A pretended player at a gaming-table, or bidder at an auction, to lure others to play; so called because he blinds the eyes of his dupes, just as if he had struck their bonnet over their eyes.
“A man who sits at a gaming table, and appears to be playing against the table; when a stranger appears the Bonnet generally wins.” —The Times
Bonnet Braid Bonnet. The old Scotch cap, made of milled woolen, without seam or lining. Glengarry Bonnet. The Highland bonnet, which rises to a point in front.
He has a green bonnet. Has failed in trade. In France it used to be customary, even in the seventeenth century, for bankrupts to wear a green bonnet (cloth cap).
He has a bee in his bonnet. (See Bee.)
Source: Dictionary of Phrase and Fable, E. Cobham Brewer, 1894