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Former lottery security employee guilty of rigging $14.3M drawing

Hot LottoHot Lotto: Former lottery security employee guilty of rigging $14.3M drawing
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Jurors convicted a former Iowa lottery security official of two counts of fraud Monday for rigging a Hot Lotto drawing to win $14.3 million.

The jury's verdict came after three days of witness testimony last week in the case against Eddie Tipton, 52, who faces up to 10 years in prison. It's believed to be the first prosecution of a person accused of tampering with lottery equipment to manipulate a draw.

Tipton stared straight ahead with his hands folded as the verdict was read, showing no emotion. He will remain free on bond ahead of his sentencing hearing Sept. 9.

He left the courthouse without comment. But his lawyer, Dean Stowers, said the verdict was "not surprising," because the jurors were given speculative evidence.

Stowers said he's confident the appeals court ultimately will toss the jury's conviction.

Assistant Iowa Attorney General Rob Sand accused Tipton, formerly the information security director for the Multi-State Lottery Association, of installing a self-deleting computer program, called a rootkit, onto a Hot Lotto drawing computer to rig the outcome of a Dec. 29, 2010, drawing.

Tipton allegedly purchased the winning ticket six days earlier at a Des Moines QuickTrip.

Sand claims Tipton then helped filter the ticket through a Texas friend and a network of lawyers in an attempt to claim the cash. The two fraud charges required the state to prove beyond a reasonable doubt that Tipton tampered with the lottery computer and then passed on the ticket as part of a conspiracy to redeem it.

In his closing argument Friday, Sand pointed toward several pieces of evidence that jurors could rely on to convict Tipton, including:

  • Several of Tipton's friends and coworkers at the lottery association testified they believe Tipton was the purchaser, based on video of a hooded man buying the ticket. The witnesses said Tipton's voice matched that of the man on the video.
  • Jason Maher, the lottery association's IT director, said Tipton once told him he had access to a rootkit, though he did not specify in court more details about the program's capabilities.

Iowa Lottery CEO Terry Rich in a statement Monday called the case "fascinating." But he said it has enabled the lottery to "to further enhance our layers of security to protect the integrity of lottery games, and that ultimately has been a positive."

The money from the jackpot, totaling nearly $10.8 million in cash, "was returned to the lotteries in the Hot Lotto game in proportion to the sales from each jurisdiction," Rich said. "The Iowa Lottery received about $1.4 million back, and gave the money away in a special summer promotion called 'Mystery Millionaire' back in 2012. Fifteen players ended up winning prizes in that promotion."

Rich said he is confident the games are fair.

"Our lottery has strong layers of security to protect lottery players, lottery games and lottery prizes," he said. "Those procedures enabled us to seek information about the winning ticket in this case and not pay the prize until basic questions could be answered — and they never were."

Des Moines Register

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29 comments. Last comment 1 year ago by mypiemaster.
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lothob's avatar - chi jpeg.jpg

United States
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April 20, 2008
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Posted: July 20, 2015, 2:50 pm - IP Logged

So CEO Rich; rather than just trying to improve layers of security to catch a crook, why not also just get rid of the RNG and move back to ball machines which are harder to manipulate than computers?

"He who is not courageous enough to take risks will accomplish nothing in life."  Muhammad Ali

    TnTicketlosers's avatar - Lottery-065.jpg

    United States
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    Posted: July 20, 2015, 3:28 pm - IP Logged

    Why your at it,check all the states.

      Avatar
      Las Vegas, NV
      United States
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      August 9, 2006
      1749 Posts
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      Posted: July 20, 2015, 3:45 pm - IP Logged

      So CEO Rich; rather than just trying to improve layers of security to catch a crook, why not also just get rid of the RNG and move back to ball machines which are harder to manipulate than computers?

      I Agree!  Because in the meantime they're still not acknowledging that it WAS POSSIBLE to rig the drawing in the first place!!!  And had it not been for the lack of planning on "the how to cash the ticket" side of the scheme ... they might have gotten away with it.  We need to remember how they caught on in the first place ... I think the little so-called basic questions only came into play because out-of-state entities tried to cash the ticket.

      It should be very interesting to see how these computerized drawings fare now that this has come to light.

        lottobrain's avatar - box
        Smyrna, DE
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        Posted: July 20, 2015, 6:32 pm - IP Logged

        The article says "It's believed to be the first prosecution of a person accused of tampering with lottery equipment to manipulate a draw".  However, this is not true.  It happened twice in PA, back in 1980 with the famous "triple 6's" 3 digit draw and again in 1988 when a computer tech working for a lottery contractor programmed the a computer to print out a lottery ticket in a store where his friend worked for a $15.2 million lotto jackpot in the Super 7 drawing that was about to expire. The lottery was suspicious of his friend when he tried to claim the jackpot, but they made the first of the annuity payments while investigating.  Then after the advertisement of TV and radio about the unclaimed jackpot and where the ticket was sold, the real owner of the "real" ticket who had forgotten about buying a ticket, found it and came forward to make the claim.  Those 2 got prison time.

          Avatar
          Maryland
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          Member #162434
          January 2, 2015
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          Posted: July 20, 2015, 6:46 pm - IP Logged

          So this idiot got caught, how many out there have not?

          Time to get rid of this easy to manipulate way of pulling the numbers. 

            noise-gate's avatar - images q=tbn:ANd9GcR91HDs4UJhjxO7cmeMQWZ5lB_FOcMLOGicau4V74R45tDgPWrr
            Bay Area - California
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            December 12, 2012
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            Posted: July 20, 2015, 11:24 pm - IP Logged

            l guess it all boiled downed down to whether the jury accepted the evidence presented by Assistant Iowa Attorney General Rob Sand & Terry Rich or that of Tipton's Attorney.lt appears they wanted to send a message & they spoke loud and clear. 

            People who say it cannot be done should not interrupt those who are doing it- George Bernard Shaw.

              SilverLion's avatar - 8ball

              United States
              Member #165541
              April 12, 2015
              545 Posts
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              Posted: July 21, 2015, 12:45 am - IP Logged

              So CEO Rich; rather than just trying to improve layers of security to catch a crook, why not also just get rid of the RNG and move back to ball machines which are harder to manipulate than computers?

              Because they cant afford it!

              Why would somebody who is authorized to manage a free tax,  want to not skim? Do you know how much it costs to be honest?  Do you know how much those fancy cameras cost?  do you know how much Yolanda Vega gets paid? 

              Do you know how stupid our kids will get with real honest ball drawings?

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                Kentucky
                United States
                Member #32652
                February 14, 2006
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                Posted: July 21, 2015, 12:57 am - IP Logged

                Jurors convicted a former Iowa lottery security official of two counts of fraud Monday for rigging a Hot Lotto drawing to win $14.3 million.

                The jury's verdict came after three days of witness testimony last week in the case against Eddie Tipton, 52, who faces up to 10 years in prison. It's believed to be the first prosecution of a person accused of tampering with lottery equipment to manipulate a draw.

                Tipton stared straight ahead with his hands folded as the verdict was read, showing no emotion. He will remain free on bond ahead of his sentencing hearing Sept. 9.

                He left the courthouse without comment. But his lawyer, Dean Stowers, said the verdict was "not surprising," because the jurors were given speculative evidence.

                Stowers said he's confident the appeals court ultimately will toss the jury's conviction.

                Assistant Iowa Attorney General Rob Sand accused Tipton, formerly the information security director for the Multi-State Lottery Association, of installing a self-deleting computer program, called a rootkit, onto a Hot Lotto drawing computer to rig the outcome of a Dec. 29, 2010, drawing.

                Tipton allegedly purchased the winning ticket six days earlier at a Des Moines QuickTrip.

                Sand claims Tipton then helped filter the ticket through a Texas friend and a network of lawyers in an attempt to claim the cash. The two fraud charges required the state to prove beyond a reasonable doubt that Tipton tampered with the lottery computer and then passed on the ticket as part of a conspiracy to redeem it.

                In his closing argument Friday, Sand pointed toward several pieces of evidence that jurors could rely on to convict Tipton, including:

                • Several of Tipton's friends and coworkers at the lottery association testified they believe Tipton was the purchaser, based on video of a hooded man buying the ticket. The witnesses said Tipton's voice matched that of the man on the video.
                • Jason Maher, the lottery association's IT director, said Tipton once told him he had access to a rootkit, though he did not specify in court more details about the program's capabilities.

                Iowa Lottery CEO Terry Rich in a statement Monday called the case "fascinating." But he said it has enabled the lottery to "to further enhance our layers of security to protect the integrity of lottery games, and that ultimately has been a positive."

                The money from the jackpot, totaling nearly $10.8 million in cash, "was returned to the lotteries in the Hot Lotto game in proportion to the sales from each jurisdiction," Rich said. "The Iowa Lottery received about $1.4 million back, and gave the money away in a special summer promotion called 'Mystery Millionaire' back in 2012. Fifteen players ended up winning prizes in that promotion."

                Rich said he is confident the games are fair.

                "Our lottery has strong layers of security to protect lottery players, lottery games and lottery prizes," he said. "Those procedures enabled us to seek information about the winning ticket in this case and not pay the prize until basic questions could be answered — and they never were."

                Rich said he is confident the games are fair. But only after a former lottery security employee was found guilty of rigging $14.3 million drawing.

                  RedStang's avatar - tallman zps6gf4inoc.jpg
                  NY
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                  January 21, 2012
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                  Posted: July 21, 2015, 1:09 am - IP Logged

                  Can't believe he bought the ticket himself. He was so close to hatching the perfect plan. Now he might make the Darwin top ten.

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                    homestead
                    United States
                    Member #158182
                    August 14, 2014
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                    Posted: July 21, 2015, 3:09 am - IP Logged

                    Can't believe he bought the ticket himself. He was so close to hatching the perfect plan. Now he might make the Darwin top ten.

                    True. He should have gotten a person not associated with the Iowa Lotto to buy the tickets on his behalf. Once that person wins, they establish a Trust and split the money. When it comes to these scheme's, never get involved directly.

                      mypiemaster's avatar - 2015021003pileofcash
                      JACKPOT HUNTER

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                      Posted: July 21, 2015, 8:21 am - IP Logged

                      I knew they were going to lay the smack down on him, just to send a loud and clear message, to anybody else contemplating on getting involved, in such nefarious activities. Guilty or not, I have my doubts.

                      Seek and ye shall find -Matt. 7:7 ...Ask and ye shall receive -John 16:24 ...Give and it shall be given unto you -Luke 6:38 ...Be careful what you ask for!!! -Mypiemaster 1:1

                      Having Money Solves Problems That Not Having Money Creates Yes Nod ****John Carlton****

                        pickone4me's avatar - 021414tvlies zpsa453b327.jpg
                        Wisconsin
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                        Posted: July 21, 2015, 9:57 am - IP Logged

                        So what is the plan with RNG computer draw states?

                        Trump 2016!

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                          July 21, 2015
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                          Posted: July 21, 2015, 11:11 am - IP Logged

                          The problem I have with all of these people who are caught cheating is that the State/Corporation gets the money and not the people who were playing the game at the time.  It's worse on Scratch-offs because if a jackpot is taken out of the game due to someone cheating the jackpot should be reinserted somewhere into the game which the players should have a shot at.

                            cbr$'s avatar - maren
                            Cordova,Al.
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                            Posted: July 21, 2015, 12:23 pm - IP Logged

                            What I find fascinating about this is, Iowa Lottery CEO.  Terry Rich said "he is confident the games are fair." They have enhance their layer's of security. As long as the program for the rootkit's exist it is being improved and enhance as well. There are kit's/ programs that already exist right now. that are capabilities that can do this again or more, within a 50 mile  range.  I think Iowa new best friend, such be live draws.