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Lottery rigger warned officials about computerized drawing machines years ago

Oct 15, 2017, 8:54 am

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By Jason Clayworth

The mastermind behind a national lottery scam says he warned officials about a glitch in computer-generated drawings 11 years ago, but "nobody seemed too worried," his lawyer revealed in an exclusive interview.

The same glitch — involving identical numbers drawn consecutively or nearly consecutively — occurred again in the past two weeks in Arizona, prompting state officials to offer players a refund.

Eddie Tipton's new behind-bars revelation, paired with the duplicate number drawings in Arizona, indicate ongoing problems that threaten the integrity of U.S. lottery systems, critics contend.

"How many of these types of events need to occur before you do in fact create that perception of 'Why play? It's rigged anyway?'" asked Dan Zitting an executive of ACL, a software company based in Vancouver, Canada, that works with more than 900 state and federal government agencies. "I would certainly want to get ahead of it if I were the lottery commission."

Tipton, a longtime computer programmer in the Iowa offices of the Multi-State Lottery Association (MUSL), was sentenced in August to up to 25 years in prison for his role in rigging games in Iowa, Colorado, Wisconsin, Kansas and Oklahoma.

He designed and installed code that allowed him to predict winning numbers drawn every May 27, Nov. 23, and Dec. 29 in non-leap years, investigators said. The resulting rigged lotteries netted $2 million in illegal wins. 

Tipton had already started installing his rigged programming code when he first spotted the random-number flaw after two Wisconsin SuperCash games drew the same six numbers in a 10-day period in 2006.

Tipton contends he alerted Multi-State Lottery Association officials about the duplication flaw soon after the Wisconsin drawings.

"Since Eddie wrote the original code that drew the same numbers, he knew there was a problem and he told someone at MUSL," said West Des Moines Attorney Nick Sarcone, who was given permission by Tipton to speak about the matter with the Register. "But nobody seemed too worried about it other than Eddie Tipton."

Joe Diaz, who assisted Iowa with gaming issues as the Iowa Lottery's former vice president of security and a former assistant director of the Iowa Division of Criminal Investigation, said the Multi-State Lottery Association never told him about the concerns over the duplicate Wisconsin drawings. 

"That is something highly unusual, and with MUSL being right here, it very much should have been investigated how that took place," said Diaz, who retired in 2011. "It's a big deal, and it should have been brought to Iowa's attention."

Ban computer lottery drawings?

The duplicate drawings in Wisconsin in 2006 carried odds of 1 in 326,000, according to the watchdog group Lottery Post, an online lottery watchdog site based in New Jersey.

Tipton told his boss at the Multi-State Lottery Association, Ed Stefan, that computer software used to draw numbers for dozens of state lotteries had a "randomness problem," Sarcone said.

Stefan took the matter seriously, but other Multi-State Lottery Association executives did not see the issue as a critical problem, Sarcone said.

Ultimately, the association instructed Tipton to make a fix, and Tipton did make changes, Sarcone said.

By that time, Tipton's rigged coding had already been embedded in the programming for almost a year before the duplicate Wisconsin drawings, court records indicate.

But the association failed to have multiple people overseeing Tipton's work, Zitting and Diaz said in response to court testimony in Tipton's case and the Wisconsin drawings.

Because of the lack of oversight, the Multi-State Lottery Association missed an opportunity to detect Tipton's rigged coding and remove it before it damaged the credibility of dozens of state lotteries, Zitting and Diaz said.

Moreover, state lottery members of the Multi-State Lottery Association were not notified about the Wisconsin programming error, according to officials who worked at the Iowa Lottery. 

The Multi-State Lottery Association also failed to warn its members following the Arizona duplication glitch, according to Oct. 10 interviews with lottery officials in Iowa and Colorado said.

The lack of system-wide alerts raises serious questions about the integrity of the nation's lottery system, said Todd Northrop, the founder of Lottery Post, who has long advocated for the ban of random computer drawings.

The site's "state lottery report card" indicates that at least 34 states participate in games that use computer-generated numbers.

"No matter how great your (computerized) random drawing allegedly is, there is no way ... to know for 100 percent certainty that you don't have a hack," Northrop said.

The Iowa Lottery is phasing out its only remaining computer drawing game, with Hot Lotto concluding Oct. 28.

Northrop, who has a professional background in computer systems, contends all lotteries should divorce themselves of the Multi-State Lottery Association's computer-generated picks and re-embrace traditional ball-machine drawings.

He questions whether any savings are gained through computer picks if the loss of integrity, lawsuits and other issues are factored in.

"I don't know the answer why they are so dedicated to computerized drawings," Northrop said.

"It might just be because they are easier."

Association remains tight-lipped

Bret Toyne, executive director of the Multi-State Lottery Association, declined multiple requests for an interview, citing ongoing civil litigation related to Tipton's crimes.

Stefan, the association's former chief security officer and Tipton's former supervisor, did not return calls seeking comment.

The association is involved in at least three lawsuits connected with the Tipton scam.

The Register confirmed through Iowa Lottery Director Terry Rich that Tipton had shared the information about the 2006 double drawings in Wisconsin with state investigators following his confession earlier this year.

That information was not part of public court testimony.

Tipton was employed by the Multi-State Lottery Association and was not an Iowa Lottery employee.

But the Iowa Lottery is one of the 36 state or U.S. territory members that owns and operates the Multi-State Lottery Association.

Rich started his role at the Iowa Lottery in 2009. But he said he does not believe that the Multi-State Lottery Association executives notified the Iowa Lottery about Wisconsin's duplicated drawings.

Iowa Lottery Board member Mike Klappholz told the Register in an interview before the Arizona drawing that he believed any problems with computer-generated drawings were fixed and that integrity was restored to the lottery system.

"I've been assured about the random-process generator that is now in place and that integrity at all cost is maintained with checks and balances," said Klappholz, a retired Cedar Rapids Police chief.

Iowa Treasurer Michael Fitzgerald, a nonvoting member of the Iowa Lottery board, said he too had been assured the problems were fixed.

But when the Register spoke with him Sept. 19, he wasn't certain it wouldn't be manipulated again — a significant concern given that the national lottery system had $80.5 billion in sales last year.

"I think you're talking about human nature of someone always trying to game the system," Fitzgerald said.

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Des Moines Register

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27 comments. Last comment 3 years ago by Hermanus104.
Page 1 of 2
haymaker's avatar - Lottery-012.jpg
Egg Harbor twp.south Jersey shore
United States
Member #112964
June 29, 2011
4135 Posts
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Posted: October 15, 2017, 9:38 am - IP Logged

Reminds me of the casino execs...they only see what they want to see !

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

    gregs241's avatar - animal shark.jpg
    Grantsburg, WI
    United States
    Member #176116
    July 21, 2016
    1801 Posts
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    Posted: October 15, 2017, 10:10 am - IP Logged

    I'm wondering if "scratch-offs" are printed with the same type of RNG??  kinda takes the fun out of any gambling...........

    I know everything except tonight's winning LOTTO numbers LOL

      Avatar
      New Member
      Elizabeth, NJ
      United States
      Member #171098
      December 30, 2015
      5 Posts
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      Posted: October 15, 2017, 10:52 am - IP Logged

      Computerized drawings can easily be manipulated. In the article it was stated by Northrup, "I don't know the answer why they are so dedicated to computerized drawings. It might just be because they are easier." This is not why there is so much dedication to computerized drawings. The focus seems to have always been on the cheater who uses these compromised numbers to select winning numbers. Shouldn't the focus be on the actual lottery commissions that use computerized drawings? After all, the lottery commissions know before the draw of all of the ticket numbers that have been purchased. How hard would it be for a competent computer programmer to make sure NONE of the lottery tickets that were purchased will match the computer generated numbers? In other words, the computer generated numbers are selected AFTER all of the purchased lottery tickets have been recorded. This would certainly "generate" more income for the lottery (and those in cahoots) as there would be a guarantee to them that there would be no payout on any given date. Another possibility is that instead of making sure that NO ONE has purchased a winning ticket, the lotteries could just make sure that the least possible winners are generated. This would make it a little less obvious that the winning tickets were manipulated. All of these possibilities revolve around whether or not a person believes the lottery is always on the up and up. Where there is so much money at stake there will be illegal and criminal activity. Websites like Lottery Post are valuable to the people because every so often underhanded activity is brought to light.

        OneTrickpony's avatar - rocking horse.jpg

        United States
        Member #167652
        July 25, 2015
        118 Posts
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        Posted: October 15, 2017, 11:11 am - IP Logged

        Great article.  Seems like a lot of lottery officials are dumbfounded as to how to fix the problem when it is pretty obvious.  Get rid of RNG's!  Geez!  When the guy who manipulated the system tells you that the system is broken, it doesn't take a konk on the head with a sledgehammer to figure it out. 

          Avatar
          Wyomissing, PA
          United States
          Member #161045
          November 15, 2014
          481 Posts
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          Posted: October 15, 2017, 11:31 am - IP Logged

          PA Treasure Hunt (5/30 game: 1 in 142,506) had duplicate numbers drawn too within a week of each other. 02 05 08 11 12 on both Monday Nov-24-2014 and Sunday Nov-30-2014. Mentioned this previously recently, and now seeing a 2nd article regarding RNG draw dups, I wonder even more about PA Lottery RNGs. Do they use machines running similar RNG programming?

          As for instant tickets, they're pre-determinate. Intentionally not random by design. I'm not aware of any U.S. lottery that fully discloses how instant tickets are seeded, prize distributions, winners remaining (sure there are lists, but they don't distinguish between sold and claimed; a few lotteries mention this issue in a disclaimer), game closing procedures, etc. Heck, many lotteries don't even disclose prize winning odds. It's basically a mystery leaving much room for abuse...

          For those who believe there's much abuse with numbers draw RNGs, I'd wager there's far more going on with instant tickets. Instant ticket sales comprise the bulk of sales for many lotteries now. For PA Lottery, it was over 68% of all lottery sales in fiscal year 2016-2017. Add in PA Fast Play (essentially virtual instant tickets) and it's closing in on 70%. The near total lack of transparency with instants make RNG draws seem relatively open in comparison. I harp on this, because it's near certain there is huge wide-scale abuse going on that's just waiting to be uncovered.

          Getting back to the topic at hand, has anyone read any further details regarding the recent AZ Lottery dup numbers incident?  I can't understand how any decent RNG, even with a faulty seed, could duplicate all those draws exactly. I was thinking lottery officials simply forgot to clear the machine's memory, but seems that's not the case?...

          So that leaves more disturbing possibilities, such as the RNG programming being among the worst ever and/or there's still some rigged code lurking in RNG draw machines throughout the country, likely including the PA Lottery (for day draws).

            Artist77's avatar - batman14

            United States
            Member #121741
            January 16, 2012
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            Posted: October 15, 2017, 12:02 pm - IP Logged

            We really are a watchdog group, aren't we? Never thought of it that way before.

            Je vous salue, Marie, pleine de grace.  We will rebuild!

              Avatar
              Morristown, TN
              United States
              Member #20592
              August 21, 2005
              480 Posts
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              Posted: October 15, 2017, 12:20 pm - IP Logged

              Wink  It is time to contact all state lotteries that use RNG and INFORM THEM OF A NATION WIDE BOYCOTT OF ALL STATES THAT USE THEM. TO GET THEIR ATTENTION .......GET IN THEIR BILLFOLD.. SLOWING SALES ALWAYS GETS THEIR ATTENTION.. TENNESSEE LOTTERY  USES RNG AND THE DRAWS ARE RIGGED FOR SURE.... JUST EXAMINE THE PAYOUTS AND THE NUMBERS THAT ARE DRAWN. BOYCOTT NOW !!!!!! Lep

                Avatar
                Chasing $ Millions.
                White Shores- California
                United States
                Member #136473
                December 12, 2012
                6207 Posts
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                Posted: October 15, 2017, 2:02 pm - IP Logged

                If only it were possible for all RNG games to end up here...

                • Image result for city dump

                 * Voice of Reason *   

                 

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

                  Avatar
                  Chasing $ Millions.
                  White Shores- California
                  United States
                  Member #136473
                  December 12, 2012
                  6207 Posts
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                  Posted: October 15, 2017, 2:17 pm - IP Logged

                  Tipton's attorney's remarks reminds me of  Red Reddington's modus operandi- " l will tell you who & where the bad guys are, even though l myself am a bad guy...

                   

                  The mastermind behind a national lottery scam says he warned officials about a glitch in  computer-generated drawings 11 years ago, but "nobody seemed too worried," his lawyer revealed in an exclusive interview.

                   * Voice of Reason *   

                   

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

                    grwurston's avatar - Lottery-012.jpg
                    Win Today.
                    bel air maryland
                    United States
                    Member #90247
                    April 24, 2010
                    9107 Posts
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                    Posted: October 15, 2017, 3:17 pm - IP Logged

                    Tipton's attorney's remarks reminds me of  Red Reddington's modus operandi- " l will tell you who & where the bad guys are, even though l myself am a bad guy...

                     

                    The mastermind behind a national lottery scam says he warned officials about a glitch in  computer-generated drawings 11 years ago, but "nobody seemed too worried," his lawyer revealed in an exclusive interview.

                    He told them about the glitch, they didn't care, and he knew at that point they were not going to investigate it. So then it was "game on."

                    Kind of reminds me of that scene in the movie San Quinton. Clint Eastwood wanted to take something from the shop he was working in back to his cell. He showed it to the guard and asked "can I take this back to my cell?" The guard said no and took it. Meanwhile he had a second one hidden in the heel of his shoe.

                    "You can observe a lot just by watching." Yogi Berra, Hall of Fame baseball player.

                    The numbers will tell you what numbers to play. Pay attention to the numbers.

                    Be willing to try a new strategy. If it doesn't work, try a different one.

                      Avatar
                      east orange
                      United States
                      Member #181108
                      April 8, 2017
                      84 Posts
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                      Posted: October 15, 2017, 5:52 pm - IP Logged

                      I dont know but I was able to predict the 600 million powerball in 01/2016 so i'm not worried about the game being rigged.

                        TheGameGrl's avatar - Lottery-012.jpg
                        A long and winding road
                        United States
                        Member #17083
                        June 10, 2005
                        6407 Posts
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                        Posted: October 15, 2017, 6:00 pm - IP Logged

                        If only it were possible for all RNG games to end up here...

                        • Image result for city dump

                        your signature line says everything we need to know about the RNG system and its flaw....

                         

                        It was done right out in the open. Tipton Told people..and then proceeded to reap the rewards from this snafu. 

                        I've little regard for his madness as most folks have integrity in their field of work. He exploited it. 

                         

                        I'm not against RNG draws....its a good concept in theory. Its the human factor often that can make or break it...

                        3443 2445 1220 1500 1320

                        Value that which cannot be bought or sold.

                          Avatar
                          Chasing $ Millions.
                          White Shores- California
                          United States
                          Member #136473
                          December 12, 2012
                          6207 Posts
                          Offline
                          Posted: October 15, 2017, 7:59 pm - IP Logged

                          He told them about the glitch, they didn't care, and he knew at that point they were not going to investigate it. So then it was "game on."

                          Kind of reminds me of that scene in the movie San Quinton. Clint Eastwood wanted to take something from the shop he was working in back to his cell. He showed it to the guard and asked "can I take this back to my cell?" The guard said no and took it. Meanwhile he had a second one hidden in the heel of his shoe.

                          Humphrey Bogart was in San Quentin the movie, back in 1937.Is that the movie you describing G? The other thing, in paragraph 7 of this article: Tipton had already started installing his rigged programming code when he first spotted the random-number flaw. He was there first! So by his account, this conscientious programmer was being honest, and being dishonest at the same time. 

                           * Voice of Reason *   

                           

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

                            grwurston's avatar - Lottery-012.jpg
                            Win Today.
                            bel air maryland
                            United States
                            Member #90247
                            April 24, 2010
                            9107 Posts
                            Offline
                            Posted: October 15, 2017, 8:11 pm - IP Logged

                            Humphrey Bogart was in San Quentin the movie, back in 1937.Is that the movie you describing G? The other thing, in paragraph 7 of this article: Tipton had already started installing his rigged programming code when he first spotted the random-number flaw. He was there first! So by his account, this conscientious programmer was being honest, and being dishonest at the same time. 

                            NG, 

                             I should have Googled it first. It was Escape from Alcatraz. My mistake, I got my prison movies  mixed up. At least I was in the right state. Either way, it was a good movie.

                            Yep. He spotted the flaw, while he was trying to scam the system. If they had looked into it, maybe he would have deleted his program and not done it. But they didn't and he did. And as they say, the rest is history.

                            "You can observe a lot just by watching." Yogi Berra, Hall of Fame baseball player.

                            The numbers will tell you what numbers to play. Pay attention to the numbers.

                            Be willing to try a new strategy. If it doesn't work, try a different one.