      The real trick was convincing the pit bosses that he was a sloppy player and a high spender, which is how he got them to change the odds to his favor.  Once they did, he took them to the cleaners. 

      What impressed me the most is that he was able to do this more than once.  You would think the first Casino to be suckered by this move would report him to the other casinos the way they do with card counters.  A simple “do not offer loss rebates to this man” would have sufficed.  It has to be obvious after the fact what happened when you offer your sweetest loss rebate to some guy and he then cleans you out. 

      1.  Maybe casino A didn’t rush to tell casinos B and C that they just got cleaned out. Wait a little bit, and maybe the competition will also take a hit?

        1. I’m not sure what the play was there.  You would think word would get out that this guy was dangerous.  But there was a little more deception going on.  Obviously, he played  a very low profile as well as perfect BJ.  There is more to this story than we are reading here.

    2. The math gets messy, but the loss rebate actually is critical. With 1/4% house edge, you might leave up $100K 45% of the time and down $100K 55% of the time, for an expected loss of  $10K. But with a 20% rebate on your losses, you’re leaving up $100K 45% of the time and down $80K 55% of time, for a net gain of $1K. The times he won millions, the loss rebate didn’t factor in, but all the times he avoided losing an extra $20K meant that the million dollar wins weren’t just recouping his other losses.

  3. “As a high-roller, Johnson was often solicited by the big casinos to come and play at their tables. As the recession deepened, the offers got sweeter.”

    Sounds like a large part of succeeding is already being rich, then. I’m guessing the average gambler can’t duplicate this, partly because of Johnson’s expertise, but also because the amount he can spend earns him discounts that wouldn’t be offered to most people.

    1. I’m wondering if he himself was a marketing play, BY the casinos, to attract more would-be millionaires to stake their claim on the intellectual territory.  Recent years have given us a lot of lore on Blackjack, and the casinos, if they are wise, would capitalize on offering a glimmer of hope to all the people who think they are smarter than Matt Damon, Kevin Spacey or Jim Sturgess. (millionaires by different methods.)

      1. I assumed the same thing. They need big winners so that they can put their pictures in the lobby to sucker in all the big losers.

  4. Even putting “cheat” in quotes is saying too much– card counting isn’t cheating or “cheating.”  It is just being too good; gambling is an unethical system that preys on the vulnerable.  I’m not saying you need to criminalize it, I’m just saying– call a spade a spade.  If you are able to beat the system, they don’t let you play, since it isn’t about “playing,” it is about taking money from people.  If you want to gamble & have fun & say that the lost money is payment for entertainment, alright…that is the direction they are trying to spin it, but lets not lose sight of the mathematical abuses of the casinos, you know?

    1. That’s exactly right.  Being smart or talented is not a cheat. Thinking is not a cheat. Using quotes is like saying counting is cheating with a wink, and not really meaning it to be taken literally.  The problem is that only people already in the know understand the wink.   This is an article written for the general reader, not for blackjack experts, and for the general reader the wink is too subtle a cue to be understood, so it actually reinforces the casinos’ fiction that counting at blackjack is a cheat. 

      I can’t tell you how many times I have had to explain to people that card counting is simply playing well, just like playing the odds in poker, but they have gotten the message from the casinos that it is cheating and are unsure what to believe.  So it irks me to see a respectable writer inadvertently reinforcing the idea that some thoughts are illegal.

      1. Being smart or talented is not a cheat.

        Everyone with whom I’ve ever played a knowledge game seems to feel that I’m cheating because I remember what I learned in high school.

    2. Correction: casino gambling.

      There are forms of gambling that have leveled odds, they’re just not businesses.

      [edit] I guess I mean betting actually, gambling I suppose by definition is a gamble.

      1. Fair enough; I’m not actually familiar with the laws pertaining to, for instance, setting up a poker game among friends. Still, at that point, the old saw about paying for the entertainment becomes true, I think– if I’m playing poker with my pals, I’m…well, hanging out with my pals, at the very lease, even if I lose some quarters.

  5. I know you did the right thing and put “cheats” in quotes when you mentioned card counting – but it irritates me no end how casinos have managed to portray playing intelligently by the rules as a form of cheating – and how obediently newspapers echo their words.

    1.  I understand classifying card counting with the use of a tool as “cheating” – you’re bringing equipment into the game that is not part of the game. If I brought a step-ladder to a basketball game (or even a box to step up on and jump from) I wouldn’t be allowed to play with it. Or those awesome mechanical digigrade stilts either.

      Most games are about imposing artificial restrictions (aka the rules) on players.

      Card counting with nothing but a really good memory system isn’t cheating, any more than being really tall or having long arms is cheating at basketball. It might be an “unfair advantage” when you play with people who don’t have a similar advantage, but that doesn’t stop the US from destroying everyone else at Olympic basketball.

      1. As the article mentions, casinos have ways of picking up when you’re counting cards, even if you do it in your head, based on your playing patterns — and they’ll tell you to leave if they spot you. IOW, they treat it as cheating.

        1. They can refuse service to anyone. This is what makes it unfair. They lure you in with the expectation that win or lose they’ll let you play, but if you win enough thy won’t.

          If you were to lose 5 million through poor play would they ban you?

          So it isn’t about whether counting is cheating or not. It is about the fact that casinos have rules that let them define winning as cheating and refuse you service.

          1. Wikipedia says:

            In all parts of the United States, with Atlantic City being the sole exception, casinos may ban any player for any reason including card counting as long as the Federal laws against discrimination based on race, creed, sex, national origin, age, or physical disability are not violated.

            So…not a problem for Johnson, as he played in Atlantic City.

      2. You’re 100% right.  Card Counting without benefit of either tools (i.e. iPad or any other device that can count or track cards) or a confederate / partner IS NOT CHEATING (though the casinos would have the public believe otherwise).

        I was thinking of visiting one near here (Toronto) when the company I was working for announced a day trip a few years ago. I thought heck, why not and called the casino info line to ask about certain rules, number of decks, etc. .  Imagine my ‘shock’ to hear that even though they don’t call it cheating as such they’d still prefer that you don’t count cards when playing Blackjack or 21.

        In other words, please promise you’ll play like most of the idiots that walk in our doors. We’d rather you not know what you’re doing.

        Oh BTW, I’ve seen new high-tech shoes in use in Niagara Falls.
        If I understand it correctly, they essentially shuffle the decks on an on-going basis thus rendering card counting useless.

        I guess this proves that it’s likely the only gambling ‘system’ that works.

  6. This story is really not all that remarkable– it only looks impressive because of the scale of the numbers involved.  Divide the numbers down to bets you can afford (say $5-10, maybe) and see if the story is still interesting.

    Plus, it contains incomplete information.  He had a few good sessions… what about his other trips?

    1. The same goes for all types of gambling though, the more you bet the more you win, so with a huge bet you might only need to win once (although equally a loss hurts a lot more).

      But to some extent you’re right, with an unlimited supply of chips you can guarantee yourself a win anyway (much more modest of course), simply by doubling+n your bet each hand/spin/roll after a loss and quitting once you’ve won.  Of course you shouldn’t need to spend much to make this happen, but the more you’re spending the bigger the reward. I can’t imagine Casino’s are a fan of that practice though (and it wouldn’t take many losses to bankrupt yourself, but it’d be very unlucky); I’ve never tested them on it but its probably something in their list of things you can’t do.

      It does touch on the background a little, making out that he spent a lot of time working on his technique, rarely visiting casino’s, however he must have been losing money somewhere to get his label and the invites as a high-roller.  But by the sounds of it that was all part of the plan.

      1. The method of doubling your bet every time you lose until you win isn’t the winning strategy you think it is.   The casinos would be perfectly happy to have you use that strategy. 

        In THEORY it sounds like a winner, but it is reducing it to practice that makes all the difference, and in this case makes it a losing strategy.  The reason is that doubling your bets when you lose creates an exponential growth curve in the losing direction.  It doesn’t take long to either hit the table limit, or hit your personal risk limit.  If you use this strategy for any length of time, you are virtually guaranteed to hit your limit, and as soon as you do you’ve erased all your winnings, and dug yourself a hole that is at your maximum loss capacity, and you can’t get out of it because you can’t double anymore. 

        In the end, when you win, you win very small, and when you lose, you lose very big, because when you win you reduce your bet to the minimum, and when you lose, the doubling rapidly escalates your loss until you hit the limit.

  7. OK, let’s clarify some things here. 

    Card-counting, using your own grey matter and nothing else, isn’t cheating or “cheating” or whatever. Card-counting using a device of any sort is illegal in many, if not most, jurisdictions that have casinos in them, and people have been arrested for using them in casinos. No one can prevent you from simply using your own talents and skills to keep count, however, and the most that they can do is simply ask you to leave (with whatever you’ve won up to that point) and not come back, possibly not to any of their casinos if they’re a chain; you might remember the scene in Rain Man where precisely that happens. Casinos can also share that information with other casinos, as with the Griffin Book, one of the “black books” that casinos use (the other type is a list of organized crime figures that are officially banned from casinos in a particular jurisdiction by the local gambling board); one of the industries that is behind the development of face-recognition software is the casino industry, in order to spot known counters even if they use pseudonyms and disguises. 

    As much as they’d like to keep the real counters out, though, casinos also want to fish in the people who think that they can count, or have some other home-grown system, but can’t really make it work. These are people that either simply don’t know what they’re doing, or have practiced at home on a computer where it’s nice and quiet and they can concentrate, but lose track of the count in a casino where there are flashing lights and free drinks and good-looking dealers (of whatever gender seems to catch your eye) who smile and leave an extra button or two on their shirt undone, and if it seems like you’re keeping the count anyway they’ll swap out dealers so that they can redo the shuffle, or suddenly you’ll have someone really obnoxious come to the table and try to strike up a conversation with you.  And those are just the obvious tricks. Say it with me: if you can’t spot the sucker at the table…

    1.  On Wall Street, there are actual commodities. Casinos  have nothing but the bets! Actual things are but a hinderance to pure speculation.

  8. Why does the term “derivatives” flash before my eyes when reading about “discounts on losses”?

  9. What a wuss! I’ve been playing against standard European roulette rules for years and have generated a significant profit (relative to the bets – which are a fraction of this guys pot).

    My poker stats aren’t quite as healthy though, which is ironic really considering its not a game stacked against me, like roulette.

    Luck ay?

  10. Contrary to public opinion, casinos don’t make money from high rollers, they make money because of high rollers. Having someone playing three hands at once for hours at high stakes tables or pushing the max bet limit on crowded craps tables convinces OTHER unskilled players to raise their own betting or to not feel bad about gambling a ‘few more hands.’

    The result is that high rollers break even or make a small profit while the rubes playing nearby try to keep up with the action and end up losing more than he wins combined. That’s why every slot machine has a loud jackpot siren, whether it’s paying out a million dollars or a handful of nickels.

    The easiest ways to make money are to play the cheapest machines along the exterior aisles of a casino. They will always pay out best because wins amount to only a few hundred dollars and they are intended to bring in nearby spectators who see players winning. You can also do very well at the Vegas airport slots because the city wants your last memory before heading home to be a positive one.

Comments are closed.