Slot Cheat Bilked Casinos for Years

By: Associated Press
By: Associated Press

In the back of a strip mall workshop a slot machine sits on two green milk crates like a patient on an operating table, its electronic innards exposed.

Standing in front of the machine is 53-year-old Tommy Glenn Carmichael, who boasts a unique and lucrative talent:

"Give me a slot machine and I'll beat it."

Carmichael is no two-bit slot cheat. Authorities have anointed him one of the best, a master inventor who conspired with an elite group of thieves to steal millions from casinos.

For almost two decades, Carmichael designed tools — the kick stand, the monkey paw, the light wand — that enabled him to bilk slot machines across the United States and Caribbean.

Along the way, he fooled casino security as easily as he duped the machines. He was as elusive as triple sevens.

"A legend," convicted slot cheat Jerry Criner calls Carmichael. "He's the greatest mind as far as developing cheating tools."

Police don't dispute the superlative.

It's 1980. Carmichael is sitting in his Tulsa television repair shop called Ace TV Sales and Service when in walks his old friend, Ray Ming, then living in Las Vegas. Ming had something to show Carmichael.

In his car's trunk, Ming had a Bally's slot machine and a "top-bottom joint" — the Cadillac of cheating tools 20 years ago.

"We got to playing around," Carmichael said. "I could see where it was pretty easy to do."

Carmichael's knack for cheating had been discovered.

He immediately decided to close the repair shop. The lure of Las Vegas proved irresistible for Carmichael, whose thick brown hairstyle recalls a youthful Johnny Cash. The 30-year-old native Tulsan left with his fourth wife for Sin City.

He first bilked a 5-cent machine at a casino near the Las Vegas Strip, strolling out proudly with pockets bulging with $35 in nickels.

"You are thinking you are going to have yachts and cars," he said. "You know, the American Dream."

The Denny's restaurant just west of the Strip was practically empty at 3 a.m. on July 4, 1985.

After drinking a cup of coffee, Carmichael began playing a slot machine. Moments later police slammed him against a wall and searched him.

Inside his pocket was the top-bottom joint. He claimed it was used to start his car.

At 35, Carmichael's rap sheet now included his first cheating blemish to go along with two small-time drug convictions and some juvenile mischief. He was sentenced to five years.

"In the penitentiary there's not a whole lot to think about," Carmichael said. "You think about what you did and the mistakes and how to correct them. You either get straight or get better."

Carmichael got better.

"I was playing a dinosaur," Carmichael said, referring to the top-bottom joint. "Everybody knew about it. It limited where you could play."

Behind bars, Carmichael also met Mike Balsamo, who would help form a slot cheat gang. They agreed to find each other after their release.

But when freedom came in May 1987 — the same year he divorced for the last time — Carmichael found a technical revolution sweeping the industry.

Beginning in the early 1980s, the leading manufacturers, Bally and International Game Technology, rolled out new high-tech slot and video poker machines that used microprocessors and random number generator software. The old hybrid machines had relied on a combination of electricity and physics.

"It went from a machine to a computer game," said Frank Legato, an industry expert who writes for gambling trade publications.

The new machines that played catchy tunes and offered megajackpots also made it harder to cheat. People who attached quarters to strings or used slugs found their techniques outdated.

"They had to get more sophisticated," said Mark Robinson, former manager of the Nevada Gaming Control Board's Electronic Services Division.

In 1990, Carmichael returned to Las Vegas and bought IGT's Fortune One video poker machine.

For six months, he toiled over a device — known as the slider or monkey paw — trying to compromise the machine.

The slider — constructed out of spring steel and guitar wire — essentially snaked its way into the machine through the payout chute and tripped a microswitch.

That fooled the hopper, the bucket holding the quarters, into spitting out its payload.

"It was a smart idea," fellow cheat Balsamo said.

Carmichael's approach was simple, he said: "Figure out how a machine counts money and then work your way into the machine."

The slider enabled Carmichael to bank about a $1,000 an hour.

"The casinos were so asleep," Carmichael said. "I lived a nice lifestyle. You'd stop and move to the next machine. You could leave a whole room empty."

But the slider's effectiveness didn't last long, running its profitable course by about 1991. Improved slot technology doomed it.

"You can only ride a horse so far," Carmichael shrugged.

He went to the Las Vegas showroom of IGT, which dominated the industry. Posing as a customer, he inspected the inside of a machine, and an IGT engineer answered his technical questions.

"The second I opened it up, I knew how to beat it," Carmichael said. "He told me so much I thought he had called the law. I thought he was trying to stall us."

Carmichael bought one of the machines and in a matter of days invented a device dubbed a light wand.

"The light would shine in there and be so bright that the sensor would be blinded, causing the hopper to not realize it was paying out the coins," Robinson said.

The genius was in its simplicity: a camera battery and a miniature light bulb were its key components.

By about 1992, the device was defeating hoppers everywhere, and Carmichael was making thousands selling it to other slot cheats. Customers found Carmichael through word of mouth in the cheating underworld.

"It was overpowering," Criner said, claiming payoffs of $10,000 a day.

When IGT countered with a protective device called the Actuator Arm, Carmichael quickly obtained one. "It took us about an hour to beat it with 'the hanger,' " he said.

Carmichael believed he was on a roll.

"I really felt they couldn't make one I couldn't beat," he said.

He played almost every day — at casinos in Connecticut, Atlantic City, Colorado, Louisiana and beyond. He took cheating trips in his motor home and drove a Jaguar JX6. He had two houses and invested in a pawn shop. He always had a girl by his side and dutifully paid his taxes.

In 1995, Carmichael took seven cruises in six months, earning thousands a day from the ships' slots. He scammed casinos in Nassau, St. Thomas, San Juan and Aruba.

Helping him evade authorities were Carmichael's average appearance and his flawless technique.

"You could not tell" that cheating was going on, said Sgt. Jim Pflaumer, a detective with the New Jersey State Police Casino Investigation Unit.

After the cruise bonanza, Balsamo linked Carmichael with Ramon David Pereira. The trio worked with others, primarily "blockers" or "shades" as they're known in the business. They kept lookout while the principals cheated, and usually received about 20 percent of the take.

The three men formed the core of the group, carving up Las Vegas and establishing their own cheating routes.

Along the way, Carmichael was introduced to Lisa Luxem, a topless dancer at the Crazy Horse Too strip club who became his girlfriend. Their lifestyle was better than the movies.

"Our adventure would have made Ocean's Eleven seem boring," the 34-year-old Luxem said. "We had a blast."

Then everything changed.

On the night of Oct. 4, 1996, Carmichael sat in front of a slot machine inside the Circus Circus hotel-casino on the Strip. Flanking him were Luxem and another woman.

Unbeknownst to Carmichael, a surveillance camera eyed his every move. His movements had raised suspicions and security guards were dispatched.

Trying to run, Carmichael dropped a light device on the floor, but security recovered it. Police charged him with possession of a cheating device and manufacturing a cheating device.

The charges later were dropped, but in 1998, Carmichael was arrested in Laughlin on a similar charge — and the following year his luck ran out in Atlantic City, where he was stopped while using an improved light wand.

"I've been looking for you," Pflaumer, the New Jersey detective, told Carmichael. "Me and you have a lot to talk about."

A joint task force soon descended on the gang and arrested seven of them on federal charges. Informants had been supplying authorities with crucial information, and federal wiretaps recorded Carmichael and friends.

"The conversations were devastating," Las Vegas FBI agent Jerry W. Hanford said. "We couldn't have scripted them any better."

The eavesdroppers heard one alarming plan in particular.

Carmichael and Pereira were developing a device that could rack up about 35 credits per second on a quarter machine, and intended to perfect it on $5 slots.

They dreamed of grabbing $1 million over six months and retiring.

Agents feared the entire slot industry was in jeopardy.

"That's why we nabbed him when we did," Nevada Gaming special agent Bill Gamage said.

All seven eventually pleaded guilty. Carmichael admitted running an illegal gambling enterprise.

On Sept 7, 2001, Carmichael was sentenced to time served — 326 days — and given three years' probation. He lost his two homes.

And the judge ordered him to stay out of casinos.

These days, Carmichael can be found taking care of his elderly mother in Tulsa or tinkering on new gadgets in his nearby workshop. One of them is the Protector, an anti-cheating device that Carmichael is betting will make him very wealthy one day.

The design and patent application hang proudly on Carmichael's wall. He claims the Protector stops all known cheating devices.

Authorities are wary.

During a public hearing in February, the Nevada Gaming Commission debated whether Carmichael should be listed in the state's Black Book of people barred from casinos.

An industry in which gamblers wagered billions of dollars playing slot machines last year in Nevada casinos must be safeguarded, officials said.

"He says he has developed an anti-cheating device for slot machines," Nevada Deputy Attorney General Jennifer Carvalho testified. "However, that device can be readily converted to a cheating device."

The commission voted to put Carmichael's name in the book of cheats and crooks.

"They cannot stand the thought of me righting a wrong and possibly making a little money off it," Carmichael complains. He promises he's reformed. He'll never cheat slot machines again.

But if he wanted?

"I could beat them in a heartbeat."


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