It was 3am on the Fourth of July 1985, and a thirty-something year old man was slurping coffee and playing slot machines at a Denny’s on the Las Vegas Strip. Suddenly, some cops stormed in, grabbed him, and slammed him against the wall. From out of his pocket, they pulled a strange wire tool. The man insisted he used it to start his car, but the cops weren’t buying it.
Moments later, he was escorted away and charged with cheating slot machines out of cash. But that would only be the beginning, for this man, Tommy Carmichael, would go on to become one of the most notorious slot machine cheats in history. Let's investigate the wild story of Carmichael and the devices he used to swindle millions from Las Vegas.
Who Is Tommy Carmichael?
It all started on July 5th, 1950 in Tulsa, Oklahoma, when Tommy Carmichael was born. From a young age, he was fascinated by technology, always tinkering and trying to understand how things worked. By 1980, the thirty-year-old owned a TV repair shop, Ace TV Sales and Service, in Oklahoma.
Despite his knack for mechanics though, sales were slumping and the business was going nowhere. To make matters worse, he was going through a divorce. But his luck began to change when an old friend, Ray Ming, showed up. Ming came straight out of Las Vegas, where he lived in luxury, and wanted to show Carmichael the secret to his success. He pulled something strange out of his car’s trunk, a bit of old guitar wire and a metal rod curved like the number 9. To the untrained eye, it looked like junk, but this thing could rob slot machines blind.
In the ‘80s, the guts of slot machines were wired up to circuit boards, and when someone hit the jackpot, the circuit closed, activating the hopper’s motor to release coins for the payout. This is where Ming’s apparent “junk” came into play. It was actually a sneaky, if rudimentary, device called a top bottom joint. The “bottom” was made from a short piece of guitar string attached to a wire. It was slipped into the bottom-left corner of the machine to connect with the circuit board inside, drawing a tiny bit of electricity to get things started.
The “top” meanwhile was that metal rod, which was inserted into the coin slot. When used together, these two tools completed an electrical circuit strong enough to activate the hopper, causing coins to come tumbling out.
Carmichael was fascinated. He looked at his buddy Ming, who was living the life of Riley by cheating slot machines, while he was barely scraping by repairing old TVs. That was it, Carmichael made a decision that would change his life forever.
Slot Heist
He took the top bottom joint and began playing around, practicing on an old slot machine Ming had brought over until he mastered the perfect cheating technique. Then, he went to Vegas, and on his very first trial run, swindled $35 in nickels from a slot machine near the Las Vegas Strip. Thrilled by his success, Carmichael continued, and the results were insane. With this joint, which couldn’t be worth much more than a buck, he raked in a huge $10,000 over just one weekend.
After this, he began making regular trips to Sin City, leaving someone to look after his struggling shop. Each time, he returned to Oklahoma with his pockets full of money, only to find that his repair shop had made no money. Realizing where his fortune lay, Carmichael shut up shop for good and moved to Vegas, top-bottom joint in hand. And so began the rise of the most prolific slot machine cheat in history. If only he’d known where it would all end.
To avoid suspicion from casino owners, Carmichael spent the next 5 years constantly on the move, hopping from one casino to another across Vegas. With his top-bottom joint, Carmichael’s lifestyle transformed. His newfound money bought him new friends, and he began living large, attending extravagant shows, eating fancy dinners, and partying like never before. However, in 1985, casinos got wise to the top-bottom scam after a string of slot machine cheats were caught. To counter the fraud, slot machine manufacturers introduced something called slow blow fuses. Now, if any hoodlum tried sticking in a device like the top-bottom joint, the fuse would blow, immediately shutting down the machine and thwarting the cheat.
More and more casinos began installing these new and improved slot machines, leaving Carmichael with only a few old slots to exploit. As his options dwindled, it became increasingly difficult for him to operate without drawing suspicion. It was on Independence Day, 1985, that he ironically lost his freedom when he was arrested in that Denny’s diner mentioned earlier. He was sentenced to five years, but only ended up serving two. However, although he was on his best behavior, he had no intention of turning over a new leaf. While in prison, he befriended another crook, Mike Balsamo, and the two struck a deal: once they were released, they’d team up to form a slot-cheat gang and find a way to deal with these new machines.
Walking out of the prison gates in May 1987, Carmichael vowed to make Vegas his for the taking. It wouldn’t be easy, during his time behind bars, slot machines had become far more advanced. Leading manufacturer, Bally Technologies, had released brand spanking new slot machines equipped with computer chips and random number generator software, essentially turning them into video games and making Carmichael’s trusty top-bottom device a useless antique. To figure out these newfangled machines, he’d need one to test on, but that’d cost $1,000, some $2,800 today, and money was something Carmichael was now very short on.Another problem was that Carmichael’s parole required him to stay out of Vegas and return to Tulsa. To get around this, he made a deal with a Tulsa contractor who “employed” him as a construction site salesman. In reality, this was all a façade, Carmichael was secretly living in Vegas. Whenever he needed to check in for probation, he’d jump on a plane and fly to Tulsa. It was a clever scam, though it’s anyone’s guess what the contractor got out of it!
To raise funds for a slot machine, Carmichael teamed up with his old pal Balsamo, who’d also been freed from jail. With the TV repair shop out of the picture, they begrudgingly dusted off the top-bottom joint and went back to cheating old slot machines, even if it meant risking parole violations and returning swiftly to jail.
The Monkey Paw Device
By 1990, Carmichael and Balsamo had scraped together enough cash to buy the Fortune One video poker machine. For six months in his Vegas apartment, Carmichael worked tirelessly figuring out how it could be beaten. He tried every trick he knew to no avail.
Then, one night, a solution came to him as he slept: he saw the back of himself holding a tool in his hand, a simple strip of metal threaded with piano wire. When he woke up, he immediately got out of bed and set to work creating the vision he’d seen in his dream, something he called the "monkey paw."
© Be Amazed
The tool could be slipped up into the machine underneath its door. Once inside, the piano wire could be pulled taut or made slack, bending the metal and allowing for precise adjustments to its shape. Because of this maneuverability, Carmichael could accurately slide it into the payout chute and trigger a microswitch. This caused the machine to pay out, but because it didn’t know how much it was paying, it’d just keep going.
Once the invention was complete, Carmichael got to monkey business. Using the paw, he claimed he could make $1,000 an hour, earning money ten times faster than he ever had before. Coin bag in one hand, paw in the other, the scammer was back in the game.Nevertheless, Vegas casinos bolstered their defenses. In 1989, they started installing CCTV everywhere. It wouldn’t go down well if Carmichael was caught grinning into the camera! So, he started looking for specific machines where the camera’s sightline was obscured.
If there were none, he had another, even more nefarious tactic. Carmichael hired a bunch of goons known as “shades” to act as distractions, block security, and keep tabs on the latest slot machine technology. In return, they netted themselves 20% of his profits. Although, cameras weren’t the only roadblocks in the way.By 1991, slot machines had evolved again. Now they used electronic sensors to track the coins being dispensed, rendering even the monkey paw useless. These sensors worked by sending a tiny light beam across the coin chute to a receiver. When a coin passed through the beam, it was counted, and once the machine had counted the allotted payout, the flow of coins would stop.
But still, Carmichael refused to be defeated. To outsmart the casino owners, he decided to become one, sort of. In 1992, at the International Game Technology showroom, Carmichael posed as a potential customer interested in buying a slot machine. He casually asked an engineer how the machines worked and the man happily opened one up for him. From a quick glance at its mechanics, Carmichael understood exactly. In mere days, he created the "light wand," a simple device made from a camera battery and a miniature light bulb. When shone into the machine, the light from the wand would blind the sensor, causing it to lose track of how many coins were being dispensed.
So, you could insert $100 into the machine, shine the light wand inside, then immediately request to cash-out, and the machine would oblige. Only, because the light interfered with the sensors it would keep spewing coins far past the $100 you initially put in.
Safe to say, the light wand was a shining success! Though it only cost $2.50 to build, it could rack up to $10,000 a day! And, ever the profiteer, Carmichael compounded on his winnings by selling the device at an inflated price to other fraudsters. It wasn’t long before he was earning a fortune!But the problem is, people are unreliable, and stupid. Cheaters would often get their wands stuck in the machines and abandon them, leaving the suspicious devices for casino workers to find. As news of the whacky wands spread, slot machine manufacturers were prompted to introduce a new countermeasure, a delay in payouts. Normally, coins would pour out continuously during a payout, but the manufacturers added a short pause every six to seven seconds. If a cheater kept the light wand on through this pause, it interfered with the machine's sensor and it would shut itself down.
They’ve got Carmichael now! There’s absolutely no way he could outwit this new trick, but he did! He just gave the wand an on-and-off switch. Always one step ahead of the casinos, Carmichael was living it large in Las Vegas. His success afforded him two houses and he got himself a girlfriend, Lisa Luxem, a dancer at the Crazy Horse Too strip club who also acted as one of his shades. The fraudster travelled around the US, visiting casinos and working the slots non-stop. The guy even “worked” on vacations! In 1995, he went on seven cruises in six months and earnt himself thousands of dollars a day from the ships’ slot machines. He got away with all this scamming because, one, his technique was flawless and, two, he looked pretty darn average, making him practically invisible to security staff. For Carmichael, it seemed he’d truly become the king of the slot machines.
However, kings can be overthrown, and this one was finally getting picked up on the casinos’ radar. In October 1996 at the Circus Circus hotel-casino, Carmichael was doing his usual thing on the slots, but this time security noticed his suspicious behavior on their cameras and sent guards to investigate. They saw that while the coin count on Carmichael’s machine had stopped, money was still pouring out. But before they could grab him, Carmichael yanked his light wand out of the machine, flung it across the room, and bounced like a rabbit chased by foxes. In the end, he was caught, but crucially, without the cheating device. Security searched high and low and eventually found the light wand, before presenting it as evidence for Carmichael’s wicked deeds.
But the nice thing about being loaded is you can afford a good attorney. His lawyer argued there was no way to prove where the wand had come from. Was it really Carmichael’s, or someone else’s? And who’s to say the casino didn’t plant it on him? With no concrete proof, the charges were dropped. That guy must’ve had a good attorney! But surely they could at least arrest him for being in Vegas? That’s a clear violation of his parole from back in 1987! Well, his parole had expired back in 1992, so that ship had sailed. But this close call was only the beginning of Carmichael’s woes. His old pal Balsamo wasn’t being too careful with his own light wand, and in 1999 he got caught and turned over to the FBI. When looking through Balsamo’s phone history, they noticed one number kept popping up, Carmichael’s.
The Tongue Device
Together, the Nevada Gaming Control Board and the FBI launched an investigation into the underground cheating ring. They began spying on Carmichael and tapping his phone conversations, where they learnt that, not only was he one of the most influential slot machine cheats in Vegas, but he had yet another new invention, something he named “the tongue.”
After catching up with Carmichael’s light wand, slot machine manufacturers introduced a new defense: eliminating coin payouts entirely. In their place came "ticket-in, ticket-out" machines. Instead of pouring out cash, these machines printed tickets that winners could redeem later, and because there was no coin release, the wand was rendered useless.
However, the machines did still accept coins. Ever the engineer, Carmichael bought one, and after studying it, invented the tongue. It took advantage of a fatal flaw in the way the machine counted coins. When a coin was dropped in, it would pass by three light sensors that kept track of how many were being inserted. But Carmichael figured out that by sticking the tongue into the coin slot and moving it back and forth in front of the middle light, he could trick the machine.
Doing this made the machine think tons of coins were passing through, and in a matter of seconds, it’d be fooled into giving hundreds of dollars’ worth of playing credits! What’s more, one person could use the device to rack up credits, leave, then another person could come and collect them, making it super tricky to catch the perps. Carmichael shared his invention with his goons and told them to go out and test it, oblivious to the fact that their every move was being watched.With the tongue, Carmichael hoped to rack up about 35 credits a second and then cash them in. The gambler even dreamt of making $1 million in six months, after which he’d retire and leave his scandalous life behind. But, like all good cheats, he should’ve quit while he was ahead. Carmichael had become one of Nevada’s most wanted men, and the authorities knew full well about his plan for some last big scores. So, in 1999 the Nevada Gaming board came down on him like a sledgehammer. While on a trip to Atlantic City, the cheater was caught and arrested once more. Only this time, there was heaps of evidence to take him down with.
Armed forces from the gaming control board and FBI stormed his home in Rancho Bel Air, Nevada, and arrested his girlfriend too. As one of Carmichael’s shades, she was ordered to pay a $1,000 fine and sentenced to three months’ probation. By 2001, Carmichael admitted to
running an illegal gambling operation along with seven of his crew. Consequently, he was sentenced to 11 months in prison.
A lenient sentence, yes, but only on the grounds that he showed the authorities all of his inventions and explained how they worked. The great game was finally over. Throughout the course of his 20-year cheating career, it’s estimated that Carmichael and his team swindled an astonishing $5 million from casinos, somewhere between $8 and $12 million today!Not that it mattered in the end. After his release from jail, 52-year-old Carmichael found his cheating empire in ruins. To add insult to injury, in 2003, his name was added to the
infamous Black Book, a list created in 1960 full of people banned from stepping foot in any Las Vegas casinos. And once your name’s in the Black Book, getting it removed is next to impossible.
Nevada's black book by KTNV Channel 13 Las Vegas Carmichael’s old life was behind him, his money, his home, and even his relationship with Luxem had ended. So, he moved back to Tulsa, and believe it or not, tried to right his wrongs.Believing he was responsible for 90% of the cheating devices out there, Carmichael invented the Protector, an anti-cheating device for slot machines. He claimed this was the one device he’d always feared manufacturers would come up with. So, what was it? The Protector worked by shutting down the machine if any kind of light was detected inside, stopping tools like his infamous light wand.
In 2002, Carmichael sold the patent, which eventually landed in the hands of iGames Entertainment. The device was then approved by Nevada regulators and even purchased by Royal Caribbean Cruises to protect their casino slot machines. Not bad. These days though, it’s unlikely Carmichael’s protector is still in use. Slot machine technology has come a long way since the 2000s, with snazzy things like AI now built in to spot unusual behaviors or patterns. That said, there’re definitely people out there still trying to outsmart the slots!As for Carmichael, his tinkering days came to an end on February 1st, 2019, when he passed away aged 68. Back in the old days, he was asked whether he felt guilty about cheating the game industry. His answer? ‘No, I don’t…. With cards or live type gaming, it’s happening in front of you and you’ve got some kind of fair chance. When it comes to slots, you have no chance.’
Dennis Nikrasch
Of course, Carmichael wasn’t the only cheater out there. Meet Dennis Nikrasch, a simple 20 something locksmith in 1960s Chicago who’d go on to spearhead the biggest casino theft in Las Vegas history. Not that he would ever have guessed. Struggling to get by, Nikrasch began working for the Genovese crime family, breaking into cars, jewelry stores, and businesses.
But in 1968, he and his brother were caught using tools to steal coins from phone boxes in California and jailed for a year. After serving his time, Nikrasch packed his bags and headed to Vegas in the 1970s, where he used his lockpicking skills to cheat slot machines. He’d use a device not dissimilar from Carmichael’s monkey paw to crack the machine’s door open and activate its internal mechanism, triggering a payout.Wanting to up his game though, Nikrasch, like Carmichael, bought his own slot machine and began working out how to cheat it. Lo and behold, after some serious studying, he figured out how to both open the slot machine and activate the jackpot. We don’t know the exact details, and he’s not going to be spilling his secrets any time soon.
However, we do know he’d jimmy open the machine door, manually adjust the reels so they lined up for a jackpot, then close the door again. Only, because an alarm would sound if the door was open for longer than 5 seconds, he had to do all this unnoticed in less time than it takes many of us to tie a shoelace.
In this fashion, Nikrasch robbed Vegas casinos of a whopping $10 million between ’76 and ‘83. But in 1986, he got caught, again, and sentenced to 5 years in jail. So, once out, did he mend his ways and go back to a peaceful life? What do you think? When he was released, he found himself in a very different world. Slot machines had gone digital and cameras were everywhere.
But this old dog could still learn new tricks. Once his parole ended in 1996, he called on his old connections with the Genovese crime family and teamed up with a computer expert. Nikrasch bought another brand-new slot machine and, with his partner, started to figure out how to hack it. Hours of toil later, they thought they had a solution. These new machines relied on a computer chip to determine when a jackpot would be distributed. If they could create a similar chip encrypted with the proper coding to guarantee an instant win, they could theoretically use it to override the original chip and get a win every time! Taking things further than Carmichael ever could, they spent months creating their own chips specifically for this purpose.
Though similar to our modern chips, the ones Nikrasch would’ve been working with were slightly different. Nikrasch would insert them into the slot machine’s circuit board on top of the RAM. By "piggybacking" one chip on top of another, he was able to override the machine’s computer system and guarantee a jackpot.
Of course, it wouldn’t be so easy in an actual casino. To help his crazy scheme, Nikrasch assembled a team of shades to act as lookouts. First, they practiced in his garage, even setting up security cameras to figure out the best way of blocking the cameras’ view. Once they’d nailed this, Nikrasch was back in business. He’d head into casinos, crack open the slot machines, and insert his special chip. Then, he’d leave, and one of his shades would move in to play the machine and trigger the jackpot. To anyone watching, it would just seem like a lucky win.
From September 1996 to November 1997, Nikrasch and his crew pulled off 10 heists at six major Las Vegas casinos, winning both cash jackpots and cars which they then sold. The deal was that Nikrasch took 70% of the winnings, while the rest was split between all his blockers. Nikrasch should’ve known this wasn’t enough of a cut. In 1998, one of his shades got caught in Phoenix, Arizona. Without sufficient hush money, they ended up ratting out the entire operation. Nevada gaming forces searched Nikrasch’s home and found a whole heap of evidence to lock him away for good.
After being arrested, he was offered a deal to reduce his sentence if he spilled the beans on his method, but Nikrasch didn’t squeal. Instead, he pleaded guilty to charges of conspiracy, money laundering, and lots of other serious sounding stuff. In the end, the cheat was sentenced to seven and a half years in Nevada prison.
He was released in 2004 and passed away 6 years later, taking his secrets with him. One thing that hasn’t remained a secret is the amount of money he stole, an almighty $16 million. And that’s just the tip of the iceberg. In 1998, it was estimated that slot machine cheats like Carmichael and Nikrasch cost the industry $40 million a year, and more recent estimates have bumped that number upwards of $1 billion. If you were amazed at these Las Vegas cheaters, you might want to read about the
sneakiest fraudsters of all time. Thanks for reading.
