Numbers game - Policy Racket

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The numbers game, which is also known as policy racket, is an historical and illegal lottery game that is still played in the poor neighborhoods in U.S. cities. To play the game, the bettor tries to choose three or four numbers in the hopes that those numbers are the same which are chosen the next day.

To place the bet, the gambler pays a bookie and a runner then caries the money and betting slip between the bookie and the headquarters. The headquarters is also called the "policy bank" or "numbers bank". The term "policy" is a similarity to cheap insurance policy as it is a gamble on the future.

History

The Italian lottery began in 1530 and this game can be dated back to at least this time. Policy shops were already in the U.S. prior to 1860. In the early 20th century the game was already being associated with poor communities as individuals could play the game with just a penny. The ability to bet a small amount of money was a big draw to poor and low income bettors.

Another part of this game that attracted individuals was that bookies were able to extend lines of credit to bettors, which cannot occur in state lotteries. Since these games were illegal, bettors were able to keep their winnings and not pay tax on them. There were many policy banks that offered different rates, but it was common to find the payouts 600:1, with the odds of winning 1000:1. These odds created enormous profits for racketeers.

In the northeastern part of the United States, this game was referred to as "Nigger Pool", due to its presence in poor African-American communities. Italian neighborhoods found this game especially popular and Latin communities called the game "Bolita" or little ball. A report that was produced in 1875 by a select committee from the New York State Assembly stated that policy playing was is the lowest, meanest, worst form of gambling in the city.

Winning number

An early problem that was commonly faced in this game was the ability to find a way to randomly select the winning numbers. In the beginning, the winning numbers were selected by randomly selecting numbered balls or by spinning a policy wheel that has located at the local numbers bank headquarters. The results of the numbers selection were posted daily and often were "fixed". These rigged games were commonly used the cheat players and drive out the competition. One of the more common fixed games was using the published U.S. Treasury balance and selecting the last three numbers as the winning numbers.

Larger groups of gamblers were able to enter the same game as a result of having a central independently chosen number system which resulted in larger payouts. Bookies began using the "mutual" number when the treasury began rounding off the balance, which consisted of the last dollar digit of the daily total handle of the win, place and show bets at a local race track, which was read from the top to the bottom.

An example of the daily handle would be:

  • Win - $1004.25
  • Place - $253.56
  • Show - $27.61

The daily number would be 437.

In 1936, word had spread to cities like Atlanta that last digit of the day's bond sales on the New York Exchange were being used as the winning number.

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Legal version

There are many states today that offer similar "daily numbers' games that rely solely on machines to draw the winning numbers. The state typically takes 50% of the proceeds, rather than the 20 to 40% of the numbers game. The State of Pennsylvania even calls its daily lottery the Daily Number. Even though there are many legal alternatives to the numbers game, many individuals still prefer to place their bets with bookies. The typical reasons that gamblers prefer to play with bookies is that there are better payoffs, avoidance of income tax, ability to bet on bad credit and the ability to phone in the bet.