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N.C. collected record debt from lottery winners

North Carolina LotteryNorth Carolina Lottery: N.C. collected record debt from lottery winners

The North Carolina Lottery collected a record $1 million during the past year from prize winners who were also debtors.

The lottery scans big winners against a list of people who owe child support, back taxes, hospital bills and student loans. So as you dream about spending the piles of money you plan to win in the lottery, don't forget those bills you never paid.

The big collection comes in a record year for lottery sales, which topped $1.4 billion, a 10 percent increase from the previous year. And of the $835 million paid in prize money last year, $1 million is a relatively small amount. The debts can be as small as $50. Some are thousands of dollars. Lots of those winners are happy to finally be able to pay their debts.

"Many of them are relieved," said lottery Executive Director Tom Shaheen. "Hopefully they still get to walk out with some cash."

The lottery's debt program is similar to a program that allows governments and agencies to collect their debts through withholding from the state's income tax refunds. Lottery collections are tiny compared with those efforts.

In Wake County, phone calls from miffed lottery winners were a major clue that collections were up this year, said Susan Campen, an administrator in the county's revenue department.

"This is the first year we had calls of complaints," she said.

Debt owed to county and local governments accounted for the largest category of debts collected by the lottery last year. In 966 such cases, the lottery withheld $359,000 from winnings plus another $4,800 in fees to satisfy debts to local governments. In Wake County those most often came from vehicle property taxes, but could also be for real estate taxes or unpaid bills for ambulance trips.

Governments win

For local governments, the collections can help ease the pressure on already tight budgets.

Taking from lottery winnings is often more palatable to government officials because the money isn't coming out of wages or a tax refund, said John E. Whitehurst, a project manager for the Association of County Commissioners, who helped set up the debt clearinghouse that provides the database and does the collections for local governments. Still, winners can be shocked. Last year, one winner had $8,000 taken out of a $20,000 prize.

"That was traumatic, I'm sure," Whitehurst said.

Taxpayer information is confidential, and officials declined to name those who have had winnings withheld.

Some say the program doesn't go far enough.

More slipping through

Bill Brooks, president of the anti-lottery N.C. Family Policy Council, said he would support requiring screenings for customers who buy a certain amount of tickets at one time. "If they collect a million dollars, my guess is there's probably another $10 million out there more that could be collected or is probably owed by people who are playing the lottery," Brooks said.

Winnings of less than $600 can be cashed in at any lottery retailer on the spot. Tickets worth more than $600 must be claimed at lottery offices across the state. Those winners have their Social Security numbers run against a database of debtors.

Debts to the state's court system and UNC hospital system were also big categories for collections. Child support accounted for nearly $102,000 in 111 cases.

Sherry Bradsher, director of the state Division of Social Services, said it's unfair to assume that because someone owes child support he or she is a deadbeat.

"Perhaps you just got behind. There's a lot of different situations," Bradsher said, adding that many people might complain that anyone who owes child support shouldn't be buying lottery tickets.

"I understand those judgments, and we just encourage everyone who owes to pay," she said. "For those that won and owe, we're glad for the kids."

Thanks to M Fox for the tip.

News & Observer

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5 comments. Last comment 4 years ago by dopey7719.
Page 1 of 1
Avatar
Buford. GA
United States
Member #4
April 19, 2001
853 Posts
Offline
Posted: August 11, 2010, 12:33 pm - IP Logged

           I have a very successful engineer friend who WAS a dead beat

           dad. About 2 yrs ago Jules won $100,000 in some lottery

           promotion in Georgia. I went with him to p/u his $.......I almost passed

           out from laughing so hard when he walked out of that Lottery ofc with a

            check for a little over $6,000.....JUSTICE SERVED!!Wink

 "as long as you win more than you lose...gamblins' not a problem"

    jeffrey's avatar - moon
    Hamilton, OH
    United States
    Member #4162
    March 27, 2004
    277 Posts
    Offline
    Posted: August 11, 2010, 12:52 pm - IP Logged

               I have a very successful engineer friend who WAS a dead beat

               dad. About 2 yrs ago Jules won $100,000 in some lottery

               promotion in Georgia. I went with him to p/u his $.......I almost passed

               out from laughing so hard when he walked out of that Lottery ofc with a

                check for a little over $6,000.....JUSTICE SERVED!!Wink

    You have to pay to play, in more ways then you think. His kids won't have to live in poverty for a while. What a piece of work to owe that much for his kids. Man, do you want that kind of person for a friend?Mad


      United States
      Member #68713
      December 28, 2008
      301 Posts
      Offline
      Posted: August 11, 2010, 2:41 pm - IP Logged

                 I have a very successful engineer friend who WAS a dead beat

                 dad. About 2 yrs ago Jules won $100,000 in some lottery

                 promotion in Georgia. I went with him to p/u his $.......I almost passed

                 out from laughing so hard when he walked out of that Lottery ofc with a

                  check for a little over $6,000.....JUSTICE SERVED!!Wink

      In defense of this guy sometime the child their paying for isn't really their,not to say this was the case.Make sure your T's are crossed and I's dotted.Thumbs Up

        HaveABall's avatar - rocket

        United States
        Member #72448
        March 18, 2009
        951 Posts
        Offline
        Posted: August 11, 2010, 5:09 pm - IP Logged

        Well, the only thing I can think of being a shame is that, in the case of back property or income taxes or judgments, if the owed amount is withdrawn from the state lottery commission BEFORE it is paid to the lottery winner, that can ruin the winner's sincere plans to pay the fair amount of the debt.

        Perhaps the lottery winner's plan was to hire a consultant to negotiate DOWN the often OUTRAGEOUS interest charged.  It is a shame to win a large amount and not be able to pay to receive that valuable negotiation service.  Especially, if one is winning under $3 million net lump sum!!!

        Let It All Out

        Having millions of dollars in my financial accounts means more, consistent fun for me.Lovies

          dopey7719's avatar - Lottery-049.jpg
          Midlands, SC
          United States
          Member #69698
          January 14, 2009
          299 Posts
          Offline
          Posted: August 11, 2010, 10:12 pm - IP Logged

          I called the lottery office in South Carolina and they do it differently.  When a friend went to cash in 1000.00, she was scared since she owes so many medical bills and student loans.  Only, they didn't do anything but give her a check and it was a really quick process, so of course she didn't say anything! 

          I called the next day to ask what the law actually is and they told me that the state of SC only does a background check if the winning amount is over 5000.00.  Otherwise, they just cut you a check (minus federal and state taxes).