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Extradition trial begins this week in $16.5M Hot Lotto fraud case

Hot LottoHot Lotto: Extradition trial begins this week in $16.5M Hot Lotto fraud case
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Legal wheels turning after rigged Hot Lotto drawing uncovered

After months of investigation and legal wrangling, legal actions against two men accused of rigging a multi-state Hot Lotto computerized drawing are proceeding.

When Sugar Land, Texas, resident Robert C. Rhodes endorsed Eddie Tipton on the professional networking website LinkedIn, he deemed his friend and former business partner as someone "very focused on the bottom line" and someone he would work with again "in a second."

The two men both attended the University of Houston and worked together for seven years, until 2003, at Rhodes' Houston-based company, Systems Evolution, where Tipton was identified as the chief operations officer.

Now, more than 10 years later, the men are charged with trying to defraud a multi-state lottery organization of $16.5 million in a Hot Lotto game, a case that drew national attention as a mystery of sorts, when a man who claimed to be the winner contacted lottery officials, only to later say he was representing someone who wanted to remain anonymous.

(See BOMBSHELL: MUSL employee might have rigged Hot Lotto computerized drawing, Lottery Post, Apr. 13, 2015.)

Lottery officials balked at paying the amount, saying certain security criteria wasn't met and prosecutors later determined that the attempt was an inside job by Tipton, at the time the security director for the Multi-State Lottery Association, an Iowa-based group that operates state lotteries, including the Hot Lotto.

His former partner, Rhodes, was accused of being part of the plan. (See Texas man charged in Iowa lottery case contests extradition, Lottery Post, Apr. 20, 2015.)

Tipton, who lives in Norwalk, Iowa was charged with two counts of fraud, a class D felony. His trial is set for July 13.

Rhodes is charged with one count of forgery and one count of fraud, both class D felonies. He is in Texas, free on $10,000 bail. He has surrendered his passport. This week, he was scheduled to be in a Fort Bend County courtroom to contest extradition to Iowa. His next court date is on June 18.

Tipton's defense attorney, Dean Stowers, said one charge accuses his client of tampering with lottery equipment at the Multi-State Lottery Association, causing it to generate the winning numbers. The other charge accuses him of buying the ticket, which as an employee of the lottery, he is prohibited from doing.

"They refuse to specify exactly what they're claiming or exactly when they claim it happened," Stowers said, referring to the tampering allegation. "However, as best as we can tell, they're claiming that on November the 20th of 2010, five or six weeks before the December 29th, 2010 lottery try, he accessed the computer, or both of the computers that generate these numbers, the winning numbers, and somehow planted some kind of software on there that activated and generated the numbers, you know, five or six weeks later."

Rhodes' attorneys could not be reached for comment. In court documents filed with the Fort Bend District Clerk's office seeking a bail reduction - the bail was initially set at $500,000 - his attorneys said he has joint custody of three children, regularly pays child support and does not have a prior conviction.

Details of the charges against the men are outlined in affidavits filed in Polk County, Iowa.

The case involves a Hot Lotto ticket purchased at a Des Moines convenience store on Dec. 23, 2010. The purchase was recorded with video and audio.

Almost one year later, on Dec. 3, 2011, a Canadian man contacted lottery officials, telling them he was the winner. He provided some critical information, such as certain numbers on the ticket, but authorities became skeptical about his answers to other questions, including what he was wearing the day he bought the ticket. The man later said he was representing someone who wanted anonymity. A New York colleague of the Canadian man later met with lottery officials to try to claim the winning ticket, but also was denied.

The Canadian man later told authorities that Rhodes and a Houston attorney, two people he knew, contacted him in October 2011, seeking help with collecting the winnings. The New York attorney told authorities he knew the Houston attorney.

In October of last year, the lottery organization released the video of the ticket purchase and four days later a lottery employee told authorities the man in the image was Tipton.

When questioned by the Iowa Division of Criminal Investigation, Tipton said he was in Houston the day the ticket was bought, visiting relatives, according to the affidavit.

Cell phone records indicate he was in the Des Moines area on the date the ticket was purchased, according to the affidavit.

During that interview, Tipton did not bring up Rhodes' name.

Again citing cell phone records, authorities said records indicate frequent lengthy calls between Tipton and Rhodes, sometimes over an hour, including on the day the ticket was purchased, the affidavit states.

Stowers said Tipton does not match the identity of the person who purchased the ticket, and that there is evidence that it was not possible for his client to "tamper with the computers in any way" that would create the "scenario" the state says happened.

"He's looking forward to his trial when all of the speculation can come to an end, and all of the allegations that are being made can be brought forth in court if they have any merit to them, and the jury can make a decision on his case, because he's anxious to move on with his life," Stowers said.

At a January news conference, Iowa Lottery official Terry Rich said his organization believes this is the largest lottery jackpot to ever be claimed, only to "have that claim withdrawn."

"This truly is one of the strangest situations in the history of lotteries," Rich said.

Houston Chronicle, Lottery Post Staff

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26 comments. Last comment 1 year ago by RJOh.
Page 1 of 2
Avatar
Simpsonville
United States
Member #163189
January 22, 2015
667 Posts
Offline
Posted: June 7, 2015, 10:06 am - IP Logged

Too bad the feds didn't outlaw RNG.  This case gets weirder and weirder.

    MillionsWanted's avatar - 24Qa6LT

    Norway
    Member #9517
    December 10, 2004
    1272 Posts
    Online
    Posted: June 7, 2015, 10:22 am - IP Logged

    A lesson to be learned by those who supports computer generated RNG draws.

      zephbe's avatar - animal butterfly.jpg
      South Carolina
      United States
      Member #77167
      July 15, 2009
      554 Posts
      Offline
      Posted: June 7, 2015, 10:48 am - IP Logged

      Too bad the feds didn't outlaw RNG.  This case gets weirder and weirder.

      I Agree!  air machines and ping pong balls are harder to rig.

        Teddi's avatar - Lottery-008.jpg

        United States
        Member #142499
        May 13, 2013
        1182 Posts
        Offline
        Posted: June 7, 2015, 12:30 pm - IP Logged

        I really hope I'm not denied my winnings if I can't remember what I was wearing on the day I bought the winning ticket. I probably wouldn't even be able to say where I bought it so presenting a signed ticket better be enough for them.

        I might wake up early and go running.  I might also wake up and win the lottery.

        The odds are about the same.

          Avatar
          New Member
          Washington
          United States
          Member #162584
          January 5, 2015
          2 Posts
          Offline
          Posted: June 7, 2015, 1:40 pm - IP Logged

          How ridiculous is this!? I've always felt like anyone who creates an RNG will know exactly how it works and therefore can predict future results. It doesn't matter that there are "good people" working in or with the lotteries. They're no longer good once you find out they did something like this... The perceived image that all Commissions and others involved are trustworthy is complete crap. They're only ALLOWING/ENABLING things like this to happen by playing with RNG'S and ADM's. The ONLY way to have a fair drawing is to have a REAL drawing.

            haymaker's avatar - Lottery-012.jpg
            Egg Harbor twp.south Jersey shore
            United States
            Member #112968
            June 29, 2011
            3854 Posts
            Offline
            Posted: June 7, 2015, 9:25 pm - IP Logged

            I was playing  this game in Delaware, then thanks to LP found it was RNG and that was it.

            I just don't play !

            RNG = JDP

            Extraordinary Popular Delusions & the Madness of Crowds    -- Charles Mackay  LL.D.

              itpmguru's avatar - 42a4d4d8f2a4312fb8e253dd8f6ef251
              No Man's Land
              United States
              Member #164139
              February 19, 2015
              5460 Posts
              Offline
              Posted: June 8, 2015, 1:24 am - IP Logged

              I Agree!  air machines and ping pong balls are harder to rig.

              I would not be so sure about that, they do it here in NC everyday!

              I won't get mad......I won't get even and NCEL will pay my bills :-)  - ITP
              "He who is not courageous enough to take risks will accomplish nothing in life." - Muhammad Ali
                                                   


                ThatScaryChick's avatar - x1MqPuM
                Idaho
                United States
                Member #56506
                November 21, 2007
                6537 Posts
                Offline
                Posted: June 8, 2015, 4:54 am - IP Logged

                I wish this was getting more media attention so that Hot Lotto would feel pressured to go to ball drawings.

                "No one remembers the person who almost climbed the mountain, only the person who eventually gets to the top."

                  RJOh's avatar - chipmunk
                  mid-Ohio
                  United States
                  Member #9
                  March 24, 2001
                  19817 Posts
                  Offline
                  Posted: June 8, 2015, 7:31 am - IP Logged

                  I was playing  this game in Delaware, then thanks to LP found it was RNG and that was it.

                  I just don't play !

                  RNG = JDP

                  Didn't you ever wonder enough about the game to try and watch a live drawing?  Games don't try to hide the fact that they use a RNG, in fact most try to dress them up and make them look like more fun than one of those ping pong ball machine.

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


                    United States
                    Member #106134
                    February 13, 2011
                    806 Posts
                    Offline
                    Posted: June 8, 2015, 12:38 pm - IP Logged

                    Git 'em!

                    About time they started busting some cheats!  I hope they get hard time in a pound me in the a$$ maximum security prison!

                      Avatar
                      Kentucky
                      United States
                      Member #32652
                      February 14, 2006
                      7297 Posts
                      Offline
                      Posted: June 8, 2015, 3:27 pm - IP Logged

                      I wish this was getting more media attention so that Hot Lotto would feel pressured to go to ball drawings.

                      "They refuse to specify exactly what they're claiming or exactly when they claim it happened," Stowers said, referring to the tampering allegation. "However, as best as we can tell, they're claiming that on November the 20th of 2010, five or six weeks before the December 29th, 2010 lottery try, he accessed the computer, or both of the computers that generate these numbers, the winning numbers, and somehow planted some kind of software on there that activated and generated the numbers, you know, five or six weeks later."

                      The Hot Lotto people have a huge huge problem proving it's possible that Tipton rigged the drawing five or six weeks before and then actually rigged a lottery terminal to print the same numbers. And if they can, they are basically proving any RNG drawing can be rigged.

                      If you want to send the Hot Lotto people a message, stop playing their games.

                        pickone4me's avatar - 021414tvlies zpsa453b327.jpg
                        Wisconsin
                        United States
                        Member #104962
                        January 23, 2011
                        1075 Posts
                        Offline
                        Posted: June 8, 2015, 5:10 pm - IP Logged

                        How ridiculous is this!? I've always felt like anyone who creates an RNG will know exactly how it works and therefore can predict future results. It doesn't matter that there are "good people" working in or with the lotteries. They're no longer good once you find out they did something like this... The perceived image that all Commissions and others involved are trustworthy is complete crap. They're only ALLOWING/ENABLING things like this to happen by playing with RNG'S and ADM's. The ONLY way to have a fair drawing is to have a REAL drawing.

                        I Agree!

                        Trump 2016!

                          pickone4me's avatar - 021414tvlies zpsa453b327.jpg
                          Wisconsin
                          United States
                          Member #104962
                          January 23, 2011
                          1075 Posts
                          Offline
                          Posted: June 8, 2015, 5:15 pm - IP Logged

                          I found this part in the story

                          Lottery officials balked at paying the amount, saying certain security criteria wasn't met and prosecutors later determined that the attempt was an inside job by Tipton, at the time the security director for the Multi-State Lottery Association, an Iowa-based group that operates state lotteries, including the Hot Lotto.

                          How many times have my haters  called me derogative things ( it is not a conspiracy theory anymore, it is now a conspiracy fact! ) for even mentioning that the lottery can and maybe rigged. 

                          What really sucks, is that wisconsin an RNG state,  so if I want to play a lottery, I'd have to play MM or PB....I so much enjoy having that signature saying I don't play either one. 

                          Trump 2016!

                            haymaker's avatar - Lottery-012.jpg
                            Egg Harbor twp.south Jersey shore
                            United States
                            Member #112968
                            June 29, 2011
                            3854 Posts
                            Offline
                            Posted: June 8, 2015, 9:09 pm - IP Logged

                            Didn't you ever wonder enough about the game to try and watch a live drawing?  Games don't try to hide the fact that they use a RNG, in fact most try to dress them up and make them look like more fun than one of those ping pong ball machine.

                            RJOh,

                            I almost never see a live drawing Xcept  PA has theirs on just before jeopardy, but I never have PA tix.

                            Jersey's draw comes on a diff. channel @ 7:59 PM and I always forget, by the time they draw MM and PB I'm asleep.

                             

                             I was in  Delaware to buy PB and MM cause they are anonymous, and bought a 10 draw advance on HOTLOTTO on a whim,

                            then looked it up here on LP, that's when I realized my mistake.

                             

                            I suppose you're right about  them dressing it up, sounds like that would work on casual players and fools.

                            Extraordinary Popular Delusions & the Madness of Crowds    -- Charles Mackay  LL.D.