The story
Reportedly coined by Finley Peter Dunne (1867-1936) and expressed in dialect by his character "Mr. Dooley" in Mr. Dooley's Philosophy (1900), p. 260: "Thrust ivrybody—but cut th' ca-ards."
Etymology from Wiktionary, CC BY-SA 4.0.
trust everybody, but cut the cards
Today it means: One should have general faith in the good intentions of others, but one should never neglect to take appropriate precautions against being deceived or cheated. Full definition →