Accounting firm to audit lottery and provide results to committee
Following a disastrous couple of months for Tennessee Lottery, the legislature has decided to convene a meeting of the Oversight Committee and audit the lottery's operations.
Senator Bill Ketron and Representative Ulysses Jones are co-chairs of the committee.
According to a staffer in Senator Ketron's office, the committee has met several times in the past, mainly to discuss issues related to education and scholarships. The committee has not had to deal with managing errors or mishaps, until now.
Many committee members are new to the oversight body, following a shakeup in the legislature last year. The committee consists of 18 members — nine Senators and nine Representatives — and was chartered in the laws that govern the lottery.
The committee in its current configuration has not had any meetings in the last legislative session.
There was one event that committee members were invited to at Tennessee Lottery headquarters in February, but only three committee members attended.
One of the centerpieces of the meeting agenda in November will be the review of an audit that was order this week.
The accounting firm KPMG has been chosen to review the computer glitch that kept certain numbers from being drawn in the Cash 3 and Cash 4 games for more than three weeks.
The Tennessee Lottery is paying KPMG between $80,000 and $95,000 to perform an audit, said Kym Gerlock, lottery spokeswoman.
A software coding error kept duplicate numbers from being drawn in the two games after the lottery switched July 28 from a system where balls pop up with the winning numbers to a system using a computer to generate random numbers. So players who picked numbers like 4-6-6 for Cash 3 or 9-9-7-9 for Cash 4 had no chance of winning.
Gene Osekowsky, an occasional lottery player from Murfreesboro, said the audit was a good idea.
"We probably have mismanaged the program to some extent," he said of the new computerized lottery drawings, adding that he would like to see more consumers involved in lottery oversight.
A business analyst, Osekowsky said companies he worked for, such as General Mills, would test new systems in tandem with the old system for at least six months before switching. In that way, any kinks could be ironed out.
The KPMG audit is expected to be completed by Oct. 29, Gerlock said.
The audit results will be presented to a special legislative lottery oversight committee scheduled to meet sometime in November, said Sen. Jim Kyle, D-Memphis. Kyle said he was concerned because lottery money is used to fund college scholarships and pre-kindergarten programs.
"Those funds are not going to be available if there is not confidence in the lottery," Kyle said.
A poll being conducted at Lottery Post (www.lotterypost.com) shows that 93% of the respondents favor traditional ball drawings over the computerized drawings that the Tennessee Lottery recently put in place.
Many Lottery Post members have called for the Tennessee Lottery to switch back to the ball drawings.
"[The lottery] just switched to computerized drawings, so they would still have all the draw equipment and know-how on staff," explained Todd Northrop, CEO of Lottery Post.
"Unlike other states that would have to invest to switch back to real drawings, it would be simple and low-cost for the Tennessee Lottery," Northrop said. "They should do it immediately, while they still have the opportunity."
Other polls being conducted at the Lottery Post web site show that 73% of respondents would spend less money on lottery tickets if their lottery switched to computerized drawings.
Time will tell if that will happen in Tennessee, but concerned legislators are not taking any chances.
See the actual oversight committee announcement letter here: https://www.lotterypost.com/media/TLC_Announce_Oversight_Nov.pdf (Note: After sending the document, Senator Ketron's office sent a correction, stating that KPMG would be conducting the audit, not Ernst and Young.)
Lottery Post Staff, with excerpts from the Tennessean
Gene Osekowsky, said companies he worked for, such as General Mills, would test new systems in tandem with the old system for at least six months before switching. In that way, any kinks could be ironed out.
In this case there is nothing to compare RNG drawings are not related to mechanical ball drawings in that computers contain codes and balls don't whats to compare.
However had the Tennessee lottery ran their new RNG program for any duration of time i doubt they would know if the RNG program had any faults since they probably have no clue as to how they work. Other than some vendor saying the program will spit out random numbers.
Tennessee lottery personal couldn't catch a mistake without the players involvement in this. I wonder if anyone working there actually has an understanding of lottery numbers outside of drawing them. Meaning do they know anything about even, odds, repeats, doubles, statistics or any other aspects of the numbers group.
Suppose the RNG program had only spit out even numbers for 20 straight draws who working at the lottery would notice or even care that this was an improbability. Would any lottery personal even say anything to whomever is in charge.
What's happening at the Tennessee lottery goes deeper than their understanding of how numbers fall they have a RNG program that malfunctions and no one there know anything about how to fix it.
At least with ball drawings they can see a machine malfunction or when inspecting or testing the balls have some comprehensive knowledge of whats right and wrong with them.
They cant do that with RNG programs.
Lottery players don't want states to use computers to draw numbers we don't want any lottery to use computers that can have corrupted code or be manipulated in any way. Computers drawing lottery numbers is absurd. How is any player to know if the numbers drawn for any drawing were fixed or not.
Lets do away with computers drawing lottery numbers and stick with what has worked basically flawless for many years mechanical ball drawings.
What's to compare..... I am guessing that they are comparing the frequency count, type of # drawn (singles, doubles..) looking for any kind of bias in either RNG or ball drawings. I run all kinds of backtests on my algorithms so if a game is impossible to win enough to be worth playing then I won't touch it. TN is a small state; people can go to neighboring states and play there instead, right?
Quote: Originally posted by LckyLary on Sep 20, 2007
What's to compare..... I am guessing that they are comparing the frequency count, type of # drawn (singles, doubles..) looking for any kind of bias in either RNG or ball drawings. I run all kinds of backtests on my algorithms so if a game is impossible to win enough to be worth playing then I won't touch it. TN is a small state; people can go to neighboring states and play there instead, right?
i go to kentucky and georgia to play since they border tennessee. some people would have to travel over an hour to hit a neighboring state like one of the carolinas.
mississippi,arkansas and alabama are nearest to me so i'm pretty much screwed unless i drive to either texas or missouri which are both 3 or 4 hours away.all i can do is hope they bring the balls back because i'll never play the RNG ever.its cheating plain and simple.
Scientific Games Corporation
750 Lexington Avenue
New York, NY 10022
phone 212 754 2233
fax 212 754 2372
MARKET UPDATE
SGMS
DOW JONES
NASDAQ
S&P
35.75
+0.17
13766.70
-48.86
2654.29
-12.19
1518.75
-10.28
BOARD OF DIRECTORS
A. LORNE WEIL
PETER A. COHEN
GERALD J. FORD
RONALD O. PERELMAN
BARRY F. SCHWARTZ
ERIC M. TURNER
JOSEPH R. WRIGHT, JR.
MICHAEL J. REGAN
A. LORNE WEIL Director since 1989
Mr. A. Lorne Weil has been Chairman of the Board since October 1991, Chief Executive Officer of the Company since April 1992 and President of the Company since August 1997. Mr. Weil was President of Lorne Weil, Inc., a firm providing strategic planning and corporate development services to high technology industries, from 1979 to November 1992.
Previously, Mr. Weil was Vice President, Corporate Development at General Instrument Corporation, working with wagering and cable systems. Prior to that, he was a senior professional with the Boston Consulting Group.
[back to top]
PETER A. COHEN Director since 2000
Mr. Peter A. Cohen is a principal of Ramius Capital Group, LLC, a private investment firm. From November 1992 until May 1994, Mr. Cohen was Vice Chairman and a director of Republic New York Corporation, as well as a member of its management executive committee. Mr. Cohen was also the Chairman of Republic New York Corporation's wholly-owned subsidiary, Republic New York Securities Corporation. From February 1990 to November 1992, Mr. Cohen was a private investor and an advisor to several industrial and financial companies. From 1983 to 1990, Mr. Cohen was Chairman of the Board and Chief Executive Officer of Shearson Lehman Brothers. Mr. Cohen has served on a number of corporate, industry and philanthropic boards, including The New York Stock Exchange, The American Express Company, The Federal Reserve Capital Market Advisory Board, The Depository Trust Company, Olivetti S.p.A., Ohio State University Foundation, The New York City Opera and Telecom Italia S.p.A. Mr. Cohen is currently a director of Portfolio Recovery Associates, Mount Sinai Hospital, and Titan Corporation.
[back to top]
GERALD J. FORD Director since 2005
Mr. Gerald J. Ford has been a financial institutions entrepreneur and private investor involved in numerous mergers acquisitions of private and public sector financial institutions over the past 30 years. Mr. Ford served as Chairman of the Board and Chief Executive Officer of Golden State Bancorp Inc. from September 1998 until its merger with Citigroup Inc. in November 2002. Mr. Ford is Chairman and principal shareholder of First Acceptance Corporation, a retailer, servicer and underwriter of non-standard personal automobile insurance. Mr. Ford serves as Chairman of the Board and principal shareholder of Triad Financial Corporation, a privately held auto insurance company, headquartered in Huntington Beach, California. He also serves as a director of Freeport-McMoRan Copper & Gold Inc., McMoRan Exploration Co. and Affordable Residential Communities, Inc.
[back to top]
RONALD O. PERELMAN Director since 2003
Mr. Ronald O. Perelman is Chairman and Chief Executive Officer of MacAndrews & Forbes Holdings, a diversified holding company with interests in consumer products, entertainment, financial services, biotechnology and gaming. Among the principal interests of MacAndrews & Forbes are: Revlon, Inc., Panavision, Inc., Allied Security, TransTech Pharma, and Scientific Games Corporation.
[back to top]
BARRY F. SCHWARTZ Director since 2003
Mr. Barry F. Schwartz is Executive Vice President and General Counsel of MacAndrews & Forbes Holdings, a diversified holding company with interests in consumer products, entertainment, financial services, biotechnology and gaming. As General Counsel, Mr. Schwartz oversees and manages the legal function at the holding company and its operating entities. Prior to joining MacAndrews & Forbes in 1989, Mr. Schwartz was a partner at the Philadelphia law firm of Wolf, Block, Schorr and Solis-Cohen. His other corporate directorships include Revlon Consumer Products Corporation and Rev Holdings LLC.
[back to top]
ERIC M. TURNER Director since 2002
Eric M. Turner served as Senior Vice President of State Street Corporation, a financial services company, from 1996 to 2003. Mr. Turner was the executive director of the Massachusetts State Lottery Commission from 1992 to 1995. During his time at the Lottery Commission, Mr. Turner was elected to positions of Treasurer and Secretary of the North American Association of State and Provincial Lotteries, a professional association of 46 North American lotteries. In 1991, Mr. Turner served as Deputy Treasurer of the Office of the State Treasurer of Massachusetts. Prior to that time, he was employed with Drexel Burnham Lambert for approximately 7 years, last serving as Corporate Vice President, Municipal Finance Department, from 1989 to 1990.
[back to top]
JOSEPH R. WRIGHT, JR. Director since 2004
Joseph R. Wright, Jr. has been President and Chief Executive Officer of PanAmSat Corporation, a provider of global video and data broadcast services via satellite, since August 2001. Mr. Wright was the President of Terremark Worldwide, Inc. from March 2000 to August 2001 and was the Chairman of GRC International, Inc. from 1996 to March 2000. He was Executive Vice President and Vice Chairman of W.R. Grace & Co. from 1989 to 1994. Mr. Wright was a member of President Reagan's Cabinet as Director of the White House Office of Management and Budget (OMB) from 1988 to 1989 and was Deputy Director of OMB from 1982 to 1988. Mr. Wright is a director of AT&T Government Solutions, Titan Corporation, Proxim Corporation, Terremark Worldwide, Inc. and Verso Technologies.
[back to top]
MICHAEL J. REGAN Director since 2006
Michael J. Regan is a former Vice Chairman and Chief Administrative Officer of KPMG LLP, a leading provider of audit and tax services. Over his 40 years with KPMG, Mr. Regan was involved in a wide range of business activities, was lead partner for many Fortune 500 companies, and was head of the New York Audit Practice. He is a graduate of Manhattan College, where he is currently a member of the board of trustees, and served four years as a naval officer. Mr. Regan also sits on the Board of Allied Security Holdings, LLC.
Good story Mr. Northrop-
This Tennessee thing gets more interesting by the day....
Thank you, but that's op.
Sorry....
Gene Osekowsky, said companies he worked for, such as General Mills, would test new systems in tandem with the old system for at least six months before switching. In that way, any kinks could be ironed out.
In this case there is nothing to compare RNG drawings are not related to mechanical ball drawings in that computers contain codes and balls don't whats to compare.
However had the Tennessee lottery ran their new RNG program for any duration of time i doubt they would know if the RNG program had any faults since they probably have no clue as to how they work. Other than some vendor saying the program will spit out random numbers.
Tennessee lottery personal couldn't catch a mistake without the players involvement in this. I wonder if anyone working there actually has an understanding of lottery numbers outside of drawing them. Meaning do they know anything about even, odds, repeats, doubles, statistics or any other aspects of the numbers group.
Suppose the RNG program had only spit out even numbers for 20 straight draws who working at the lottery would notice or even care that this was an improbability. Would any lottery personal even say anything to whomever is in charge.
What's happening at the Tennessee lottery goes deeper than their understanding of how numbers fall they have a RNG program that malfunctions and no one there know anything about how to fix it.
At least with ball drawings they can see a machine malfunction or when inspecting or testing the balls have some comprehensive knowledge of whats right and wrong with them.
They cant do that with RNG programs.
Lottery players don't want states to use computers to draw numbers we don't want any lottery to use computers that can have corrupted code or be manipulated in any way. Computers drawing lottery numbers is absurd. How is any player to know if the numbers drawn for any drawing were fixed or not.
Lets do away with computers drawing lottery numbers and stick with what has worked basically flawless for many years mechanical ball drawings.
(from the above )
The Tennessee Lottery is paying KPMG between $80,000 and $95,000 to perform an audit, said Kym Gerlock, lottery spokeswoman.
Seems a bit strange to me!
I know if I had a shakey company, I would want to hire and pay the firm doing the audit.
The State of Tennessee is right on top of this mess!
ez
What's to compare..... I am guessing that they are comparing the frequency count, type of # drawn (singles, doubles..) looking for any kind of bias in either RNG or ball drawings. I run all kinds of backtests on my algorithms so if a game is impossible to win enough to be worth playing then I won't touch it. TN is a small state; people can go to neighboring states and play there instead, right?
i go to kentucky and georgia to play since they border tennessee. some people would have to travel over an hour to hit a neighboring state like one of the carolinas.
mississippi,arkansas and alabama are nearest to me so i'm pretty much screwed unless i drive to either texas or missouri which are both 3 or 4 hours away.all i can do is hope they bring the balls back because i'll never play the RNG ever.its cheating plain and simple.
you can add more PIGS to the dinner plate in Tenn. and many other state lottery's ;
CURRENT NEWS
Copyright ©2006
Scientific Games Corporation
750 Lexington Avenue
New York, NY 10022
phone 212 754 2233
fax 212 754 2372
BOARD OF DIRECTORS
A. LORNE WEIL
Director since 1989
Previously, Mr. Weil was Vice President, Corporate Development at General Instrument Corporation, working with wagering and cable systems. Prior to that, he was a senior professional with the Boston Consulting Group.
[back to top]
PETER A. COHEN
Director since 2000
[back to top]
GERALD J. FORD
Director since 2005
Mr. Gerald J. Ford has been a financial institutions entrepreneur and private investor involved in numerous mergers acquisitions of private and public sector financial institutions over the past 30 years. Mr. Ford served as Chairman of the Board and Chief Executive Officer of Golden State Bancorp Inc. from September 1998 until its merger with Citigroup Inc. in November 2002. Mr. Ford is Chairman and principal shareholder of First Acceptance Corporation, a retailer, servicer and underwriter of non-standard personal automobile insurance. Mr. Ford serves as Chairman of the Board and principal shareholder of Triad Financial Corporation, a privately held auto insurance company, headquartered in Huntington Beach, California. He also serves as a director of Freeport-McMoRan Copper & Gold Inc., McMoRan Exploration Co. and Affordable Residential Communities, Inc.
[back to top]
RONALD O. PERELMAN
Director since 2003
Mr. Ronald O. Perelman is Chairman and Chief Executive Officer of MacAndrews & Forbes Holdings, a diversified holding company with interests in consumer products, entertainment, financial services, biotechnology and gaming. Among the principal interests of MacAndrews & Forbes are: Revlon, Inc., Panavision, Inc., Allied Security, TransTech Pharma, and Scientific Games Corporation.
[back to top]
BARRY F. SCHWARTZ
Director since 2003
Mr. Barry F. Schwartz is Executive Vice President and General Counsel of MacAndrews & Forbes Holdings, a diversified holding company with interests in consumer products, entertainment, financial services, biotechnology and gaming. As General Counsel, Mr. Schwartz oversees and manages the legal function at the holding company and its operating entities. Prior to joining MacAndrews & Forbes in 1989, Mr. Schwartz was a partner at the Philadelphia law firm of Wolf, Block, Schorr and Solis-Cohen. His other corporate directorships include Revlon Consumer Products Corporation and Rev Holdings LLC.
[back to top]
ERIC M. TURNER
Director since 2002
[back to top]
JOSEPH R. WRIGHT, JR.
Director since 2004
[back to top]
MICHAEL J. REGAN
Director since 2006
Michael J. Regan is a former Vice Chairman and Chief Administrative Officer of KPMG LLP, a leading provider of audit and tax services. Over his 40 years with KPMG, Mr. Regan was involved in a wide range of business activities, was lead partner for many Fortune 500 companies, and was head of the New York Audit Practice. He is a graduate of Manhattan College, where he is currently a member of the board of trustees, and served four years as a naval officer. Mr. Regan also sits on the Board of Allied Security Holdings, LLC.
[back to top]