For the Love of Loopholes

Nobody likes a cheater. But figure out a clever method for exploiting a loophole, and you’ll become the stuff of legend. Even when the perpetrator is doing something reprehensible (like Nobody likes a cheater. But figure out a clever method for exploiting a loophole, and you’ll become the stuff of legend. Even when the perpetrator is doing something reprehensible (like trying to dodge a DUI charge), you can’t help but marvel at a loophole-monger’s ability to think both inside and outside the box, to adhere to the rules while simultaneously sidestepping them. My prosecutor friend was clearly annoyed with the defense attorney, but there was a twinge of admiration in her voice as she described his machinations.
While the desire to avoid incarceration has spawned its fair share of lateral thinking, perhaps nothing has led to the discovery of more loopholes than the promise of cold, hard cash.

While the desire to avoid incarceration has spawned its fair share of lateral thinking, perhaps nothing has led to the discovery of more loopholes than the promise of cold, hard cash.

In 1983, for instance, unemployed ice cream vendor Michael Larsen discovered a secret about a popular game show of the time, Press Your Luck. The show featured a big electronic board that functioned as a roulette wheel. The player would set it in motion, let it spin for a few moments, and then press a big “stop” plunger. If it stopped on a money space, the contestant’s total would go up; if it stopped on a “Whammie” he’d lose his accumulated savings. Because the board was random, lucky players would risk maybe half a dozen spins, amass a couple grand, and then quit before they busted and lost everything.

But when Larsen appeared on the show, he pressed his luck no fewer than 45 times, without ever hitting a Whammie. The show’s producers were incredulous that anyone could be so ballsy (and fortunate), and they had every right to be. Larsen later revealed something that even the host of Press Your Luck didn’t know: the so-called Big Board was not random. He had taped countless Press Your Luck episodes on his VCR, and watched them until he could distinguish the six distinct patterns the Big Board would use. He’d even gone so far as to memorize all six patterns, training himself to always stop a spin where the money lay (and the Whammies didn’t). By the time he concluded his run, he’d racked up a total of $110,237—about 20 times a typical winning contestant’s haul.

Or take David Phillips, a.k.a. “Pudding Guy.” When he learned that the Healthy Foods company was offering its customers 1,000 frequent flier miles for every 10 Healthy Foods products purchased, he began searching for the cheapest item they sold; when he learned that Healthy Foods sold individual pudding cups for a quarter apiece, he purchased every one he could find within a 60-mile radius of his home, and even had his local stores order more from their distributors. (If this sounds familiar, it’s because Phillips’s astounding feat of loopholery was incorporated into the film Punch Drunk Love.)

In the end, Phillips wound up with more than 12,000 cups of pudding and 12 million frequent flier miles. He then gave the pudding to his local Salvation Army and wrote off its cost as a charitable donation.

Read more about the love of loopholes here:

The Morning News - In Praise of Loopholes, by Matthew Baldwin