KANSAS CITY, Mo. — A lawsuit by the state of Kansas accuses the man at the center of a multi-state lottery number-fixing scam of working with two others to redeem two rigged lottery tickets for $44,000.
Kansas Attorney General Derek Schmidt announced Tuesday he filed the Shawnee County lawsuit against Eddie Tipton and two others who Schmidt says turned in the tickets to the Kansas Lottery. Schmidt alleges Tipton used software manipulation to rig the tickets.
Tipton, 54, of Flatonia, Texas, once worked as the information security director for the Iowa-based Multi-State Lottery Association, writing software designed to randomly pick numbers for lottery computers used for various games by 37 state and territorial lotteries.
Tipton, who was convicted in Iowa of lottery fraud in 2015, does not have a listed home telephone number and could not be reached for comment Wednesday. His Iowa attorney, Dean Stowers, didn't respond to a message left by The Associated Press.
According to the Kansas lawsuit, Tipton bought two lottery tickets in December 2010 from gas stations in Overland Park and Emporia, then gave one each to Amy Demoney and Christopher McCoulskey to redeem.
Those tickets, the lawsuit alleges, were rigged to win by Tipton's software manipulation through his job at the multi-state lottery. Between February and June of 2011, Demoney and McCoulskey submitted the tickets to the Kansas Lottery and were paid a total of $44,008, giving a portion of the proceeds to Tipton.
While seeking repayment of the $44,000, the Kansas lawsuit also seeks unspecified civil penalties for Kansas False Claims Act violations.
McCoulskey, of Denton, Texas, told to the AP by telephone on Tuesday that he bought the "winning" ticket from Tipton for $8,000, then redeemed it by mail after Tipton told him he didn't want the tax hassles that came with doing it himself.
McCoulskey, a 51-year-old childhood acquaintance of Tipton, said he was unaware the ticket was bogus. "I just assumed it was a lottery ball game and that no one could tamper with it," he said.
"As far as I was concerned, it was a good ticket," McCoulskey said, adding he stood prepared to pay restitution to Kansas. The lawsuit "is a shock. If they thought there was an issue in Kansas, they could just contact me and say, 'You need to settle up.'"
Demoney, 43, of Waukee does not have a listed home telephone number and could not be reached Wednesday.
Tipton and his brother — Tommy Tipton, a former Texas justice of the peace — are awaiting trial in Iowa, where they're accused of tinkering with computers to make lottery numbers predictable in various states. They deny the charges.
Prosecutors allege Eddie Tipton took advantage of a false, random number-generating program he designed and placed in lottery computers that allowed him to predict winning numbers on specific days of the year. Investigators say Tipton and his associates used that knowledge to buy winning tickets worth millions of dollars in Colorado, Oklahoma, Wisconsin, Kansas and Iowa between 2005 and 2011.
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.
- Iowa Lottery security chief bent on determining identity of jackpot winner, Jan. 10, 2012
- NY lawyer in lottery mystery travels to Iowa this week, Jan. 17, 2012
- Iowa Lottery security chief to grill NY lawyer over Hot Lotto ticket, Jan. 17, 2012
- Representative of Hot Lotto winner named in lawsuit, Jan. 20, 2012
- Hot Lotto trust representative won't name winner, Jan. 20, 2012
- Iowa Lottery threatens to deny jackpot payout if winner stays anonymous, Jan. 23, 2012
- Lawyer gives up $14 million Iowa lottery ticket claim, Jan. 26, 2012
- $14.3 million Hot Lotto prize claim withdrawn, Jan. 27, 2012
- Iowa Legislators satisfied with Lottery's handling of mystery jackpot winner, Feb. 1, 2012
- Iowa Lottery to give away millions from jackpot mystery, Feb. 26, 2012
- Iowa Lottery director: 50-50 that Hot Lotto mystery will be solved, Aug. 9, 2012
- Iowa officials trying to solve lotto mystery, may release surveillance video, Aug. 19, 2012
- MUSL employee arrested in Hot Lotto jackpot mystery, Jan. 15, 2015
- BOMBSHELL: MUSL employee might have rigged Hot Lotto computerized drawing, Apr. 13, 2015
- Texas man charged in Iowa lottery case contests extradition, Apr. 20, 2015
- Extradition trial begins this week in $16.5M Hot Lotto fraud case, Jun. 7, 2015
- Inside the biggest lottery scam ever, Jul. 7, 2015
- Trial underway in world's biggest lottery fraud case, Jul. 14, 2015
- Lottery security chief: Rigging computerized game "sadly" possible, Jul. 15, 2015
- Prosecution rests in Hot Lotto trial, Jul. 16, 2015
- Defense quickly wraps up in Hot Lotto trial, Jul. 16, 2015
- Hot Lotto case moves to jury for deliberations, Jul. 17, 2015
- Former lottery security employee guilty of rigging $14.3M drawing, Jul. 20, 2015
- MUSL security worker who rigged drawing gets 10 years, Sep. 9, 2015
- HOT LOTTO DRAWING CHEAT CHARGED WITH RIGGING MORE JACKPOTS, Oct. 9, 2015
- Texas authorities had previously investigated brother of lottery cheat, Oct. 14, 2015
- Another $1.2M Hot Lotto jackpot rigged by Tipton, officials say, Nov. 21, 2015
- Jackpot-fixing investigation expands to more state lotteries, Dec. 18, 2015
- Prosecutors say Tipton rigged two jackpots he purchased tickets for in Kansas, Dec. 21, 2015
- Maine gives names of Hot Lotto winners to Iowa team looking into rigging scheme, Dec. 23, 2015
- S.C. Lottery assures public no computerized drawings used in state, Dec. 23, 2015
- Kansas lottery players questioning game's integrity, Dec. 23, 2015
- MUSL CHIEF OUSTED OVER JACKPOT-RIGGING SCANDAL, Dec. 23, 2015
- Lottery scandal unlikely to affect New Mexico, official says, Dec. 26, 2015
- Tipton granted delay in next trial until July, Dec. 29, 2015
- Iowa Lottery CEO Terry Rich to answer lottery player questions live Monday evening, Jan. 11, 2016
- First lawsuit in state lottery-fixing scandal seeks millions, Feb. 4, 2016
- MUSL seeks to dismiss lawsuit over rigged jackpot, Apr. 1, 2016
- Lottery scammer's brother facing criminal charges, Apr. 6, 2016
- Investigators find Tipton's software code to rig computerized lottery drawings, Apr. 7, 2016
- Lottery rigging scandal prompts security audit in South Dakota, Apr. 13, 2016
- Preliminary hearing rescheduled for Tommy Tipton in lottery rigging case, Apr. 22, 2016
- Third suspect surrenders in national lottery rigging scandal, Apr. 28, 2016
- Lottery scam investigation comes to Tennessee, May 11, 2016
- Investigators find another friend of Tipton who cashed rigged lottery prize, May 11, 2016
- Convicted computerized drawing fraudster argues Iowa court appeal, Jun. 16, 2016
- US Senate panel demands info in lottery scandal, Jun. 22, 2016
- Lottery rigging trial to be moved out of Des Moines, Jun. 27, 2016
- Eddie Tipton's new trial delayed until 2017, Jul. 1, 2016
- Iowa court reverses part of Tipton's lottery fraud conviction, Jul. 28, 2016
- Internal investigation concludes Tipton acted alone to rig lottery drawings, Aug. 10, 2016
- Prosecutors say 2 more men may be linked to lottery riggings, Aug. 24, 2016
- Judge: winner's lawsuit in lottery-fixing case can continue, Oct. 13, 2016
- Alleged lottery scandal conspirator to enter new plea, Nov. 14, 2016
- Accused lottery rigger Eddie Tipton facing new Wisconsin charges, Dec. 22, 2016
- Man files lawsuit over rigged lottery jackpots, Jan. 4, 2017
- Trials for Tipton brothers charged in lottery scandal delayed, Jan. 8, 2017
- Former MUSL official received severance amid lottery jackpot scandal, Jan. 10, 2017
- Texas man pleads guilty to fraud in lottery scandal case, Jan. 11, 2017
- Iowa Supreme Court hears lottery rigging case, Feb. 14, 2017