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This Blackjack Forum article reports on a 900 number telephone gambling scam.
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Reach Out and Fleece Someone--Telephone Gambling Scams

By Arnold Snyder
(From Blackjack Forum XII #4, December 1992)
© 1992 Blackjack Forum

Technology continues to oblige our laziness. The latest gambling craze to sweep the country is betting over the telephone lines. Short on cash? No problem. You don't even need a credit card. A functioning telephone will do. Just pour yourself a tall, cool one, sit back in your robe and slippers, and dial 1-900-SWINDLE.

Most states have strict laws against telephone "book-making." The penalties for operating a betting service by phone are stiff, and often include various charges of conspiracy and racketeering. Interstate bookmaking will bring in the Feds. Anyone taking phone wagers on horse races or sporting events had better be ready to fly by night if necessary.

A better idea, however, born of modern technology, would be to take bets via the new, legal, electronic method. This allows you to run your gambling operation with impunity, advertise on TV, and even hire celebrities to promote your business. No one is using this methodology yet to book sports or horse races, but it may be only a matter of time.

I don't know how long these legitimate(?) telephone gambling lines have been in operation because I don't watch TV much. Until Alison and I moved into this apartment building, as temporary living quarters while our home is being rebuilt, we never had cable TV. The first ad I saw for one of these operations was on a cable station; it was called "Spelling Bee," or something like that.

Here's how it worked, as well as I can remember: You dial the 900 number advertised and you will be given a spelling test over the phone. If you can spell 21 words correctly in 6 minutes, you win $1000. The fine print at the bottom of the screen informs you that you will be charged a few bucks per minute for the call. So, in effect, you are wagering $20 or so (depending on how much talking before and after your spelling test is necessary to transfer name\address\etc.) for the chance to win $1000.

Are you a good speller? How fast can you correctly spell on a touchtone keypad?


I'm willing to bet I could get out my Webster's Unabridged and easily find hundreds of words in the English language that would rarely all be spelled correctly by anyone: kilooersted, ouananiche, stannary, craquelure, thremmatology, uintaite, vitelline, miscible, pentaerythritol, narghile, yttrotantalite, zinziberaceous, zygapophysis, quinquereme, phthalocyanine, fissiparous, lophodont, gneissoid, xenodochium, tshernosem, pneumonoultramicroscopicsilicovolcanoconiosis. That's 21 words from my Webster's Encyclopedic Unabridged Dictionary of the English Language. Try them on your touchtone keypad. Six minutes.

To run an operation like this for maximum profit, however, the trick would be to keep players on the line for the full 6 minutes. You want to start with easy words, but long ones, so that callers stay in the game while charges are mounting. I suspect many players never even get to the truly difficult words. No mistakes. They just run out of time.

It's hard for me to view an operation like this as anything but a scam. Players may think they're wagering $20 to win $1000, but anyone dumb enough to think he can spell every word in the English language is more akin to a mark in a carny game than a gambler.

One of the most sophisticated telephone gambling operations currently running is Monte Hall's "Let's Make A Deal." Yes, that's the Monty Hall of TV fame. If you haven't seen the now white-haired Monte on TV lately, you must not be flipping through all 438 cable stations at 3 a.m. looking for hot TV gambles.

Here's how it works:

You call up Monte's 900 number, at a cost of $2.95 per minute, in an effort to win the $2000 grand prize. (The fine print on the TV ad informs you that the "average" call lasts 6 minutes.) Gee, thought I, for only $2.95 a minute I can play Let's Make A Deal with Monte Hall. A dream come true! I don't even have to dress like a gorilla in a tutu!

I couldn't resist. As soon as the ad ended, I reached for the cordless phone.

Alison tried to hold me back. "Arnold," she said, "Think of your reputation. You're a respected authority on gambling. If word gets around that you're playing Let's Make A Deal by telephone, you'll be ruined. This has got to be worse than keno, and it's probably worse than the California Lottery."

"It's all research and development," I defended myself, dialing 1-900-420-4544. (Yes, that's the real number. Try it!)

I was greeted by Monte Hall's recorded voice. There was a band playing. He was excited. It was just like TV! My first $2.95 was wasted answering personal questions - phone number, age, sex, and listening to various announcements, such as the Beverly Hills address where I could obtain a written copy of the rules of the game.

Then Monte Hall's recorded voice came on to get down to business. First, I had to correctly answer a question: "Which president was the Lincoln Memorial named after?" Monte quizzed me. I'm not going to tell you the correct answer, only that I answered correctly. (Okay, here's a hint: It's not Jimmy Carter. And, yes, he was one of the choices.)

Monte then informed me that because I had answered the question correctly, I could now choose between Door Number One, Door Number Two, and Door Number Three. Wow! Just like on TV! Using the touch tone pad as directed (all questions are entered via touch tone), I chose a door... Big fanfare!

I won!

"Yes," said Monte, "You've won a $15 bag of nickels, which we'll send to you in the form of a check! Or, you can trade in that bag of nickels for a chance to win $25 by choosing what's behind Door Number One, Door Number Two, or Door Number Three!" (Not verbatim, but you get the idea....)

I looked at my watch. I'd been on the line less than four minutes which meant that I was about three bucks to the good after subtracting my phone charges. I was tempted to quit while ahead. (I'm no gambler!) But I didn't yet know how to collect my prize. I figured by the time I got this information, I'd just be breaking even. I chose another door...

Another big fanfare!

I'd won again!

"Yes," said Monte, "You now have $25! Do you want to keep that $25 or go to Level Three, where behind Door Number One, Door Number Two, or Door Number Three there is $35?" He also reminded me again that if I made it all the way to Level Six, the Grand Prize would be $2000.

I looked at my watch.

Under five minutes.

I'm outta here.

As expected, another minute was wasted supplying me with my "Prize Code #" and the address where I was instructed to send a 3<$E1/2> x 5 inch postcard with my name, address, phone number, age and social security number, in order to claim my prize, which, I was informed, would take 8 to 10 weeks for delivery. Now, I must assume this operation is 100% legit, and that I will receive a check for $25 from Monte Hall in 8 to 10 weeks. This modest win, of course, will be offset by about $18 added to my phone bill.

But, let's analyze this game mathematically, assuming it's 100% legit. There are six levels of play, i.e., you must choose the correct door (one of three) six times in a row to win the $2000 grand prize. On the average, you will therefore win the grand prize once out of every 729 times you play (that's 36), assuming you don't quit early like I did.

Since the "average" call lasts 6 minutes, the cost of the average call is 6 x $2.95 = $17.70. 729 calls times $17.70 each = $12,903.30. So, in the long run you will win $2,000 for every $13,000(more or less) you spend in phone charges.

Alison was right. This is far worse than keno, and far worse than the California Lottery. Monte Hall's "house" has about an 85% advantage (a sizeable portion of which is shared with the phone company).

It's illegal to call a bookie and tell him you want to place a $10 bet on the 49'ers, yet it's 100% legal for you to call up Monte Hall (or the "Spelling Bee," or numerous other 900 number "games") and bet your money (disguised as telephone charges) on far riskier propositions. Nor would your bookie take 8 - 10 weeks to pay you!

I asked Nelson Rose (author of Gambling and the Law) how this type of gambling operation could be legal in California. He explained to me that the operator must either offer an alternative method of playing which does not require any 900-line charges, or the game must have a "skill factor" - such as requiring the player to answer a question. Hmmm... I wonder how many contestants were stumped by that Lincoln Memorial brainteaser?

Now, I'm not opposed to legalizing phone betting, but somehow the current regulations strike me as less than fair to the player. The funny thing is that it would probably be possible to set up a sports betting or other traditional type of book-making operation if it were operated as a 900-line game with "prizes."

In other words, if you cut the phone company in on your vigorish, then pass this charge on to your customers as part of the cost per minute for the call, and don't forget to come up with a "skill" question to legitimize the payoff, then you're a legal bookie! No illegal "bets" are made so long as it's all just telephone charges!

Your customers, naturally, won't like the lousy odds you'll be forced to give, and many will abandon you for illegitimate bookies who offer fairer odds. But paying off the phone company is simply the price of legitimacy in today's high-tech gambling world.

What I haven't been able to figure out, unfortunately, is a way to offer electronic blackjack games over the phone. As soon as I iron out the bugs in this brainstorm, however, I intend to give Monte Hall a run for the money. ♠

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  Technology Creates New Gambling Scams
Every day crooks come up with new gambling scams to fleece people out of their money. Now technology is bringing new forms of gambling scams. Arnold Snyder reviews a new 900-number telephone gambling scam.