Clive Halford, Shane Howe and Joshua Owen were tasked with taking the money into bookmakers across the Black Country and playing the machines in an attempt to 'win' cash using the stolen notes.
As many as 40 bookmakers are thought to have been targeted in the Midlands.
Wolverhampton Crown Court was told yesterday that the £10 notes still had blue dye on them suggesting the money had been stolen. To thwart detectives finding out which raid the cash was taken from, the money was washed before it was used in the racket. It is not known who took the cash.
When police arrested 45-year-old Halford at his home in Heath Town, Wolverhampton, they found £2,000 of dyed cash.
Mr David Bennett, prosecuting, said: "A cashier working at Ladbrokes in Low Hill emptied a gambling machine. In there she noticed notes with blue dye on them. A total of 46 dyed £10 notes were discovered."
Mr Bennett told the court that £190 worth of dyed notes was found at a Ladbrokes in Church Street, Wolverhampton. Another £60 was found at Ladbrokes in Queen Square in the city centre. On February 27 this year two of the men went into William Hill in Low Hill. There were £190 worth of dyed notes in the machines.
Mr Bennett revealed evidence of the cash was found at William Hill in Coalway Road, Penn. On that occasion Halford and Owen, 21, had been in the betting shop. Halford and Howe, 21, struck at a bookmakers in Bloxwich while all men were involved in a scam at a betting shop in Coseley.
The court heard the men were caught on CCTV. They were arrested on March 15.
Halford, of Hobgate Road; Howe of Ridge Lane, Wednesfield; and Owen, of Old Fallings Crescent, Fallings Park, Wolverhampton, each pleaded guilty to a charge of conspiracy to convert criminal property.
Owen also admitted an unrelated charge of a burglary of a house in Pemberton Road, Coseley on June 2.
Halford was jailed for 12 months. Howe was given an eight-month sentence suspended for 12 months. He must also carry out 100 hours of unpaid work. Owen was jailed for three years for the conspiracy and burglary offences.