The 10 Commandments of Online Gambling
Published on November 24, 2015
A couple of months ago I wrote a post titled “The 10 Commandments of Blackjack Gambling”. It was a fun post to write, and it occurred to me that a lot of people seemed to enjoy reading it. So I’m back with another 10 commandments post, this one specifically aimed at people interested in online gambling of any kind.
Like that last post, these aren’t really commandments at all—they’re actually just suggestions. But they’re good suggestions, especially if you want to maximize the amount of fun you’re going to have and minimize the cost.
Believe it or not, some online gambling sites are less than honest. I write mostly for a United States audience, and the U.S. government has made their disdain for the legality of offshore gambling sites clear. The companies who do business in that kind of environment are sometimes less than reputable.
Many online casino players worry that the games might be rigged. Online poker players worry that their opponents might be colluding. Sports bettors are probably the most comfortable dealing with an offshore site, but even they might have doubts.
But the real problem that gamblers face when dealing with an offshore book is how hard it might be to get your winnings. Online casino games don’t need to be rigged; they already have an advantage built in because of the rules and the odds. Online poker sites make their money by taking a percentage of each pot (the rake). They don’t need to cheat by sharing information with players.
But some of these companies HATE paying out withdrawals. Some of them just never pay. Others find excuses for delaying payments as long as possible. Often players will reverse their withdrawals before they’re processed in order to put more of it into action.
The best way to investigate the reputations of the online gambling sites you’re considering conducting business with is to spend some time reading reviews on the Internet. Not all reviews are created equal, though. Use some discernment when you’re reading them.
A lot of “review” sites are literally nothing more than collections of sales letters for the gambling sites in question. Don’t waste your time with these. It doesn’t take a genius to figure out whether or not a review is legitimate or not. Just ask yourself if it sounds like an advertisement or not. Real reviews list both pros and cons of a site. You can see examples of real, well-researched, and even-handed reviews right here on this site.
You can find examples of bogus reviews that are nothing more than advertorials in disguise by doing a quick Google search.
Another way to find out about sites before conducting business with them is to spend some time in gamblers’ forums. There aren’t a lot of active forums for gamblers on the Internet, but you’ll find real user experiences in threads at the ones that are active with little difficulty. Just append the word “forum” to your search phrase when Googling.
I’m not naïve. I understand that most readers who are interested in gambling online are more concerned with the risk of facing prosecution than they are with whether or not everything they do is within the letter of the law. That being said, you should always give careful thought to the risks you’re taking.
If you’re in the United States, you probably already know that online gambling is illegal in most states. In the case of sports betting, it’s illegal throughout the nation because of the Wire Act. But unless you’ve been hidden under a rock and haven’t been paying attention, you’ll probably also realize that enforcement activities always target the places taking the bets—not their customers.
But some states have more draconian laws than others, and even a tiny chance of being arrested and/or prosecuted might be more risk than you’re willing to take. For example, at one time, in Washington state, playing poker on the Internet was a felony. Even in states where online gambling is specifically illegal, gambling is usually just a misdemeanor.
So when you’re doing your analysis, look at both the chance of getting in trouble and the consequences if you do get into trouble. David Sklansky likes to multiply the odds of something by the benefit or drawback to get an expected value.
Here’s how you might calculate that:
Suppose you estimate that you have a 1% chance of getting caught betting on football games online, and if you do get caught, you face a fine of $5000. The expected value there is -$50, or 1% multiplied by the fine you face.
Further suppose that you expect to win $500 over the course of the football season this year on your bets. That’s positive EV of $500, and you subtract your negative EV of $50 to get a total of $450 in potential profit. Just looking at it from a purely mathematical perspective, this is a worthwhile risk.
On the other hand, that calculation doesn’t take into account some of the other factors. You might not want to have a misdemeanor gambling offense on your criminal record, for example. It could interfere with your ability to get a job somewhere. Or maybe someday you want to invest in a casino—good luck getting ANY kind of gambling license if you have a gambling conviction—even a misdemeanor—on your record.
You’re an adult. You’re going to make your own decisions related to the legality of your activities. But please, try to make an educated decision. My advice is to obey the law. If you decide to do otherwise, at least understand what laws your breaking and what the potential consequences are.
I don’t really believe that bonus abuse exists. You take advantage of a bonus, you fulfill the requirements, and you’ve done all right by the gambling site. But some websites have a less enlightened view on the subject. You should be aware of that.
Here’s how gambling site bonuses work:
Gambling bonuses are incentives for new players to sign up at an online casino, poker site, bingo site, or Sportsbook. The site matches a certain percentage of your deposit, giving you additional funds to play with. When I first started writing about the industry, the most common offer was to deposit $100 and get $200 in bonus money.
A bonus abuser doesn’t really intend to gamble. He has the math figured out so that he can take advantage of the bonus and mathematically guarantee himself a positive expectation. At its simplest level, someone might deposit $100, gamble until he lost $100, then withdraw his $200.
Of course, online gambling sites caught onto this strategy really fast. They instituted wagering requirements.
Here’s how wagering requirements work:
You take your deposit and your bonus and you multiply it by the wagering requirement. That’s how much you have to wager before you’re allowed to withdraw any money. So if the casino had a wagering requirement of 15X, and you had a total deposit + bonus of $300, you’d have to place $4500 in wagers before being allowed to cash out.
On top of that requirement, the casino also forbids bets on certain games. For example, blackjack played with perfect basic strategy might only have a house edge of 0.5%. It wouldn’t take a rocket scientist to figure out how to almost guarantee a profit on that game. If you wager $4500 on blackjack and lose 0.5% of it, then your expected loss is only $22.50. Even if you have a run of bad luck, your total profit would be in the $100 to $150 range because of the bonus.
But the casino’s not going to count wagers on blackjack.
Or video poker.
Or any other games with a super low house edge. Instead, they’re going to insist that you bet on slot machines, which probably have a house edge of at least 5%–probably more. That changes the math considerably. Instead of an expected loss of $22.50, you now have an expected loss of $225. Since the bonus is only $200, the casino expects to win money in that situation.
Here’s the thing though:
Most casinos don’t have a wagering requirement that low anymore. You’re a lot more likely to find a casino that requires 30X wagering requirements, making it mathematically almost impossible to show a profit after fulfilling the requirements. Sure, you might hit a $5000 or $6000 win on one of your slot machine pulls, but the odds are against it.
Why would I advise that you not abuse bonuses?
Because it’s a fool’s errand. The math is against you.
And even if you do get lucky, a lot of casinos will claim that you’re violating the “spirit” of the bonus even if you fulfill the actual written requirements. I think gambling sites that do this are borderline criminal. At the least, they’re unethical. There’s no such thing as a “spirit” of a bonus. They have requirements, and if you fulfill them, then you should be allowed to make your withdrawal.
If you can find an opportunity to get a positive expectation situation from an online gambling site, think about it carefully, and do a little extra research into the reputation of the site. It’s not uncommon for sites with solid promotional offers that sound too good to be true to renege on their bonuses even if you meet their wagering requirements.
Gambling, online or off, involves risk. There are no sure things when you’re gambling. So you should always gamble with money you don’t need for other purposes.
You’ve probably heard this before. It’s common advice. Never gamble the rent money, online or off.
But rent money means more than just literally the rent money. You should also avoid gambling with money you need to pay any of your bills, like utilities, child support, taxes, anything like that. You should also avoid gambling with money you need for groceries.
If you’re traveling, you should avoid gambling with money you might need to get to and from the airport, or money you might need for meals, or money you might need for lodging. Although I guess money you need for lodging qualifies as rent, doesn’t it?
Seriously, though—people who gamble with money they need for other purposes are demonstrating that they have a serious impulse control problem. Think about it. If you spent money you needed for rent on alcohol or drugs, most people would say you’re an alcoholic or an addict.
Do you really want to be a gambling addict?
One of the first steps in avoiding that fate is not gambling with the rent money.
Okay, so it won’t hurt anything if you try to count cards online. But it’s another exercise in futility. Most online blackjack games are dealt from a virtual deck that’s constantly shuffled. So you have no way to get an edge over the casino based on the changing composition of the deck.
Even in the so-called “live dealer” games, the dealers use continuous shuffling machines. The last thing an Internet casino is going to do is give an advantage gambler an opportunity to get an edge over the casino. Imagine how much money a dedicated online gambler could make if counting cards were possible.
In fact, almost all legitimate advantage gambling techniques are close to impossible online. You might be able to find a positive expectation video poker game if you look hard enough. Of course, in the cases of poker and sports betting, you can get an edge, but in the case of sports betting, if you’re winning too much too often online, you’ll have trouble getting the Internet sportsbooks to take all of your action.
Quitting while you’re ahead only works if you quit gambling forever once you get ahead. That’s because with almost all gambling activities, you’re betting with a mathematical disadvantage. That doesn’t mean you can’t win.
But it does mean that if you play long enough, you will eventually lose all your money.
So here’s an example of an effective quitting while you’re ahead strategy:
You go into the casino and bet $100 on black at the roulette table. You win $100.
That sounds like a dull strategy, and it is. But in terms of maximizing your chances of doubling your money when gambling, it’s not a bad deal at all. Your odds of winning that bet are 18/38, or 47.36%.
Compare that with your odds of doubling your money if you took that $100 and bet $10 on ten different spins. In order to double your money, you’d have to win all those bets.
To calculate the probability of winning 10 bets in a row, you multiply the odds of winning by every bet.
So you’re looking at 47.36% X 47.36% X 47.36% X 47.36% X 47.36% X 47.36% X 47.36% X 47.36% X 47.36% X 47.36%.
Would you rather have a roughly 47% chance of doubling your money, or a 0.003% chance?
The example of making a single large bet instead of a bunch of smaller bets is called a “maximum boldness” strategy. If you want the best chance of walking away a winner, then placing one bet on a near 50% shot is far better than placing multiple smaller bets.
On the other hand, if you’re playing a game where you have a slight edge, you benefit from a minimum boldness strategy. You want to bet as little as possible in order to preserve your bankroll. You don’t want a streak of bad luck to wipe you out before your edge kicks in.
In fact, this is exactly what the casino has done. In almost all their games, they have a small edge over the player. Since they have a (for all practical purposes) infinite bankroll, they can weather the wins from the players. And eventually they’re guaranteed their profit.
Card counters follow the same principle. They grind that small edge out until they’ve won a significant amount of money. Since a card counter is just a single person (usually), it can take a lot longer for the edge to kick in.
But for the recreational gambler, if you ever want to walk away from the casino a winner, you have to learn how to quit when you’re ahead.
Lives are destroyed every by addiction. And gambling has been proven to be as addictive as drugs or alcohol. Plenty of treatment options are available, too. You’re not stuck with a 12 step program unless that’s what you think might work well for you. There are multiple treatment modalities. What’s important is that if you think you have a problem, you try to get help for it.
Many websites offer free assessments in the form of a list of questions about your gambling habits. The idea is to determine whether or not you might have a gambling problem. I hate to say it, but if you have other impulse control problems, like drug addiction, alcoholism, or sex addiction, your chances of becoming an addicted gambler are probably greater than that of an average person. But even people with no history of any kind of impulse control problems can run into trouble.
Some examples of questions that one of these assessments might ask include:
There are more questions, and different sites have different assessments, but most of them look at how many of these questions you’ve answered yes to.
It’s common in 12 step programs for people who have recovered to say that an addict needs to hit bottom before he can get better. But from personal experience, I can share that you don’t have to take the elevator all the way down unless you want to. You can stop any time.
If you think you have a problem, please, get help before you lose everything.
One thing savvy gamblers notice about online casinos right away is that they all offer both single zero roulette and traditional American roulette. It’s almost comical, because there’s literally only one difference between the two games:
American roulette has a house edge of 5.26%, and single zero roulette has a house edge of 2.70%.
There is absolutely no good reason for you to choose the American roulette option now that you understand this fact.
You calculate your expected hourly loss at a casino game by multiplying your average bet size by the number of bets you place per hour, and then you multiply that result by the house edge.
Since both of these versions of roulette play the same way, your average bet and average number of bets per hour are going to be the same. The only difference is going to be how much money you can mathematically expect to lose per hour.
In an Internet roulette game, you can expect to play at least 100 spins per hour. Suppose you’re playing for $10 per spin. That means you’re putting $1000 into action each hour.
5.26% of $1,000 is $52.60. 2.70% of $1,000 is $27.00. Which one of those is the better outcome for the player?
Another good example is video poker. Many online casinos offer full pay (9/6) Jacks or Better. The house edge on that game, if you play with good strategy, is only 0.46%. That’s a far better house edge than you’ll achieve on any of the slot machine games at any Internet casino ever—by a factor of at least 10. Maybe more.
Suppose you’re an average slots player. You’re probably making 600 spins per hour at a dollar per spin, so you’re putting $600 per hour into action. A good slot machine on the Web probably has a 5% house edge, so you’re looking at losing $30 per hour on average.
If you switch to an online version of full pay Jacks or Better, your expected loss per hour drops to $3. That means you can get 10 hours’ worth of play on that game versus the slot machine game.
I understand that some people prefer slot machines to video poker games for various reasons. But it’s hard to argue with this mathematically compelling argument that you should at least consider video poker instead of slots.
You should also always avoid online casino game bets which have really a really high house edge. Examples of these include:
This doesn’t mean you can’t get lucky and win big money playing a casino game with a high house edge. It just means that if you want to get the most entertainment for your money, you should stick with the games and bets with the lowest house edge.
If you’re a low roller, you might not be able to get a better deal from a site. But if you’re bringing a significant amount of action to a gambling website, you can and should try to negotiate better perks for yourself. Contact their customer service department and ask to speak to someone about special offers for high rollers.
These extra perks could include things like higher deposit bonuses and/or rebates on your losses. These kinds of arrangements go on all the time in brick and mortar casinos. There’s no reason at all that you shouldn’t try to get as many perks as you can from an online site, too.
In fact, a lot of times all you have to do is ask. I used to play a lot of poker on the Web. I always contacted customer service at the cardroom to request a special bonus when I wanted to deposit more money.
I have one caveat though:
Don’t play above your bankroll in an effort to get more perks from the casino. That’s what they’re hoping you will do. But you have to be smarter than that. The goal is to get the most entertainment for money you would have spent anyway. It’s not to spend more money in the hopes of getting more perks and bonuses than anyone else.
In fact, most gamblers are going to lose every penny they deposit. The point of negotiating a better deal for yourself is to maximize the amount of fun you get in exchange for that cash.
Cheating at online gambling is an unlikely proposition at best. But at worst, it’s a ticket to jail and a ruined reputation. It’s pretty much impossible to cheat at online casino games, since they’re just random number generators churning out results. But you could theoretically cheat at other Internet gambling games.
Here’s an example:
In 2008, Russ Hamilton was consulting for Ultimatebet.com. He cheated other poker players out of millions of dollars. Not only did , but it also destroyed the business. Apparently there was a “god mode” that employees of Ultimatebet could toggle on and off. It allowed players to see everyone’s cards. It’s easy to see how that kind of knowledge could get you an edge. It’s also easy to see why such an activity would be completely unethical.
I feel like I need a shower just writing about it.
Here’s another, more recent, example:
In the last few weeks, a DraftKings employee used proprietary information to help win a contest at DraftKings’ biggest competitor, FanDuel. In fact, .
Here’s the problem:
These sites have been bombarding TV viewers with advertising, bragging about the legality of their business. That’s all well and good. I think people should be able to gamble anyway, and I think they have a legitimate argument that their business is perfectly legal.
But they’ve just waved a red flag in front of legislators and law enforcement.
He probably lost his job, and he definitely hurt his personal reputation. But he also began a chain of events that might result in the absolute destruction of his employer’s business.
That’s a bad outcome even if you did put $350k in your pocket by cheating. I don’t know anyone who can retire comfortably on $350k, do you?
At one time, boxing matches and other sporting events were notorious for being fixed by organized crime figures who wanted to make money illegally via betting on fixed games. This is a major federal crime. You don’t want to get involved in that kind of criminal activity, because the penalties for being caught are just too severe.
And of course, at the end of the day, you still need to be able to look yourself in the mirror. I’m not someone to judge other people’s ethics, but it’s been my experience that I sleep better at night when I at least try to do the right thing every day.
Gambling on the Internet can be a lot of fun if you stick with the suggestions above. It can even be fun if you ignore some of them. The ones you should pay the most attention to are the ones that can get you into the most trouble.
Don’t try to cheat. Don’t gamble with money you can’t afford to lose. Get help if you think you have a problem. Understand the legal risks.
There’s nothing wrong with gambling responsibly.
But you’ll have a lot less fun if you gamble irresponsibly.