Re Meet Alex, the Russian Casino Hacker Who Makes Millions Targeting Slot Machines | WIRED

["Dave Farber" <farber () gmail com>]

Begin forwarded message:

> From: José María Mateos <chema () rinzewind org>
> Date: August 5, 2017 at 6:05:11 PM EDT
> To: dave () farber net
> Subject: Re: [IP] Meet Alex, the Russian Casino Hacker Who Makes Millions Targeting Slot Machines | WIRED
>
> On Sat, Aug 05, 2017 at 02:11:12PM -0400, Dave Farber wrote:
> > > > But Alex couldn’t just cash out as if he owned an ordinary startup because his business operates in murky legal 
> > > > terrain. The venture is built on Alex’s talent for reverse engineering the algorithms—known as pseudorandom number 
> > > > generators, or PRNGs—that govern how slot machine games behave. Armed with this knowledge, he can predict when 
> > > > certain games are likeliest to spit out money—insight that he shares with a legion of field agents who do the 
> > > > organization’s grunt work.
>
> For IP, if you want.
>
> This resembles very closely a beloved piece of Spanish lore, "los Pelayo" (the Pelayo family), who managed to win 
> around 1.5 million euros back in the 90s "just" by going around national casinos and studying physical imperfections 
> in the roulettes, which allowed them to study the bias in that analog pseudo-random number generator, thus predicting 
> outcomes in a way that allowed them to beat the system.
>
> I've just found this article that was published in 2012, when a movie about them was being made: 
> https://elpais.com/elpais/2012/04/16/inenglish/1334576944_755582.html
>
> ---
> Gonzalo is the patriarch of the Pelayo clan, a family who shot to fame in the 1990s for designing a statistical-based 
> method for winning on the roulette wheel. According to the family's estimates, they won some 250 million pesetas (1.5 
> million euros) between 1991 and 1995, mainly in the Madrid Gran Casino - their "greatest enemy" but also the 
> "laboratory" in which they tested their system. So Gonzalo and his son Iván wrote in La fabulosa historia de los 
> Pelayo (or, The fabulous history of the Pelayos), published by Plaza y Janés.
>
> Their discovery was accidental. Gonzalo had sent his nephew to the casino to learn the ways of the croupiers. He 
> wanted to study their "ways of dropping" in the hopes of determining a pattern in the path, bounces and final resting 
> place of the ball. His nephew took down numbers and dealers' names; Gonzalo analyzed the data on a program on his 
> computer. That was when he discovered that some numbers come up a lot more often than others, a tendency that had 
> nothing to do with the dealer and everything to do with defects in the manufacture and leveling of the tables. His 
> hypothesis: "If Swiss watches and NASA rockets have imperfections, then so do roulette wheels."
>
> [...]
>
> After his first few hypotheses on roulette tendencies, García-Pelayo formed a team led by his son, Iván, a recent 
> philosophy graduate and musician (he composed Africanos en Madrid (or, Africans in Madrid)). There wasn't anybody 
> over 26 years old in the first group. Though the figures and dates are now blurred, as often occurs in legends, after 
> a "few months" recording numbers and working with the data, betting began in earnest in the fall of 1991. According 
> to the book, they won close to "a million pesetas a day" in the first month. They played every day, from 5pm to 
> closing. "A blue-collar job, not at all glamorous, with 12-hour days," says Iván. "And on your feet the whole time," 
> adds his sister, Vanessa.
> ---
>
> "A million pesetas" -> 6000 euros.
>
> Cheers,
>
> JMM.
>
> -- 
> Will do Stuff for Stuff - https://rinzewind.org/blog-en
> De Ramen Cerebral - https://rinzewind.org/blog-es



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