But is it cheating? A new test for dishonesty

On reading their Judgement, there can be little doubt that 10 times World Poker Series Champion Phil Ivey had earned the reluctant respect of the Supreme Court Judges with his tenacity and ability. He had displayed stamina, attention to detail and an ability to calculate odds which a chess grandmaster would respect, yet underlying this was a question which required the minds of the highest judges in the Land to address; did he, and his fellow professional gambler/accomplice Cheung Yin Sun, cheat.

Phil Ivey and Cheung Yin Sun, over a period of two days at Crockford’s Casino, played a game called Punto Banco. It is supposed to be a game of chance. Casinos do their best to attract high rollers as it brings in punters. In the World of gambling, Ivey is Ronaldo. They pander to their quirks and requests, especially if the client believes something will bring them luck – after all casinos want people to believe in luck.

Unlike decks of cards available in shops, one cannot normally tell from the reverse of a deck of cards, which way up the card is and normally, knowing which way up a card is brings no advantage. In casinos, cards have plain backs or symmetrical patterns made, as in this case, of circles which of course have no up or down. After several hours, Ivey had requested that the ‘shoe’ from which several decks (with plain backs) be changed. He did this more than once and was losing. A new shoe contained cards with circles. Ivey was aware that when these decks are cut in manufacture, on one side, part of the circle may be cut and so it is possible to know which way up a card is.

The strongest cards in Punto Banco are 7,8 and 9 and players can back the player position or the bank position. Ivey said after the shoe had been dealt that he was winning at last and asked to keep the cards in that shoe as they were lucky. Neither player had touched the cards removing concerns that they could have been marked and so, as casinos want people to believe in luck, they agreed.

Cheung Yin Sun also had a request. When a hand was finished, would the croupier turn around the strong cards, the 7, 8 and 9s to face her – to turn her luck around. The casino agreed. So, it took a while and a number more deals but eventually the players knew that the cards with semi circles on one edge were the cards they wanted to place bets on.

Their bets increased with Ivey now placing six figure bets on a hand. By the time they finished he had won almost all hands and was seven million pounds up. His stake had been one million pounds.

However casinos do not pay out this sort of money immediately and they chose to investigate. From CCTV and audio recording, they worked out that the gamblers had deployed this ‘edge sorting’ technique and refused to pay, paying back only the original stake.

Ivey sued the casino. He was very open about what he did and did not believe he had cheated, a belief which the Court held was genuine. Rather he argued that he had exploited a weakness in the casino through skill and his actions were legitimate gamesmanship.

Lord Hughes, with whom the other Law Lords agreed, held that this was a game of chance and Ivey had entered into it as such. His actions however, in taking positive steps to fix the deck, using false claims of luck and superstition to achieve their ends, were those of a “carefully planned and well executed sting” and as such this amounted to cheating.

The case has far reaching implications though, beyond the World of gambling. It addresses the question of dishonesty and replaces part of a test which has been applied since 1982, known as the Ghosh Test, after a case of the same name.

Ghosh applied a two stage test. The first part is whether the jury think what the defendant did was dishonest according to the ordinary standards of reasonable and honest people. In criminal law this is an ‘objective’ test. If the answer is no, then the defendant is not dishonest and the charge fails.

If the jury answer the question yes, it was a dishonest action, before they can convict the defendant they had to apply the second part of the test. Did the defendant realise that reasonable and honest people would regard what he did as being dishonest? So the second part of the test is not of what the defendant personally thought, according to his own standards and considerations, but whether he realised what ordinary and reasonable people thought.

This had plenty of scope for confusion. The “ordinary and reasonable person” is a fiction. The jury have to draw on their own experiences, lives, and views. Many who have looked critically at this test give the example of Robin Hood which was referred to in the case of Greenstein. Robin Hood will, if legend is to be believed, have thought that he was genuinely doing good and right and that ordinary and reasonable and honest people would not regard what he did as dishonest.

For some time there have been calls to abandon Ghosh and for guidance in construing whether a defendant is “dishonest” and after the Judgement of the Supreme Court, this two stage test will no longer apply.

What we see now is a far more objective test where a prosecutor need only evidence to a jury the facts about what the accused did and thought in order to ask the Court to find dishonesty.

The abandonment of the second part of the Ghosh Test is one of the most fundamental changes in criminal law for a generation and which will have wide impact on cases of theft and fraud, where dishonesty is a central factor.