Let's do the math here. That company settled an $8M or $9M annuity for slightly less than $2M. If the winners had taken the lump sum to begin with, they would have gotten about $4M-$4.5M before taxes, about $3M after. The winners just got legally scammed for about a mil.

Lttleoldlady

True, but don't forget the subrtitle of the book:

One Man's Journey Through the Darkside of Lottery Millions 

I'm guessing that's the main theme of the book, offering people who did not choose a cash option lump sum payments "after the fact, greatly reduced lump sum payments. 

It would really be interesting if someone read this book and then hit a jackpot to see which payment they'd take. Or to have jackpot winners read this before they got any payment at all.

The business term for this is "Factoring" where accounts recievable are sold at a discount.  As with all things associated with a large amount of money you should get expert advise.

Hi folks.  I'm Ed Ugel, author of Money for Nothing.  I'm happy to see that the book has caught the attention of so many lotterypost members.  A few thoughts:

• You're correct, it's a tough, competitive business.  However, it's totally legitimate. 
• A winner would be well served have expert advice when they enter into a lump sum transaction.
• Remember, a million dollar jackpot is really only worth around 50% of the advertised win amount.
• Still, it's not as black and white as some making comments here think.  There are a lot of variables that enter into how much money a winner will get from the secondary market in a lump sum transaction.
• The industry does provide a genuine service to those in need of cash.  You've just got to know how to play the game in order to insure that you get to dollar for your annuity.
• Too many winners get themselves into financial hot water, thus putting themselves in a poor position to properly shop and negotiate their lump sum deals.

I hope some of you decide to read the book.  While it's obviously about the lump sum industry, it's also about my life over the past decade working with gamblers while, at the same time, being a gambler myself.  I wrote the book to tell MY story--one I think is interesting, cautionary, and (more than anything else) a lot of fun to read.  The world of lottery winners is just plain old interesting, riddled with contradictions and unique characters.  I hope the book shows what this little slice of life is really like.

I've been fortunate as the book was well reviewed in the USA Today, the Wall Street Journal, and the New York Times.  Folks seem to be responding to the humor in the book, which, to me, is the biggest complement I could receive.

 I'd love to hear your thoughts, especially once you've read it.  Please let me know.  I'm always around to answer any questions etc.

Cheers,

Ed Ugel

Hello Ed, welcome to LP.  Nice to get some additional input from the author.

As Ed's post notes, nobody got scammed. If somebody offers you $10 for something that may be worth $15 or $20 the options are  yes and no thanks, and it's your choice which one to choose.  As far as how much they may have lost, the payment is taxable income, so in your example it's the difference between about 2.6 to 2.9 million and 1.3 million, based just on federal taxes of 35%.

welcome  to LP Ed and good luck with your book sales