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Iowa court reverses part of Tipton's lottery fraud conviction

Insider BuzzInsider Buzz: Iowa court reverses part of Tipton's lottery fraud conviction
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DES MOINES, Iowa — An Iowa appeals court on Wednesday upheld a former lottery employee's conviction for rigging the computer system to generate the winning ticket in a $16 million jackpot, but reversed a conviction for attempting to cash in on the ticket.

The conviction stems from Eddie Tipton's work for the Iowa-based Multi-State Lottery Association, or MSLA, which produces computers that generate random numbers for lotteries in multiple states. As an employee of the association, Tipton was barred from playing the lottery.

But in December of 2010, the winning ticket for a $16 million dollar Hot Lotto jackpot was drawn in Iowa, according to an overview of the case written by Iowa Court of Appeals Judge Anuradha Vaitheswaran. A Canadian man and, later an attorney for an anonymous client, both attempted to redeem the ticket, but they were turned away because they did not look like the man caught in a surveillance video of the purchase.

Four years later, the state released the video to the public in hopes of identifying the purchaser. Another MSLA employee recognized Tipton.

The state charged Tipton with two felonies: passing or attempting to redeem a lottery ticket with the specific intent to defraud, and tampering with lottery equipment with the intent to influence winnings.

A jury convicted Tipton on both charges in early 2015.

Tipton appealed, arguing that the state's charges were barred by the three-year statute of limitations. Tipton purchased the ticket in 2010, but did not face charges for it until five years later.

The state claimed that the statute of limitations did not apply to the charge of attempting to redeem the lottery ticket because the crime was "ongoing," but the appeals court didn't buy it.

"[T]he purchase [of the winning ticket] itself was not a crime," Vaitheswaran wrote for a three-judge panel in her 16-page opinion. "Certainly, the inference could be drawn that the ticket was passed to someone, because at least two people attempted to redeem it. But the minutes do not disclose when, if at all, Tipton acted after the ticket was purchased."

The judge added that the latest date he could have acted was Dec. 29, 2011, the last date to redeem the ticket. After that, the state took custody of it.
However, the tampering charge qualified for an extension of the statute of limitations because the state did not suspect the crime until the video of Tipton purchasing the winning ticket was released in 2014.

Whereas the state suspected some kind of fraud as soon as someone tried to redeem the ticket, "the State could not have known the fraud included tampering with lottery equipment until Tipton was identified as the purchaser," Vaitheswaran said.

The appeals court also found sufficient evidence to support the tampering conviction. While Tipton worked for the MSLA from 2003 up until his arrest in 2015, he was in charge of information technology, had a hand in writing the number-generating software and participated in drafting the computer's security policies.

Surveillance footage showed Tipton entering the "draw room," which housed the two number-generating computers, one month before the winning numbers were drawn, allegedly to update the dates on the computers. The next month, both computers were wiped, according to court records.

"The jury reasonably could have inferred from Tipton's position in the organization and his knowledge of security protocols that he was aware of this upcoming event when he entered the draw room in November 2010," Vaitheswaran wrote.

In addition, the ticket's first attempted claimant chose to fill in the winning numbers himself rather than accept random, computer-generated numbers. He also submitted two sets of numbers, since the winning string could come from either of the computers.

"Based on this circumstantial evidence, the jury reasonably could have found that Tipton tampered with the random number generator computers with the intent to influence the lottery winnings," Vaitheswaran concluded.

The case will now go back to the district court for sentencing on the remaining charge. The court initially sentenced Tipton to 10 years in prison, but he has been free while his appeal was pending, according to an Associated Press report.

Neither the Iowa Attorney General's Office, which prosecuted the case, nor Tipton's attorney Dean Stowers responded to voicemail messages requesting comment Wednesday.

However, according to the AP, both Stowers and the Iowa Attorney General's Office are considering appealing to the Iowa Supreme Court.

In February, Tipton will face a second trial in Iowa on charges related to his alleged manipulation of lottery computers for Colorado, Kansas, Oklahoma and Wisconsin jackpots.

Iowa's $16 million jackpot was never redeemed because lottery officials were unable to verify the authenticity of the winning tickets.

Timeline of the biggest crime in US lottery history

The following is a compilation of Lottery Post news coverage chronicling the Hot Lotto mystery and subsequently discovered crime.

We start the timeline with a news story indicating that only 3 months remained for the $16 million Hot Lotto jackpot to be claimed.

2011

2012

2013

2014

2015

2016

Thanks to ckrakowski for the tip.

CNS, Lottery Post Staff

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12 comments. Last comment 4 months ago by LiveInGreenBay.
Page 1 of 1
haymaker's avatar - Lottery-012.jpg
Egg Harbor twp.south Jersey shore
United States
Member #112968
June 29, 2011
3850 Posts
Offline
Posted: July 28, 2016, 8:36 am - IP Logged

Ok, 9 years and 9 months for tampering with the machine/computer !

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

    TheMeatman2005's avatar - lightening
    Brooklyn, NY
    United States
    Member #169723
    October 29, 2015
    877 Posts
    Offline
    Posted: July 28, 2016, 9:21 am - IP Logged

    With today's judicial system, sometimes the punishment doesn't fit the crime.

    The Meatman

    “The quickest way to double your money is to fold it in half and put it in your back pocket.” Will Rogers

    Winning happens in a flash, Like A Bolt Of Lightning!  Patriot

      music*'s avatar - nw bookeep.jpg
      Happy California
      United States
      Member #157856
      August 2, 2014
      1506 Posts
      Offline
      Posted: July 28, 2016, 5:32 pm - IP Logged

      He has ruined his own life. He has to fight more court battles. Eddie Tipton.

       I've been rich and I've been poor. Believe me, rich is better. 

       Attributed to Joe E. Lewis and others

        Kingofearth's avatar - Kinnak
        Upstate NY
        United States
        Member #174656
        May 5, 2016
        750 Posts
        Offline
        Posted: July 29, 2016, 1:02 am - IP Logged

        I checked most of the links but i don't see his annual salary from his position anywhere. Does anyone know what it is? I know it doesn't make much of a difference but it does put things in perspective if he was making say $50,000 at such a high job or make it even more ridiculous if he was paid say $700,000. I made both of these up at the top of my head if anyone asks where I'm getting them from.

          LiveInGreenBay's avatar - driver
          Green Bay
          United States
          Member #169391
          October 15, 2015
          1238 Posts
          Offline
          Posted: July 29, 2016, 12:12 pm - IP Logged

          Found a daily beast article that states he received a six figure salary as director of security. 

          http://www.thedailybeast.com/articles/2015/07/07/inside-the-biggest-lottery-scam-ever.html

          Never give up.  Banana

            helpmewin's avatar - dandy
            u$a
            United States
            Member #106665
            February 22, 2011
            19727 Posts
            Offline
            Posted: July 29, 2016, 2:06 pm - IP Logged

            With today's judicial system, sometimes the punishment doesn't fit the crime.

            I Agree!

            Let it Snow Snowman

              Kingofearth's avatar - Kinnak
              Upstate NY
              United States
              Member #174656
              May 5, 2016
              750 Posts
              Offline
              Posted: July 29, 2016, 2:10 pm - IP Logged

              Found a daily beast article that states he received a six figure salary as director of security. 

              http://www.thedailybeast.com/articles/2015/07/07/inside-the-biggest-lottery-scam-ever.html

              6 figures makes it even more ridiculous what he did. Even the lowest 6 figure amount (100,000) is enough to be well off in a low cost of living place like Iowa.Plus what could he really do with the money  if he was able to get away with it? I'm sure such a high position would get audited and scrutinized a lot and he can't exactly put it down on his tax returns as gambling income.The more you look into the nitty gritty and less into the movie style big picture, the more ridiculous and bird-brained his actions become.

                Sunglasses's avatar - nicebear
                Zaperlopopotam
                Belgium
                Member #173932
                March 26, 2016
                950 Posts
                Offline
                Posted: August 2, 2016, 10:48 am - IP Logged

                Mr Tipton said that he was going to do it. He did. So what now? Where is the won money? How exactly did he cheat? Too many questions! At least, nobody was killed or injured?

                  Sunglasses's avatar - nicebear
                  Zaperlopopotam
                  Belgium
                  Member #173932
                  March 26, 2016
                  950 Posts
                  Offline
                  Posted: August 2, 2016, 10:49 am - IP Logged

                  6 figures makes it even more ridiculous what he did. Even the lowest 6 figure amount (100,000) is enough to be well off in a low cost of living place like Iowa.Plus what could he really do with the money  if he was able to get away with it? I'm sure such a high position would get audited and scrutinized a lot and he can't exactly put it down on his tax returns as gambling income.The more you look into the nitty gritty and less into the movie style big picture, the more ridiculous and bird-brained his actions become.

                  Whistle?

                    Kingofearth's avatar - Kinnak
                    Upstate NY
                    United States
                    Member #174656
                    May 5, 2016
                    750 Posts
                    Offline
                    Posted: August 2, 2016, 3:14 pm - IP Logged

                    Whistle?

                    ? What about a whistle?

                      Sunglasses's avatar - nicebear
                      Zaperlopopotam
                      Belgium
                      Member #173932
                      March 26, 2016
                      950 Posts
                      Offline
                      Posted: August 2, 2016, 3:32 pm - IP Logged

                      You don't know whistling!

                        LiveInGreenBay's avatar - driver
                        Green Bay
                        United States
                        Member #169391
                        October 15, 2015
                        1238 Posts
                        Offline
                        Posted: August 2, 2016, 4:40 pm - IP Logged

                        I may take heat for this post but (in a small way) you have to admire what Tipton did.  He scammed the scammer's.  Do away with pre-tests and I may change my opinion.  Pre-tests serve only one purpose...To hide trends from people who follow them.

                        Never give up.  Banana