Are Slot Machines Honest?
The short answer to this question is yes, slot machines are almost always honest since state gaming commissions make an effort to test them and confirm that they are. However, in the past certain manufacturers have been caught using computer chips that cheat the customer.
During the old days, almost all slot machines worked mechanically by using independent wheels that spun until they each stopped on a random symbol. Today's slot machines are light years away from those lumbering machines of old. These machines contain computer chips that are programmed to stop and choose numbers randomly. These numbers correspond to symbols which appear on the slot machine's video screen or to mechanical wheels programmed to stop on symbols based on the computer-generated numbers. The computer code that generates random numbers is responsible for whether the machine is "loose" or "tight," so gaming inspectors look at the machine's code to make sure that a slot machine doesn't cheat. That is, inspectors make sure that the machine pays off at the legal rate or at a better rate.
Because slot machines don't pay off with every spin, it's difficult for customers to tell whether a slot machine's chip has been programmed to pay off less often than is legally required. Inspectors look at brands of machines and their chips before they are installed in casinos, but they can't inspect each machine. Once inspectors approve a brand of machine, the manufacturers can make changes to individual machines as long as the changes fall within the legal bounds. Manufacturers can change chips to make a machine pay less as long as the inspectors have approved that particular chip.
There have been cases in which manufacturers have been caught installing illegal chips that affected payoff to benefit the casino. For example, the Nevada Gaming Commission caught American Coin using chips that did not allow poker royal flushes. Similarly, Universal Distributing Company was caught programming machines to show a "near miss" of a jackpot. The effect was two-fold: the machine didn't pay off, and customers continued to play the machine, thinking that they were very close to a big jackpot.
If you think you're playing a machine that is not honest, you can complain. Inspectors will initiate a response by pulling the slot machine's chip and checking it to see if it is an approved chip. Illegal chips are analyzed to determine their effect on the machine's payoff. Manufacturers that cheat are usually levied major fined or end up losing their license completely.