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Lottery 'glitch' leaves players suspicious

Tennessee LotteryTennessee Lottery: Lottery 'glitch' leaves players suspicious
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Brentwood lottery player Wil Prude thinks the computers that draw random numbers for the Tennessee Lottery's Cash 3 and Cash 4 games still have not been repaired.

Lottery officials announced Aug. 21 that a "glitch" in the system had been corrected — one that prevented duplicate numbers, such as 1-1-3, from being drawn as winning combinations for the previous three weeks.

But Prude, who plays Cash 3 every day, is among the players whose confidence in the game is now shaken. He says the machines need a thorough going-over by an outside expert.

"That's what needs to be done,'' Prude said. "An independent auditor like Ernst & Young or Deloitte & Touche to come in and look at the system and tell us if we are getting a fair chance of winning.''

Fueling his suspicions, and those of other players now in doubt, is what they view as the Tennessee Lottery's long delay in getting the so-called glitch fixed, and less-than-aggressive action by lottery executives to find out exactly what happened.

The lottery said last week that it is working to find an outside consultant to conduct a probe.

Something was 'funky'

Lottery officials knew as early as Aug. 3 that there was a potential problem, according to a lottery memo reviewed by The Tennessean under the state public records law. They say they acted appropriately when they noticed no duplicate numbers were being drawn.

But two experts in statistics disagree, saying lottery officials should have checked the computer code and procedures immediately when they realized duplicate numbers weren't coming up.

By Aug. 3, the probability that no doubles, triples or quadruples would have been drawn in the two games was about one in a million, said Rafe Donahue, a research associate professor in Vanderbilt University's Department of Biostatistics.

"At that point, you've got to think, 'We've got to dig into this. There is something funky going on,' '' he said.

Players like Prude first sounded the alarm about lottery machines run amok.

Internal lottery documents show that players began complaining about the strange drawing patterns less than a week after the old ball-drop system was replaced with computers that could generate random numbers for the twice-daily drawings.

Lottery officials found the patterns unusual but initially assigned them to chance, an analysis that numbers experts called flawed.

"This is one reason why rigorous probability theory and statistical methodologies were invented: Intuition can mislead us when thinking about chance and probabilities," said Chris Orum, a mathematician at Los Alamos National Laboratory who has worked with the Oregon Lottery.

Coding error blamed

Lottery officials on Aug. 13 did contact Gaming Laboratories Inc., an independent lab that tested the equipment before it was shipped to Tennessee.

But it wasn't until Aug. 20 that the Tennessee Lottery called the vendor, Smartplay International Inc., where a coding error was quickly discovered.

The firm's computer programmers checked the code and found that someone had typed a "u" for "unique," rather than an "r" for "repeatable." This told the computer to crank out only non-duplicating numbers as winning combinations.

Gaming Laboratories did not discover the error because it was hidden among 1,400 lines of computer code in one module of the software, said James Maida, president of the firm. Company programmers had to scan more than 30,000 lines of code to check the entire system, he said.

The method used to test the system is complicated and difficult to explain but resulted in the bad code affecting the live drawings, but not the feature that tests the system, Maida said. That's why lottery officials were not finding any flaws during repeated tests, he said.

Vendor has experience

The glitch might not have happened at all if the lottery had bought the software to pick the random numbers from a different vendor. A Rhode Island firm, Szrek2Solutions, proposed a system costing more than $100,000 less than the one offered by Smartplay.

Lottery officials were not impressed with it, though, saying the network to communicate to television stations was not as secure, and the system not as complete, as the one Smartplay proposed.

Also, the company was younger and didn't have Smartplay's track record of supplying equipment to American lotteries, they said.

"I don't believe they had a system for half of what we wanted,'' lottery director Rebecca Paul Hargrove said.

The procurement method that lottery officials used did not require them to buy the system with the lowest price tag.

Instead, they picked Smartplay, a company that had been in business for more than a decade with lottery contracts across the U.S. and overseas, including random number generators operating in the New Mexico, Arizona, Ohio and Washington lotteries, the company's materials said.

Tennessee Lottery officials were well acquainted with Smartplay executives. The New Jersey firm was founded by former employees of Beitel Lottery Products, a company that had done business with the state of Florida when Hargrove was lottery director there two decades ago.

Smartplay's president, David Michaud, had been Beitel's chief engineer. Smartplay acquired the manufacturing rights to Beitel products in 1997.

"There is no reason at all to believe they are not on the up and up,'' said Wanda Wilson, the Tennessee Lottery's general counsel.

CEO says rigging 'doesn't make any sense'

Since the acknowledgement of the glitch, Hargrove and other lottery executives have downplayed the need for a thorough probe, saying they believe it was the fault of human error, not intentional fraud.

Instead, the chairman of the lottery board's audit committee has been leading that effort, calling for an investigation to include an analysis of the possibility fraud could be involved.

Such an investigation is important to determine how the procedures used to test the system failed to ferret out the coding error and to make sure nothing untoward happened, Vanderbilt's Donahue said. Otherwise, he said, it could happen again if the lottery bought more software from the same company.

"My guess is, this glitch has been resolved in a certain sense, this particular one,'' Donahue said. "But it seems to me that the door is still probably cracked a little bit for some unforeseen glitch to come in in the future.''

Hargrove said fraud was unlikely on anyone's part because a player would have to have bought $1 tickets for all 720 unique combinations of numbers to ensure being a winner in the Cash 3 game - for a payout of just $500. For a $5,000 prize in Cash 4, a player would have had to have bought 5,040 tickets.

"It just doesn't make any sense'' for anyone to rig a game in such a way, Hargrove said.

'Cloud hanging over it'

Donahue agreed malicious intent was unlikely but observed that a player noticing that no duplicate numbers were being drawn could buy tickets for 4,000 different numbers on Cash 4 and have an 80 percent chance of winning the $5,000 prize.

"Although your expectation still is negative, it's not very much negative,'' he said.

Smartplay executives have not responded to Tennessean phone calls but issued a news release last week saying that a coding error was discovered after Tennessee Lottery officials called and that it was immediately corrected.

The Tennessee Lottery had been using Smartplay machines for other games, and they functioned perfectly, Hargrove said.

But Prude and some other players look forward to a thorough review by an outside firm.

Since the glitch presumably was fixed, Prude said, the Cash 3 game has been churning out too many duplicates in winning combinations. There also have been two instances of identical numbers coming out back to back, he said.

That could be a matter of simple chance, however, Donahue said.

"I'm not saying anybody has done anything wrong," said Roger Evans, who lives in Bellevue, "but any time you have got something like this that is government run and involves money, everybody has some kind of suspicion. If this lottery has a cloud hanging over it, a dark cloud, I think it does need to be investigated."

Tennessean

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6 comments. Last comment 9 years ago by Guru101.
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Indiana
United States
Member #29196
December 29, 2005
280 Posts
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Posted: September 2, 2007, 3:15 pm - IP Logged

Great story!

This is the most damaging story yet to appear in the press accounts I have read.  And it should be one that has all lottery players in every state that has an RNG...not just the players in Tennessee...screaming for an end to this crooked method of selecting numbers.

Let's look at a few of the remarks made in this story and tie the lose ends together:

Since the acknowledgement of the glitch, Hargrove and other lottery executives have downplayed the need for a thorough probe, saying they believe it was the fault of human error, not intentional fraud.

"It just doesn't make any sense" (sic) for anyone to rig a game in such a way, Hargrove said.

It makes perfect sense that a state official who runs a multi million dollar gambling operation...who made the decision to switch to a computerized RNG...and who stands to benefit both personally and professionally from this "glitch"...and who had the motive,  the means and the opportunity to make this "glitch" happen...would rig the game in just such a way and try to cover it up. 

A  person of integrity...who did nothing wrong...had nothing to hide...was genuinely sorry and had the best interest of all parties concerned would not try to hide what really happened.  But that is exactly what Ms Hargrove is trying to do. 

Why?

Tennessee Lottery officials were well acquainted with Smartplay executives.  The New Jersey firm was founded by former employees of Beitel Lottery Products, a company that had done business with the state of Florida when Hargrove was the lottery director there two decades ago.

So now we have motive..means...opportunity...and the right connection to make this happen.  No wonder she doesn't want an investigation.

Another reason Ms. Hargrove doesn't want a thorough investigation:

The method used to test the system is complicated and difficult to explain but resulted in the bad code affecting the live drawings, but not the feature that tests the system, Maida said.

"My guess is, the glitch has been resolved in a certain sense, this particular one," Donahue said.  "But it seems to me that the door is still probably cracked a little bit for some unforseen glitch to come in in (sic) future."

The auditor of the Tennessee Lottery is making 2 things absolutely clear; (1) The "glitch" operated in such a way that it was impossible to find during a test and (2) therefore, there may still be other "glitches" hiding in the program that affect future draws.

Ms. Hargrove certainly doesn't want that known to the public!  After all it was she who assured everyone that RNG drawings would be more secure than ball drawings.  But now we have the Tennessee Lottery's auditor saying well there may be more "glitches" present that we can't detect.  After all her hype it is clear...Ms Hargorove sold the people in Tennessee a system that is less secure than their old one.  And the people of Teneesee need to ask the obvious question; why?

Perhaps the most damning statement in this story is from the Lottery's General Counsel:

"There is no reason at all to believe they are not on the up and up," said Wanda Wilson, the Tennessee Lottery's general counsel.

Now think about this...we have a vendor that provided a computer program with an undectable "glitch."  A "glitch" that went undected by the vendor...the security firm and the Tennesse Lottery.  A "glitch" that was able to hide from the tests and only effect the live drawings.  And according to the auditor there may still be another "glitch" present and hiding.  And this nitwit Legal Counsel says there is no reason to believe they (presumably the vendor) are not on the up and up?  An "up and up "glitch" that hides from the test but only effects real drawings? 

IN-FREAKIN-CREDIBLE!

So to sum it up we have a Lottery Director with ties to a vendor..who decides to purchase said vendor's more expensive product on the pretext that it is more secure.  Said product is faulty and cheats players out of their money with a programmed "glitch" that is impossible to detect and funtcions normally during test mod but not during live draws.  The aforementioned Director has a professional motive and a personal...i.e financial motive...that could make her as much as $247,000 a year on top of her salary depending on the lottery's proifitability.  And she sees no need here for a thorough investigation even though the lottery's chief auditor says there may be other unforseen "glitches" still hiding in the program.

Intergity my *ss!  This looks like the cover up of a crime pure and simple.  And it doesn't get any more corrupt than this...(except in Indiana.)

Jim 


Money frees you from doing things you dislike.  Since I dislike doing nearly everything, money is handy.  - Groucho Marx

    Avatar
    Columbia City, Indiana
    United States
    Member #2978
    December 9, 2003
    381 Posts
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    Posted: September 2, 2007, 6:57 pm - IP Logged

      from the article:

      "The glitch might not have happened at all if the lottery had bought the software to pick the random numbers from a different vendor. A Rhode Island firm, Szrek2Solutions, proposed a system costing more than $100,000 less than the one offered by Smartplay."

    _______________________________________

      I corresponded with Irena Szrek and her husband in 2003, when LosingJeff and I were investigating the Hoosier Lottery's fraudulent operation. The RNG's manufactured by Szrek2Solutions are integrally auditable, meaning that any drawing the machine has generated can be audited for proper operation. It will show, for example, whether any code was added or deleted for any particular drawing, even if that drawing was conducted three years ago!

      It's a sealed system, which means that lottery programmers don't have access to the code contained in the machine. Irena told me they do this in order to preclude the possibility that an in-house programmer could manipulate the outcomes of the drawings. Szrek2Solutions manufactures the most secure RNG's on the planet and, as pointed out in the article, their machines cost thousands less than those of their closest competitors. Also, their machines utilize redundant technology, which means that if one security measure fails or is defeated, another component will record and report that failure in real time when the next test is performed. Since their audit security is cascaded, any attempt to defeat one or more of their security measures will result in a fatal error, which must be addressed before the next drawing can be conducted. This, naturally, would result in hysterical panic on the part of the perpetrator, and would likely initiate an investigation, since the entire machine would have to be shipped back to Szrek before it could be brought back online. The corrupt lottery official or programmer would have no hope of hiding his crime, since the evidence would now be in the hands of the manufacturer.  

      When I told them what Indiana was doing with their somewhat less-than-secure RNG, they were appalled, but not surprised. When large amounts of money are are left unguarded, even for a short time, some people will figure out a way to carry off as much of it as they can.

      I'm still vehemently opposed to any RNG being used in a state lottery, but I would tend to have more confidence in one manufactured by Szrek2Solutions, simply because I know how well they're built.

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

    Jim

      four4me's avatar - gate1
      MD
      United States
      Member #1701
      June 18, 2003
      8358 Posts
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      Posted: September 2, 2007, 8:50 pm - IP Logged

      Another little malfunction seems to be shaping up repeat digits. Whatever software they got is definitely whacked.

      It appears as there might be another glitch with the drawings as now they are continuously drawing the same digits over the last several draws.

      While this sometimes happens in ball drawings it doesn't happen a lot with RNG drawings.
      Tennessee lottery draws.

      CASH 3 9/2/2007 Evening 792
      CASH 3 9/1/2007 Mid-Day 839
      CASH 3 9/1/2007 Evening 789
      CASH 3 8/31/2007 Mid-Day 893
      CASH 3 8/31/2007 Evening 621
      CASH 3 8/30/2007 Mid-Day 940
      CASH 3 8/30/2007 Evening 940

      They should do away with the computerized software and bring back live ball drawings. I ain't buying what they are dishing out as being coincidental.

        KyMystikal's avatar - 1457224010054
        Florence, Alabama
        United States
        Member #8658
        November 13, 2004
        1993 Posts
        Offline
        Posted: September 2, 2007, 9:39 pm - IP Logged

        Hargrove said fraud was unlikely on anyone's part because a player would have to have bought $1 tickets for all 720 unique combinations of numbers to ensure being a winner in the Cash 3 game - for a payout of just $500. For a $5,000 prize in Cash 4, a player would have had to have bought 5,040 tickets.

        What she has figured is true but why play all the combinations when you could just play half and still have a good chance of doubling your money, or even playing 1/3, or 2/3 of the combinations. Besides I don't think the fraud people are talking about is for people winning. I think it's more to the fact that the lottery makes more money because they are assured certain number combinations won't come out. I'm pretty sure not all the money made goes to the Education fund because lottery employees don't work for free and the bonuses have to come from somewhere.

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


          United States
          Member #16612
          June 2, 2005
          3493 Posts
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          Posted: September 4, 2007, 2:39 pm - IP Logged

          Why there was a glitch? I hope they fix the glitch on the next day.

            Guru101's avatar - rw6jhh
            Indiana
            United States
            Member #48725
            January 7, 2007
            1953 Posts
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            Posted: September 4, 2007, 2:40 pm - IP Logged

            Why there was a glitch? I hope they fix the glitch on the next day.

            I hope, I hope, I hope. You sure do hope a lot.

            Gonna win.Big Smile