GOOD POINT TB! To add... Michael wanted to put into Carlo's mind that Michael was offended by Carlo trying to fool him. Therefore, psychologically, Carlo believes that he must go ahead and confess (what Mike already knows) or his fate will be worse.

"From now on, nothing goes down unless I'm involved. No blackjack no dope deals, no nothing. A nickel bag gets sold in the park, I want in. You guys got fat while everybody starved on the street. Now it's my turn." (King of New York)