Zues Yaghi - Alberta whistleblower faces 10M lawsuit from gaming company
Friday, October 27, 2006 | 11:30 AM MT, CBC
News
An Alberta man is fighting a $10 million lawsuit from an American
gaming company after he says he blew the whistle on casino
video slot machines that he alleges could be made to pay out on
demand.
Zues Yaghi, an Edmonton resident, said he has been the subject of a
search warrant, a gag order and a lawsuit from WMS Gaming
Inc. for reporting the flaws in its poker machines, which the
company has since fixed. WMS Gaming has its headquarters in Waukegan, Ill.
Yaghi said this week that the gambling public has a right to know if
machines have back doors, or secret mechanisms known as
Easter eggs, which could give some gamblers an advantage.
When he first discovered the design flaws, he said he was
appalled.
"I was angry. The first thing I was thinking, someone here
should be shot for this," he said. "That’s what I thought. You know,
somebody’s slipping aces."
In 1999, Yaghi went to the Alberta Gaming and Liquor
Commission to report the flaw, saying he found evidence of a secret door
that had been written into the computer software to allow players of
casino video slot machines to collect jackpots with a few simple
clicks.
Yaghi demonstrated to the commission how he could play the
video slot machines and win. He said he wanted to be hired to help the
commission fix the problem.
But instead of being offered a job or at least thanked for
being a good citizen, Yaghi was served with a rare form of citizen
search warrant by WMS Gaming, whose officials came to his door in
February 2000.
‘Big fat warrant’
"Knock on the door and I look and there’s a nice collection
of people that I haven’t seen before and they have a big fat warrant
to enter my premises," he said.
"It didn’t have a time limit on it. It just allowed them to
search and seize whatever they wanted which was relevant, or could be
relevant to WMS. For three days, they were coming back and forth."
A few days later, the company obtained a gag order that
prevented Yaghi from telling anyone how a player could get the slots
to pay out. And it filed a $10 million lawsuit.
WMS Gaming officials will not speak about the lawsuit. But
according to court documents, the company said it offered Yaghi
$50,000 as a reward and an incentive for him to keep quiet. The company
alleges in the documents that Yaghi asked for more money and refused
to be silent.
According to its annual report in 2001, WMS Gaming
reprogrammed its software to correct the problem that Yaghi found. That
didn’t stop U.S. regulators from fining the company for failure to
notify them about the problem.
The company has made peace with state and provincial gaming
authorities, including Alberta, by paying millions in
compensation for lost revenue.
It denies that any programmer deliberately designed a game
that could cash out on demand. And its lawsuit against Yaghi continues
in the courts.
WMS Gaming, a subsidiary of WMS Industries Inc., designs,
manufactures and markets video and reel-spinning gaming devices and
video lottery terminals.
It started out in the video lottery terminal business in
1991. The company created, manufactured and placed VLTs in
jurisdictions throughout North America. Once established in the video
lottery market, it moved into the casino gaming business with the
introduction of a video poker game. A year later, the company rolled out
a line of upright slot machines.
Copyright (c) CBC 2006
