
Improbably Frequent Lottery Winners - peterkshultz
https://www.cjr.org/watchdog/lottery-winners-foia-reporting.php
======
danso
That's funny to see this article. I remember an article about it -- also in
CJR -- when the original series broke in 2014 [0]. Looks like this article,
which is from today, is about other reporters taking it nationwide. Which is
great. One of the more confounding things (to me) about journalism is how a
great investigation in one state isn't done in another. Not by the reporting
team of the first story, but by any journalist in other states, because it's
easy "money", in the sense that you have a framework to copy/imitate, and if
there was a corrupt system in one state, there's likely to be something
similar in all the other 49 states. And it will still be "news" because of how
fundamentally different state laws and bureaucracies are. But then again,
sometimes newsrooms have a culture of not wanting to be seen as doing
something that has been perceived to have been done, even if it was by a non-
competitor (e.g. a non-Florida newspaper, in this case)

Seeing investigative efforts replicated nationwide not only makes for 50
unique-in-their-own way stories, that benefit 50 different jurisdictions. You
also get bonus meta-stories about states that are severe outliers, when the 50
are compared and contrasted.

[0]
[http://archives.cjr.org/united_states_project/palm_beach_pos...](http://archives.cjr.org/united_states_project/palm_beach_post_ferrets_out_florida_lottery_fraud.php)

------
fergie
Years ago I had a friend who's father made a living smuggling cigarettes (and
probably other stuff) from Northern Africa to Gibraltar. He laundered his
income by buying winning lottery tickets.

~~~
Too
Where would one find sellers of winning lottery tickets? You must either be a
store clerk or wait outside for people to cash them in?

~~~
dragandj
People who are genuine winners, for example? You pay them a premium for the
ticket.

~~~
Too
Yeah? Where would one _find_ genuine winners? It's not like there's an open
market for this, and since winners are random people they are unlikely to be
aware of black markets. Paying them a premium is obvious.

~~~
quuquuquu
Paying them a premium is not precisely accurate.

A $100,000 lottery ticket would in the US involve 30-45k in taxes for an
unmarried person.

So I bet it would probably sell for around $75,000 cash up front, which is a
decrease from the sticker price.

But if I was the winner, I would treat it as extremely shady and probably just
go the legit route for almost any price.

The US banking system easily detects large cash deposits under 10k even into
bank accounts, and then confiscates the money.

And I don't really want to keep $75,000 cash in my mattress.

~~~
ringaroundthetx
> The US banking system easily detects large cash deposits under 10k even into
> bank accounts, and then confiscates the money.

so you are conflating two concepts because first you are depositing $75,000 in
this example.

and no they don't confiscate it just because of that, they will freeze it
because of your poor explanation.

and if your explanation still sucks, the bank will unfreeze it and give you
your money but close your account.

it will appear confiscated if you can't accept your account being frozen and
argue the point, which will only raise more flags from more people in the
institution.

but if your explanation was good, and by good I mean generic, then you won't
encounter any problems.

the deposits over $10,000 will be reported to the government, but then its
just the government's problem, and if the transaction wasn't actually
problematic then you don't have a problem.

~~~
e59d134d
He is probably talking about Asset Seizure by government for unexplained
income.

~~~
ringaroundthetx
and he is also paranoid about it and conflating several concepts

------
aerovistae
In the book "Ringworld," an excellent work of science fiction that inspired
the setting of the Halo franchise, there is a character who was bred for luck
(as though it were a genetic trait) via a birthright lottery. The reasoning
was that those who won would be luckiest, and she was the descendant of 6
straight generations of birthright lottery winners. The character is
impossibly lucky all the time.

~~~
cpeterso
_Intacto_ is a Spanish film about people who can steal other people's luck.

[https://en.wikipedia.org/wiki/Intacto](https://en.wikipedia.org/wiki/Intacto)

------
rodrigocoelho
Never forget João Alves, the Brazilian politician who had won part of 200
lotteries, because, as he said, "God helped me, and I made money".

[http://www.nytimes.com/1993/10/30/world/new-government-
corru...](http://www.nytimes.com/1993/10/30/world/new-government-corruption-
scandal-leaves-brazil-stunned.html)

~~~
ghostDancer
In Spain politician Carlos Fabra won more than 2 million euros in several
lotteries, now is in jail and being investigated for corruption. It's famous
in Spain for that and for having built an airport that it's empty with almost
no flights at all.
[https://en.wikipedia.org/wiki/Castell%C3%B3n%E2%80%93Costa_A...](https://en.wikipedia.org/wiki/Castell%C3%B3n%E2%80%93Costa_Azahar_Airport)

------
projectant
Clarance Jones
[http://archive.boston.com/business/articles/2011/11/05/frequ...](http://archive.boston.com/business/articles/2011/11/05/frequent_lottery_winner_wins_again/)

TL;DR - Audited by IRS but had 200 boxes of losing tickets & records in
storage facilities, which the auditors apparently didn't want to search
through. He ended up winning his defense against the state's tax claims as
well.

How does he win so much? Is he psychic?

~~~
quuquuquu
Probably just caught a lucky break when they didn't want to search through the
20 boxes of duds he bought from 7/11 for less than the cost of paper ;)

~~~
monktastic1
Yeah but how did he win so much?

Edit: just read the article. Seems to be cashing in for others.

~~~
quuquuquu
Yup that's what I think too. Guy has a thing for lottery tickets as income.

Covered his tracks by keeping thousands and thousands of non-winning tickets
that he probably bought bulk for pennies per box.

Feds show up and see the boxes and say "shit, this guy must have really bought
300 million bucks worth of lottery tickets!" and walk away.

Pretty bad investigstion lol

~~~
curun1r
OTOH, he could be the front man for one of the lottery syndicates mentioned
in: [https://www.theatlantic.com/business/archive/2016/02/how-
mit...](https://www.theatlantic.com/business/archive/2016/02/how-mit-students-
gamed-the-lottery/470349/)

There have been lots of groups that have made lots of money by intelligently
playing specific MA lottery games at specific times, so those 300m tickets
might be real.

------
jmharvey
It's too bad the article doesn't go in more depth. There are a few plausible
explanations for why people claim an unusually high number of prizes:

1) Someone is buying a huge number of tickets, and just winning proportional
to the amount that they spend.

2) Someone is a "10 percenter." They buy winning tickets at a discount to the
prize amount, collect losing tickets that they didn't actually buy, and commit
blatant tax fraud by claiming "losses" that offset their "winnings."

3) Someone knows which tickets are going to win before buying them.

All three of these stories are interesting, but they're very different. Most
coverage seems to assume (2), but stops at "tax agency is incompetent at
detecting blatant tax fraud" without exploring why the tax agency is so bad at
what they do.

~~~
curun1r
Since the top claimant was someone from Massachusetts, I wonder if this [1]
has anything to do with it. Perhaps he's the person who cashes in tickets for
one of the syndicates mentioned in the story.

As an aside, the guy mentioned at the top of the story is named James Harvey
and your username is jmharvey...any chance you're him or did we just hit an
"improbable" coincidence :-)

[1] [https://www.theatlantic.com/business/archive/2016/02/how-
mit...](https://www.theatlantic.com/business/archive/2016/02/how-mit-students-
gamed-the-lottery/470349/)

~~~
jmharvey
As far as I know, all of those syndicates are out of business after the
lottery retired the Cash Winfall game. (And yup, that's me. I could probably
make my HN bio a little more explicit on this point.)

------
cyberferret
Persistence might be key? Some people may be addicted to gambling with lottery
tickets, or may just buy more than others in the same area.

I remember once early in my IT career, I was doing work for the local
government agency that was responsible for issuing all the 'scratch the ticket
and find 3 matching symbols' lottery games in our state. They used to sell the
tickets at the front counter of the agency office as well as various shops and
newsagencies around town etc.

While I was working on a PC in the manager's office, another manager came in
and said that one of the games had sold ALL tickets at the other retail
outlets, and that they had about a hundred $2 tickets left at their front desk
and the main prize of $1000 hadn't gone off yet.

When one manager left the room, the other manager looked at me and said "Well,
the rules forbid us from buying those tickets, but if you have a spare couple
of hundred on you, I'd buy up all those tickets at the front counter...". I
thought it was all a bit weird and didn't bite, but I found out later that a
friend of someone who worked there bought all the tickets, and sure enough,
won the $1000 prize in that particular game. Made me wonder how many 'friends'
of people who worked there were in on the old unsold ticket grey marketing?

Also while growing up, there was a family that lived down the road from us who
always seemed to win almost every giveaway competition in our town - free
TV's, food, whitegoods, airline tickets, you name it. One day I was actually
there visiting their son who was about the same age, and I noticed that their
mother was entering competitions almost as a full time occupation. She would
get various catalogues and our local newspaper and sit down with the kids
every afternoon cutting out and sending out coupons, competition entries and
sweepstakes all the time - they would have to be sending out at least 20+ per
day. Way to stack the odds in their favour.

They eventually left town in the most spectacular fashion - when Michael
Jackson did one of his huge tours of Australia, the family won a set of
tickets to see him in a sweepstakes, then promptly bought tickets for ALL of
his other shows in other states in Australia! This information got leaked to
the press, and Jackson found out about it, and ended up inviting this family
to Neverland in the US where 2 of the kids ended up staying for years.

You that old saying - you make your own luck. I think this particular family
lived it.

~~~
radicalbyte
As a parent you would have had to have been insane to leave your kids to live
with MJ, not to sure I'd call it lucky.

    
    
      This information got leaked to the press,
      and Jackson found out about it, and ended
      up inviting this family to Neverland in 
      the US where 2 of the kids ended up staying for years.
      You that old saying - you make your own luck.
      I think this particular family lived it.

~~~
cyberferret
Yeah, that was a whole other story. Initially, the family jumped to MJ's
defence in the local press, then when the lawsuits started happening, they
filed one too, saying that the son had been interfered with (!) - it was all
really surreal and odd. Lost touch completely with that family now - no idea
what they are up to, but I hope they lost that infatuation with winning prizes
and accolades and are happily settled somewhere...

------
nrmitchi
This post seems to be a summary of an entire series relating to 'Improbably
Frequent Winners'.

The first post of the actual series, which is a lot more in depth, is here:
[http://www.pennlive.com/watchdog/2017/09/defying_the_odds_pa...](http://www.pennlive.com/watchdog/2017/09/defying_the_odds_part_1.html)

------
cyberferret
I can't say too much, because they are a current client of mine, but I've been
doing work with a wholesaler for one of the biggest lotteries here in my
country, and they seem to have a LOT of customers who bulk buy lottery tickets
in what seems to be patterns.

I am talking hundreds of thousands of dollars of lottery tickets per week.
Their winning are also along those lines. I don't know about the industry, but
these sound like professional lottery players who check odds and play the
system much as they would the stock market. They probably have set systems in
place and complex prediction and statistical algorithms which ensures they win
just more than they lose?

I am thinking that 'pro' players such as these might skew the statistic for
winners to a large extent?

~~~
praptak
I don't believe that odds in favor of a player happen in lotteries, except for
rare 'bugs' in the game design, which are fixed as soon as the organizer spots
them.

A more probable explanation are addicts or money laundering.

~~~
lordnacho
> I don't believe that odds in favor of a player happen in lotteries, except
> for rare 'bugs' in the game design, which are fixed as soon as the organizer
> spots them.

[http://www.dailymail.co.uk/news/article-2183070/MIT-maths-
ge...](http://www.dailymail.co.uk/news/article-2183070/MIT-maths-geniuses-
netted-8million-Massachusetts-state-lottery-discovering-loophole.html)

If the game is badly designed, some smart cookie will find out and exploit it.

------
randomfrench
A possible rationnal explanation :

In France some scratchcard are sold to merchants in packages containing a
proportional number of winning cards. For example, on a lot of 100 cards,
sixty are null, 20 allows you to earn five euros, 10 allows you to earn ten
euros ...

So the cheat is easy for a merchant (or his complices) : he just needs
scratching each cards of a packages until find the maximum earnings. The
others cards are sold to customers.

[http://www.lefigaro.fr/actualite-
france/2008/11/26/01016-200...](http://www.lefigaro.fr/actualite-
france/2008/11/26/01016-20081126ARTFIG00526-tricherie-la-francaise-des-jeux-
perd-son-proces-.php)

sfmbe

------
Declanomous
I have trouble understanding how winning the lottery this often doesn't
immediately raise red flags for fraud. Is there some reason that people might
buy winning lottery tickets?

~~~
aetherson
The article suggests that people who owe back taxes or certain legal fees
would have their winnings garnished. So they find a "clean" ostensible winner
to claim the winnings, presumably paying him or her a smaller fee.

------
jimhefferon
I don't see that anyone has yet referenced this article.

[https://www.wired.com/2011/01/ff_lottery/all/1](https://www.wired.com/2011/01/ff_lottery/all/1)

It explains how to win (an old lotto), and more importantly why there is a way
to win.

~~~
eveningcoffee
Oh wow, I did not know that:

> _The North American lottery system is a $70 billion-a-year business, an
> industry bigger than movie tickets, music, and porn combined._

------
MarkMc
There is a bigger issue here: Why wasn't such an analysis done 50 years ago?
Where is the incentive for people to uncover fraud?

All governments should have a rule that says: if you uncover fraud or waste in
a government department you get 5% of the money that taxpayers save.

~~~
yorwba
Your proposed rule contains a great fraud opportunity: pay someone in
government to "accidentally" waste money and then "uncover" it to cash out 5%
of the waste.

~~~
MarkMc
That's a good point - to be honest I hadn't considered that. However,
government officials already have the opportunity to 'accidentally' waste
money by paying more than necessary for goods or services, then getting a
kickback from the supplier. Most likely the kickback would be more than 5%.

------
wonderous
Maybe their research should have also included a Google search of the
statistical unusual winners name in quotes plus the state name plus Lottery
winner:

For example, the most winning lottery winner in America was covered by the
Boston Globe in 2011:
[http://archive.boston.com/business/articles/2011/11/05/frequ...](http://archive.boston.com/business/articles/2011/11/05/frequent_lottery_winner_wins_again/)

[1] He's been on the radar as a ticket cashier since at least 1999 and has
been getting an IRS refund for his gambling losses since 1988.

~~~
ringaroundthetx
How does he do that? The IRS allows you to deduct up to the amount of your
gambling winnings, so you wouldn't get a refund, unless the state was
automatically withholding some of his winnings.

There is also the possibility that he set up a company that only engages in
gambling, so it can have a Net Operating Loss year over year.

------
jaclaz
On other news, most _probably_ Mr. Philip Stark ( a statistician at the
University of California, Berkeley):

[http://www.pennlive.com/watchdog/2017/09/defying_the_odds_ma...](http://www.pennlive.com/watchdog/2017/09/defying_the_odds_math.html)

calculated to be _implausible_ that on Hacker News he would be nominated by
someone in a same post with the quote from the Simpsons "Aw, people can come
up with statistics to prove anything, Kent. Forfty percent of all people know
that.".

Yet it just happened.

------
inetknght
I sincerely hope that the states would be willing to look at Oregon and
Florida's solutions to the requests. I actually also really like the CD being
issued, because it's a physical thing that you could take into court in
contrast to a web page (which often isn't quite as useful these days because
all of these fancy web apps) and know that it hasn't changed one iota.

It'd be better if it were a usb thumb drive if it's to be a bit more modern.

~~~
kijin
On the contrary, as someone who lives in a place where lottery winners are
allowed to remain anonymous, I find it bizarre that these states are willing
to give out such full information (even for winnings as small as $600) to
anyone who asks, not just to law enforcement investigating potential fraud.

The chance of your life getting ruined after winning the lottery is
proportional (among other factors) to the number of people who know that
you've suddenly landed a fortune and want a favor. I once read an article
about people who continued to live normally after winning the lottery. Most of
them only told a few people and tried not to draw attention. One man didn't
even tell his wife until he lost his job a few years later and had to explain
to her why she shouldn't be worried at all!

But that's going to be impossible if the state publishes your name and the
exact amount of your winnings for anyone to see. They might as well publish
everyone's tax records, too, including Trump's that everyone's been asking
for.

------
olivermarks
Maybe a more sophisticated modern numbers game with lottery insiders colluding
with 'winners'?
[https://en.wikipedia.org/wiki/Numbers_game](https://en.wikipedia.org/wiki/Numbers_game)

------
jaypaulynice
Of course there are ways to beat the lottery. For one, ask the clerk which
ticket to buy. They will gladly give you the one most people win from.

Also you can study the patterns. If you buy the same ticket over and over, a
streak of losing is a good idea that something big is coming (uneven
distribution of the odds). Most people at this point would give up and buy a
different ticket, but that's a bad strategy. A streak of winning small amounts
is actually bad (proper distribution of the odds). With a little social
engineering (small talks with other customers), you can gather that
intelligence. Evidence of this effect: the powerball, mega millions, etc. When
no one wins they balloon. When someone wins each time, they win relatively
small amounts.

Another mistake people make is buying different tickets instead of the same.
That's why only a few people win.

So much of lottery is reverse psychology.

~~~
jamiek88
No, not reverse psychology just you seeking and seeing patterns where there
are none.

There isn’t a strategy you can use as an individual unless you can throw tens
of millions at it to exploit basly designed games like the MIT guys did.

Your sad head shaking at those falling for reverse psychology is ironic.

~~~
jaypaulynice
Are you saying the evidence I provide is wrong? You seriously believe the
lottery is perfectly designed? That's like saying cars/airbags/computers/etc.
are always perfectly designed.

I found this example: [http://www.dailymail.co.uk/news/article-2183070/MIT-
maths-ge...](http://www.dailymail.co.uk/news/article-2183070/MIT-maths-
geniuses-netted-8million-Massachusetts-state-lottery-discovering-
loophole.html)

------
ryacko
it's possible, some people have gotten struck by lighting over a dozen times,
which in theory is as likely as winning the Powerball twice. (1 in 12,000
likelyhood of being struck over your lifetime)

~~~
everdev
Well, the lottery is supposed to be statistically random. If you live in an
area with lots of lightning and your job involves being outside up high with
metal you might be at an above average risk for getting hit. People aren't
supposed to have better chances of winning the lottery than the next player.

------
romeopov
Has anyone considered some of these people might be psychic? Professor Daryl
Bem's published study "Feeling the Future" comes to mind.

~~~
gboudrias
You're being serious? I don't mean to be overly hostile, but the implications
would be world-shattering and the "mundane" explanation is quite sufficient.
Also lottery-winning psychics wouldn't get caught.

~~~
romeopov
The mundane explanations doesn't answer anything. It's just pure speculation.
They didn't eben talk to the guy who had the most frequent wins. Why wouldn't
psychics get caught?

~~~
csydas
Well, let's assume for a second that psychics exist and know that they are
psychic. The second assumption is kind of important as if they just act on
impulse without knowing they're psychic we can't really differentiate that
from all the other chance winnings on a hunch.

For the Powerball, two ways to play: pick your own numbers or randomly
generate them. Would a winning psychic choose one over the other more often?
An ability to sense and know the future means they would have to either know
the winning numbers and pick them, know the machine that produces the numbers
(but not necessarily the numbers themselves), or somehow manipulate chance or
psychics so that the lottery machine produces the psychic's number during the
draw.

Psychic is kind of loosely defined right now by your question so for
convenience let's rule out the last one since that's more telekinetic/magic
than psychic.

With these conditions, we should see some pattern from the winner: they would
either always pick their own and get the winning numbers or they would always
happen to go to the right machine at the right time.

Both should show pretty consistent behavior on the part of a psychic, as we
can see that the bar for big winnings is pretty low ($600) and multiple
statistically improbable winnings would likely be investigated. (per the
atriclr, only 10 states do not investigate frequent winners).

So to summarize so far:

Frequent winners very likely investigated unless they are in the 10 states

Psychic will likely pick their own numbers

Psychic will go to a specific machine and have erratic pattern of purchase

If psychic are playing the lottery, my assumptions lead me to think that it
makes no sense to frequently win, instead banking on a single explainable big
win. This of course would be only if the psychic did not want to be found out
as a psychic, which for the purpose of the lottery I think would be a valid
want as I believe that there are rules about additional knowledge, etc meant
to catch people defrauding the lottery. Future-visions would most definitely
qualify, so probably would require that the psychic forfeit their winnings.

The mundane explanations do explain a lot, both from the investigations and
admissions from the frequent winners. To me anyways, the psychics, if they
exist, would more likely be the one time big winners, not the frequent ones.

~~~
projectant
Good points, but continuing with the thought experiment, I think you fail to
consider what might be a reality for your psychics. What if the psychics don't
have perfect information, nor perfect control, but have, perhaps varying on
the psychic in question, some amount of power that lets them see or control
future numbers with some amount of probability, but not certainty?

In that case, they might win more often, but not every time. Given that so
many things in nature follow a power curve or a bell curve, I think your
presumed psychic abilities, we can assume, follow the same curves, and if most
of your psychics then have "some ability" to predict these numbers, but not a
certainty, then I think they are more likely to be frequent smaller winners.

For example, if you have an ability that let's you see a 4/8 of the future
numbers, with 33% certainty, then one time out of three, you will win 4/8 of
the numbers, and sometimes more than 4/8 if you're lucky.

TL;DR -- your presumed psychic abilities probably exist on a spectrum ( bell /
power curve ) and likely most of your psychics do not have "perfect" future
information.

PS - I have a feeling that psychics would prefer to play the stock market,
than lottery. I just sense their expected payoff is higher in that case,
probably because there are a lot more factors that affect a stock price, so
even partial information across a lot of these seems to provide a better
advantage, than partial information on 1 single list of numbers.

~~~
csydas
That's fair. I certainly did forget to include the assumption that they would
have perfect clarity into their foresight.

I still think you'd see a pretty clear pattern emerge from winners however, at
least should the individual grasp the impact of their ability, even if the
picture is incomplete. I also agree stocks or sports betting would be a better
choice as partial information seems more valuable in those cases.

But I still feel confident you'd see the same general truths from psychics
with partial clarity; still picking numbers and never using random and still
an erratic purchase pattern as they chase locations and time. I think the
former would likely show more purchases with the same constant numbers from
the futuresight and then a spread of other numbers; such behavior may stand
out even more as there would be a history of them always getting a small
subset right and guessing the rest.

~~~
Retric
The most obvious difference would be people who picked their numbers would
have better winning than expected. Which is easy to check, but does not
happen.

