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Official wants fraud probe of Tennessee Lottery

Tennessee LotteryTennessee Lottery: Official wants fraud probe of Tennessee Lottery
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UPDATED (Aug. 28, 2007, 11:44 am) — Internal documents added

The Tennessee Lottery should investigate whether fraud was behind a computer malfunction that affected the results for Cash 3 and Cash 4 games, the lottery board's audit chairman says.

James H. Ripley, a Sevierville attorney who heads the 3-year-old lottery's audit group, said the agency should probe more deeply into why a computer software problem prevented duplicate numbers from being drawn for a three-week period.

"A lottery depends on its integrity, and so, you always want to rule that out,'' Ripley said in a telephone interview Monday. "I have seen absolutely no evidence of fraud at this point.''

Lottery officials announced Aug. 20 that a coding error had rendered their system incapable of generating duplicate winning numbers for Cash 3 and Cash 4 - such as 2-5-2 or 3-7-7-7 - for 23 days. Because of the glitch, players who picked numbers with such repeating digits had no chance of winning.

Those who picked single numbers had a higher chance of winning, however.

Tennessee lottery players no longer have the excitement of a real lottery drawing when they play. Now a computer picks the winning numbers.The glitch began on July 28, the day the lottery had switched to a computer-run system intended to draw random numbers, pushing aside the older method of using numbered balls drawn from transparent containers.

Ripley wrote to lottery director Rebecca Paul Hargrove last week asking for a probe to discover:

  • The nature of all human and machine errors that contributed to the failure of the system;
  • The identity of all the people who were responsible for the problem or who failed to prevent it, including lottery personnel and employees of New Jersey-based Smartplay International Inc., the company that sold the computer system to Tennessee for $221,200;
  • An analysis of whether the software error could have been inserted deliberately, and, if so, whether anyone profited by the improved odds for those who played single numbers;
  • A written account from Smartplay explaining the cause of the problem and why it was not detected;
  • An explanation for any delay in detecting or reporting the problem.

Hargrove said the lottery would get all of Ripley's questions answered. The agency's internal auditor is working on that now, said Wanda Wilson, the lottery's general counsel.

"We're going to look at all his questions and answer them the best we can," Hargrove said Monday.

James Berry, a Tennessee lottery player from Hopkinsville, Ky., said he didn't think anyone intentionally rigged the game, but that he was disturbed that his e-mails to the lottery pointing out the lack of double numbers did not appear to have been taken seriously.

Tennessee Lottery Director Rebecca Paul Hargrove heads the lottery that switched to computerized drawings

"They just wrote it off that I was crazy or something,'' Berry said. "I think they could have looked a little further."

Hargrove said she did not believe fraud was involved. She said a player would have had to spend $720 to win $500 in the Cash 3 game and $5,040 to win $5,000 in Cash 4, making it unlikely anyone would purposely rig the games.

"It just doesn't make any sense," she said.

She also said the glitch and the publicity about it had not hurt sales of Cash 3 and Cash 4 tickets, which were somewhat higher last week. The lottery has increased the prize money for those games.

Ripley said he planned to call a meeting of the audit committee in September, before the next board meeting in October.

Lottery officials have said the glitch occurred because of a computer coding error. A Smartplay employee typed in a "u" for "unique" instead of an "r" for "repeat" in the computer code, they said.

The error wasn't caught by another company that the lottery had paid $5,000 to verify that the new system was operating properly.

Officials with that firm, Gaming Laboratories Inc., have returned the money to the lottery, Hargrove said.

How to get your lottery refund

Players who picked duplicate numbers in the Cash 3 or Cash 4 games held from July 28 through Aug. 20, 2007, and have their tickets can get a double refund for each ticket or two free plays equal to the play amount on the ticket.

The deadline for refunds is Sept. 13.

You can get your refund by taking your signed tickets to a district office or by mailing them to Tennessee Education Lottery, P.O. Box 280360, Nashville, TN 37228-0360.

Locations of district offices are listed on the lottery Web page at www.tnlottery.com/howtoclaim/default.aspx.

Call Player Services at (877) 7TN-PLAY (786-7529) or 254-4946 for more information.

Internal documents

Letter sent to WKRN-TV complaining about the lack of doubles (DN83269821.pdf, 205 KB)

Internal memo requesting investigation (DN83931827.pdf, 1.56 MB)

Internal memo describing steps taken (DN83932827.pdf, 1.31 MB)

The above documents are in "pdf" format, which can be displayed using the Adobe Acrobat Reader.  (Click link to download the latest release of the reader.)

Tennessean

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28 comments. Last comment 9 years ago by Uncle Jim.
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jarasan's avatar - new patrick.gif
Harbinger
D.C./MD.
United States
Member #44103
July 30, 2006
5583 Posts
Online
Posted: August 28, 2007, 9:59 am - IP Logged

"Hargrove said she did not believe fraud was involved. She said a player would have had to spend $720 to win $500 in the Cash 3 game and $5,040 to win $5,000 in Cash 4, making it unlikely anyone would purposely rig the games."

This statement is about one of the biggest red herrings I have ever read. WOW.

Could you please elaborate and explain, how this has anything to do with rigging draws?

    Todd's avatar - Cylon 2.gif
    Chief Bottle Washer
    New Jersey
    United States
    Member #1
    May 31, 2000
    23275 Posts
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    Posted: August 28, 2007, 10:32 am - IP Logged

    "Hargrove said she did not believe fraud was involved. She said a player would have had to spend $720 to win $500 in the Cash 3 game and $5,040 to win $5,000 in Cash 4, making it unlikely anyone would purposely rig the games."

    This statement is about one of the biggest red herrings I have ever read. WOW.

    Could you please elaborate and explain, how this has anything to do with rigging draws?

    That's a GREAT POINT!

    Why would she even entertain the idea of rigging the drawings is computerized drawings were "so secure"?

    I would say if someone WAS rigging the drawing that they succeeded nicely.

    I wonder if that person would made the "keypunch error" played any Pick 3 or Pick 4 numbers during that stretch -- or maybe someone they know did?

     

    Check the State Lottery Report Card
    What grade did your lottery earn?

     

    Sign the Petition for True Lottery Drawings
    Help eliminate computerized drawings!

      duckman's avatar - ducklogodrake64x64
      Jacksonville Florida
      United States
      Member #23018
      October 6, 2005
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      Posted: August 28, 2007, 11:14 am - IP Logged

      I doubt it was an intentional error or fraud. Most likely it was the result of a software person making a change (or setting an parameter incorrectly) and then making the MAJOR MISTAKE of not TESTING the system after the change.

      A SIMPLE software test would have caught this problem. By running a trial statistical sample and looking at the results, it would have been obvious that something was wrong when number combinations had 0.00% hits.

      Either way, fraud or an unintentional mistake, this points up a major problem with computerized drawings...

        Todd's avatar - Cylon 2.gif
        Chief Bottle Washer
        New Jersey
        United States
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        May 31, 2000
        23275 Posts
        Online
        Posted: August 28, 2007, 11:47 am - IP Logged

        The story has been updated.  I have added three internal documents showing the complaint, actions, and summary.

         

        Check the State Lottery Report Card
        What grade did your lottery earn?

         

        Sign the Petition for True Lottery Drawings
        Help eliminate computerized drawings!

          KyMystikal's avatar - 1457224010054
          Florence, Alabama
          United States
          Member #8658
          November 13, 2004
          1993 Posts
          Offline
          Posted: August 28, 2007, 12:42 pm - IP Logged

          The story has been updated.  I have added three internal documents showing the complaint, actions, and summary.

          The Tennessean contacted me about doing a editorial about the Lottery mess but I don't think I will do it because I don't have time.

          I love doubles and remember, it's just a game!!!!!!

            Avatar
            Columbia City, Indiana
            United States
            Member #2978
            December 9, 2003
            381 Posts
            Offline
            Posted: August 28, 2007, 1:17 pm - IP Logged

              from the article:

              "A lottery depends on its integrity, and so, you always want to rule that out,'' Ripley said in a telephone interview Monday. "I have seen absolutely no evidence of fraud at this point.''

            _________________________________________

              Isn't that the problem? Isn't that our POINT???

              When mechanical drawings are compromised, everyone can see it; when computer drawings are purposely sabotaged, no one can see it except a programmer who scrutinizes the code line by line, command by command. Any programmer who's being paid by the lottery to conduct such an inquiry would be as trustworthy and honest as any expert witness testifying in court; he's going to say what he's being paid to say, regardless of whether it's factually accurate. This is not meant to imply that programmers are inherently dishonest. Here in Indiana, however, if a programmer came forward with damaging information he obtained from examining their computer code, he'd find himself facing fifty years in prison for "Disclosing Confidential Lottery Information."

              I don't understand why these people expect us to believe that any computer system used by a state lottery is infinitely more secure than those used by the Pentagon. Or those used by the Veterans Administration. Or those used by any other government agency whose system has been compromised in recent years.

              Since I'm feeling a little psychotic today, I'll make the following prediction: They'll play out this little comedy they call an "internal investigation," and no wrongdoing will be found. They'll refund the money or, if they follow Indiana's lead, replace the losing tickets from the period in question, and then they'll tell the public how much integrity they have. The vast majority of Tennessee lottery players will shrug their shoulders and begin buying tickets again, and the Tennessee Lottery will make tons and tons of money, setting sales records year after year, due to fewer payouts.

              That's my prediction, and yes, I know I misspelled "psychic."

            Come, Pinky; we must prepare for tomorrow night...

            Jim

              psykomo's avatar - animal shark.jpg

              United States
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              May 30, 2004
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              Posted: August 28, 2007, 1:58 pm - IP Logged

              The Tennessean contacted me about doing a editorial about the Lottery mess but I don't think I will do it because I don't have time.

              KyMystikal??????????????????????????????????????????????????

              do I understand that U were ask bi a newspaper to write a lil ole

              editorial & YO <<<<<<<<<<<<<<<<<<DON't have TIME......????

              PLEASE @ least do us the honor of the SUBJECT!!!

              Hell^^^^^PSYKOMO will write a HIT SONG about the lottery if we

              we were ask by a state newspaper^^^^^!!!!!!!!!!!!!!!!!!!!!!!!!!!!

              The Tennessean>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

              (meanwhile)............. HAIL to Todd, HAIL Todd^^^^^^^^

              hope U don't run out of

              "TIME".............

              otherwise we would not know what DEE HELL DEE Lottery was

              try'n to do with RNG's and OTHER THINGS.........................TOO!!

                nobie23's avatar - squiz

                United States
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                December 12, 2003
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                Posted: August 28, 2007, 2:12 pm - IP Logged

                since this glitch thing started and corrected(not) Tn has been getting double digit numbers just about everyday(since Aug 20th). seems to me somebody else has her hand in the cookie jar Yes NodLOLYes Nod

                  LOTTOMIKE's avatar - cash money.jpg
                  Tennessee
                  United States
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                  October 15, 2004
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                  Posted: August 28, 2007, 3:35 pm - IP Logged

                  since this glitch thing started and corrected(not) Tn has been getting double digit numbers just about everyday(since Aug 20th). seems to me somebody else has her hand in the cookie jar Yes NodLOLYes Nod

                  i noticed that too!

                   

                  watch for quads soon!!!!!

                    Avatar
                    Kentucky
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                    February 14, 2006
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                    Online
                    Posted: August 28, 2007, 3:56 pm - IP Logged

                    "Hargrove said she did not believe fraud was involved. She said a player would have had to spend $720 to win $500 in the Cash 3 game and $5,040 to win $5,000 in Cash 4, making it unlikely anyone would purposely rig the games."

                    This statement is about one of the biggest red herrings I have ever read. WOW.

                    Could you please elaborate and explain, how this has anything to do with rigging draws?

                    I believe that statement was made to take the attention from who would benefit the most by having a rigged drawing.

                    When Hargrove announced the Tennessee Lottery was going to computer drawings she sited "to maximize dollars for education" as one of the reasons. When players began pointing out a possible problem with the new computer drawings because no doubles were drawn, they were told that security had looked into it to insure integrity of its games "to maximize dollars for education".

                    Even if we assume the explanations of the "U" and "R" keys as the truth, there is still that matter of those emails saying security ran test draws and doubles were drawn. Hargrove's statements prove that was a lie, but whether or not those emails were sent out by a summer intern or the official lottery spokesperson is irrelevant because the emails came from Hargrove's office. 

                    Will the probe investigate that and call for Hargrove's resignation or will they whitewash it because we all know who benefits the most by having a rigged drawing?

                      RJOh's avatar - chipmunk
                      mid-Ohio
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                      March 24, 2001
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                      Posted: August 28, 2007, 4:04 pm - IP Logged

                      "James H. Ripley, a Sevierville attorney who heads the 3-year-old lottery's audit group, said the agency should probe more deeply"

                      I thought auditing a lottery was an ongoing operation which was independent of the people running the games that checked equipment before each drawing and approved changes before they were installed to insure the results would be fair and random.  From Mr.Ripley statement I get the impression an audit doesn't occur until after a mistake is obvious and then the checks are done by people running the games who reports back to the audit group.  In other words when the farmer want to know what happened to his chickens he ask the fox in the hen house to investigate and report back to him.

                       * you don't need to buy more tickets, just buy a winning ticket * 
                         
                                   Evil Looking       

                        jarasan's avatar - new patrick.gif
                        Harbinger
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                        Posted: August 28, 2007, 4:13 pm - IP Logged

                        The Tennessean contacted me about doing a editorial about the Lottery mess but I don't think I will do it because I don't have time.

                        If so, you should make time, or refer them to Todd. IMHO. Really, or lottomike, it is a great opportunity.

                          CARBOB's avatar - FL LOTTERY_LOGO.png
                          ORLANDO, FLORIDA
                          United States
                          Member #4924
                          June 3, 2004
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                          Posted: August 28, 2007, 4:15 pm - IP Logged

                          I believe that statement was made to take the attention from who would benefit the most by having a rigged drawing.

                          When Hargrove announced the Tennessee Lottery was going to computer drawings she sited "to maximize dollars for education" as one of the reasons. When players began pointing out a possible problem with the new computer drawings because no doubles were drawn, they were told that security had looked into it to insure integrity of its games "to maximize dollars for education".

                          Even if we assume the explanations of the "U" and "R" keys as the truth, there is still that matter of those emails saying security ran test draws and doubles were drawn. Hargrove's statements prove that was a lie, but whether or not those emails were sent out by a summer intern or the official lottery spokesperson is irrelevant because the emails came from Hargrove's office. 

                          Will the probe investigate that and call for Hargrove's resignation or will they whitewash it because we all know who benefits the most by having a rigged drawing?

                          I am no computer programmer, but I guarantee you and everyone else, there were no tests done. If the RNG can't generate a double, then there so called test can't generate a double unless , a programmer over rode the code. If a programmer can change the code to generate a double. What's to stop that same programmer from generating a winning number and buying a 100 tickets, or a friend from buying a hundred tickets. They need to back track and see if a big group of winning tickets were purchased at the same time. This is worse than they are saying. They are acting like a cat in a litter box. A fox is in the hen house, Rjoh.

                            tnlotto1's avatar - logo
                            nashville
                            United States
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                            February 18, 2007
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                            Posted: August 28, 2007, 5:06 pm - IP Logged

                            The Tennessean contacted me about doing a editorial about the Lottery mess but I don't think I will do it because I don't have time.

                            i agree with jarasan you should pass it on to lottomike or let them know about lotterypost.com so they could get articles from here and talk to Todd.