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Colorado man who unwittingly split a $4.8M jackpot with scammer is fighting the Colorado Lottery

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Colorado LotteryColorado Lottery: Colorado man who unwittingly split a $4.8M jackpot with scammer is fighting the Colorado Lottery
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In 2005, three people won a Colorado Lotto jackpot worth $4.8 million, and Boulder's Amir Massihzadeh held one set of winning numbers.

He accepted his prize of $568,990 — after splitting the pot and paying taxes — and moved on with life.

Ten years later, Colorado Bureau of Investigation agents visited Massihzadeh to interview him about his winning number because they were investigating a criminal scheme to rig lotteries. They suspected the other two ticket-holders who split the prize with Massihzadeh had cheated.

Massihzadeh, who let the computer choose his numbers, was not suspected of wrongdoing.

Even after the other two were convicted in the scam, the Colorado Lottery refused to award the full jackpot to Massihzadeh, saying he was locked into a contract when he signed the original ticket.

Thus began a years-long court battle between Massihzadeh and the state lottery over whether or not he is entitled to the full $4.8 million jackpot. On Tuesday, the Colorado Court of Appeals will hear the case to interpret exactly how contracts between lottery winners and the state should work.

"If an honest person plays a game by the rules, but other players cheat to win and get caught, then the honest player should get the whole jackpot and the cheaters should not get anything," Robert Duncan, one of Massihzadeh's attorneys, said in an email to The Denver Post. "But when we went to the state, it said it did not owe our client anything."

Massihzadeh declined an interview, but his lawyer said his client isn't mad or frustrated. He simply believes the entire jackpot is rightfully his.

Lottery officials referred questions about the case to the Colorado Attorney General's Office, which declined comment because of pending litigation.

When Massihzadeh won nearly 14 years ago he never considered there would be a problem, Duncan said.

What he — and state lottery officials — did not know was that a man in Iowa who worked as director of information security for the Multi-State Lottery Association was installing code to help him and his brother forecast likely winning numbers. The Multi-State Lottery Association is a nonprofit organization owned and operated by 33 state lottery systems, including Colorado's, which use the association's computer system to generate winning numbers.

Eddie Tipton, the security director in Iowa and the mastermind behind the scam, had manipulated the computer program so that he would be able to predict winning numbers, according to previous reports on the scam. Tipton designed the software so that it only operated on certain dates and was dormant the rest of the time to avoid detection. But on those certain dates, odds were high that Tipton knew the numbers that would be chosen.

Tipton provided those potential winning numbers to his brother, Tommy Tipton, who also shared them with others.

After the Nov. 23, 2005, Colorado Lotto numbers were announced, Tommy Tipton, who had received a notepad with likely winning combinations from his brother, gave his winning ticket to a friend, who claimed a lump-sum payout.

Tommy Tipton also had shared those combinations with someone else, and the third winning number was claimed by a Las Vegas limited liability company called Cuestion de Suerte, which also asked for a lump-sum payment.

But the Tiptons got caught after the Iowa Lottery investigated suspicious circumstances surrounding a $16.5 million Hot Lotto ticket purchased in December 2010.

The Tiptons were required by court order to pay Colorado $1,137,980 in restitution: the total amount paid out by the state for the two rigged lottery tickets. They were also ordered to pay restitution in Oklahoma, Wisconsin and Kansas, according to Colorado's response brief in the Court of Appeals case.

The state said in its court filing that the Tiptons have not paid any of the restitution to Colorado and are unlikely to do so. Eddie Tipton is serving two consecutive five-year sentences in the Iowa state prison, it stated.

After the Tiptons' scheme was busted, that left Massihzadeh as the lone holder of a winning Lotto ticket.

Massihzadeh and his attorneys went to the Colorado Lottery to ask for the full payout.

"These criminals knew what no one else did: what the potential winning combination of numbers would be. They were not playing a game of chance like all the honest players," Massihzadeh's attorneys wrote in their opening brief before the appeals court. "For the honest players, like Mr. Massihzadeh, the drawing was still a fair and random game of chance because they had the same opportunity to win when competing against other honest players."

Lottery officials said they did not owe Massihzadeh anything. The original payout was set in a contract both parties had signed, the lottery determined.

Massihzadeh sued.

But a Denver District Court judge dismissed the lawsuit in February 2018, agreeing with lottery officials that Massihzadeh was bound by the original contract.

The state has argued that Colorado law says the lottery cannot be held liable after earnings are paid, and that it technically did not have contracts with the Tiptons because other people claimed the winnings. The criminal convictions had no bearing on Massihzadeh's claim because the winner's shares are determined by the number of matching tickets, not the means by which a player purchases a ticket, the lottery said.

"Massihzadeh, unaware of the fraud, purchased a quick pick ticket. He now claims that the Division's payment of two-thirds of the jackpot to the other ticket holders breached his own contract with the Division," the Colorado Lottery argued in its brief before the appeals court. "In doing so, he entirely disregards the terms of that contract. He also ignores the obvious — he was an unknowing beneficiary of the fraud, not a victim of it. The Division was defrauded of at least $1.6 million in prize money in 2005. Massihzadeh now asks the Division to pay this amount a second time."

On Tuesday, before an audience of high school students in Trinidad, Massihzadeh's lawyers will try to convince the appeals court their client deserves the money and to reverse the district court's decision.

And if he loses?

"He certainly hopes the Court of Appeals will agree with his position, but, if not, then his life will continue to be as good as it has been since 2005," Duncan said.

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

2017

2018

2019

Denver Post

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23 comments. Last comment 8 days ago by noise-gate.
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Simpsonville
United States
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January 22, 2015
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Posted: April 15, 2019, 10:27 am - IP Logged

Tiptons @ it again!

After all these years I say cut your losses, enjoy your over $500K prize and get on with your life.

Though he MAY have been an unwittingly participant in that Tipton mess, I don't foresee him gaining anything and his Attorney getting richer.  IDK.

    TheMeatman2005's avatar - lightening
    Brooklyn, NY
    United States
    Member #169719
    October 29, 2015
    1394 Posts
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    Posted: April 15, 2019, 1:13 pm - IP Logged

    The article states that "In 2005, three people won a Colorado Lotto jackpot worth $4.8 million, and Boulder's Amir Massihzadeh held one set of winning numbers.

    He accepted his prize of $568,990 — after splitting the pot and paying taxes — and moved on with life."

    If $4,800,000 divided by three is $1,6000,000 and the federal tax rate for 2005 was 35% and the Colorado income tax rate was 4.63%, then

    $1,600,000 x 35% = $560,000

                        4.63% = $74,080

    Total taxes due = $634,080 which should have left $965,920.

    Why did he get only $568,990?

    By my calculations, he should have received approximately $965,920

    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

      noise-gate's avatar - images q=tbn:ANd9GcR91HDs4UJhjxO7cmeMQWZ5lB_FOcMLOGicau4V74R45tDgPWrr
      Chasing the Dream.
      White Shores- California
      United States
      Member #136473
      December 12, 2012
      5670 Posts
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      Posted: April 15, 2019, 2:10 pm - IP Logged

      Tiptons @ it again!

      After all these years I say cut your losses, enjoy your over $500K prize and get on with your life.

      Though he MAY have been an unwittingly participant in that Tipton mess, I don't foresee him gaining anything and his Attorney getting richer.  IDK.

      I Agree!- The other thing is Duncan seems to think that since he's client was made aware of a lottery scheme, that the agents were inadvertently telling Amir to go after the money that did not end up with him. Duncan says his client isn't  " mad or frustrated" that's a lie, he is. Amir has been going at it for years, trying to get the rest of the money which he thinks is rightfully his.It's similar to going out to an expensive restaurant, leaving bones on your plate, and then complaining to the management that your stomach is upset, so you shouldn't pay for the meal. Amir is looking for a free meal, in other words * extra money.

       * Voice of Reason *   

       

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

        BuyLow's avatar - fd725949c52faf3bef0a9e377747408d -iphone-wallpaper-palm-trees.jpg
        Florida
        United States
        Member #61433
        May 22, 2008
        1140 Posts
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        Posted: April 15, 2019, 2:16 pm - IP Logged

        The article states that "In 2005, three people won a Colorado Lotto jackpot worth $4.8 million, and Boulder's Amir Massihzadeh held one set of winning numbers.

        He accepted his prize of $568,990 — after splitting the pot and paying taxes — and moved on with life."

        If $4,800,000 divided by three is $1,6000,000 and the federal tax rate for 2005 was 35% and the Colorado income tax rate was 4.63%, then

        $1,600,000 x 35% = $560,000

                            4.63% = $74,080

        Total taxes due = $634,080 which should have left $965,920.

        Why did he get only $568,990?

        By my calculations, he should have received approximately $965,920

        Lump sum amount is less than if paid as an annuity.

          TheMeatman2005's avatar - lightening
          Brooklyn, NY
          United States
          Member #169719
          October 29, 2015
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          Posted: April 15, 2019, 5:05 pm - IP Logged

          Lump sum amount is less than if paid as an annuity.

          Ahhhh. Brain fart on my part. I forgot about that.

          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

            cottoneyedjoe's avatar - cuonvFT

            United States
            Member #197118
            March 28, 2019
            33 Posts
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            Posted: April 15, 2019, 5:19 pm - IP Logged

            The state said in its court filing that the Tiptons have not paid any of the restitution to Colorado and are unlikely to do so.

            That's Colorado's problem, not Massihzadeh's. It's irrelevant to the case unless CO is making the argument that it doesn't have the money to pay Massihzadeh, which it isn't. CO is only making the argument that they don't have to pay Massihzadeh due to contract. In fact, the CO Lottery has its financial report prominently displayed on its website, showing the lottery to be very profitable and solvent.

            According to a DesMoines Register article from December 2018, the Tipton brothers are still worth about 1.8 million, so it is not as if CO can never get their money back, it's that CO simply chooses not to pursue restitution. I think CO weakens its case by mentioning this stuff about not getting its restitution from the Tiptons. It should just stick to the issue of contract.

             

            Frankly, it's such a small amount of money at stake, if I were Massihzadeh I would cut my losses and move on with my life.

              music*'s avatar - Trek HAND1.gif
              Fresno, California
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              Posted: April 15, 2019, 5:27 pm - IP Logged

              Criminals ruin life for the rest of us. 

               Equal Justice for all. 

                "May You Live Long and Prosper" Spock on Star Trek. A Vulcan.

                noise-gate's avatar - images q=tbn:ANd9GcR91HDs4UJhjxO7cmeMQWZ5lB_FOcMLOGicau4V74R45tDgPWrr
                Chasing the Dream.
                White Shores- California
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                Posted: April 15, 2019, 5:32 pm - IP Logged

                The wording that will drive a stake through Duncan’s lawsuit..

                “ The division was defrauded of at least $1.6 million in prize money in 2005.Massihzadeh now asks the Division to pay this amount a second time.” Hit the road Jack and don’t.....

                 * Voice of Reason *   

                 

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

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                  Kentucky
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                  Posted: April 15, 2019, 6:49 pm - IP Logged

                  Ten years later, Colorado Bureau of Investigation agents visited Massihzadeh to interview him about his winning number because they were investigating a criminal scheme to rig lotteries. and Massihzadeh, who let the computer choose his numbers, was not suspected of wrongdoing.

                  I guess it's possible to make a self pick look like a QP, but the lottery has the ticket and know exactly what it was and where it was purchased. So it's baffling as to why they interviewed Massihzadeh

                  There are legal precedents when there were multiple winning tickets and when one or more those prizes never collected, the other winners sued. In the cases I saw, each time the court ruled in favor of the lottery. This case is much different because the Colorado Lottery did payout the other prizes. There may be a case if the prize money is returned; good luck with that. 

                  We'll probably read stories about the "Tipton effect" for years, so why are states like Colorado still using the same type of drawings they know can be rigged?

                    ecnirP's avatar - prince symbol_black-mini.jpg
                    Farmington Hills
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                    Posted: April 15, 2019, 7:00 pm - IP Logged

                    After reading this article, I'm not taking sides. The state has an interesting position in saying that Amir would not have won with his quick pick had Tipton not forced those numbers to come up, and essentially be grateful he got what he did from Tipton's fraud.Sulk Off

                      noise-gate's avatar - images q=tbn:ANd9GcR91HDs4UJhjxO7cmeMQWZ5lB_FOcMLOGicau4V74R45tDgPWrr
                      Chasing the Dream.
                      White Shores- California
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                      Posted: April 15, 2019, 7:53 pm - IP Logged

                      After reading this article, I'm not taking sides. The state has an interesting position in saying that Amir would not have won with his quick pick had Tipton not forced those numbers to come up, and essentially be grateful he got what he did from Tipton's fraud.Sulk Off

                      You make a valid point- Amir was a beneficiary of Tipton’s scheme. If anything, Amir should be thanking Eddie for getting something out of a drawing Tipton set up. 

                       * Voice of Reason *   

                       

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

                        hlamb's avatar - batman47
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                        sarasota,fl
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                        Posted: April 15, 2019, 8:42 pm - IP Logged

                        You are both wrong. Tipton's scheme allowed him to know what possible group of numbers would come and a possible time frame. It did not make the computers generate the numbers themselves so the quick pick was a legitimate win and Amir was not a beneficiary of Tipton's fraud.

                          grwurston's avatar - Lottery-012.jpg
                          I Am Going to Win Today.
                          bel air maryland
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                          Posted: April 15, 2019, 8:57 pm - IP Logged

                          You are both wrong. Tipton's scheme allowed him to know what possible group of numbers would come and a possible time frame. It did not make the computers generate the numbers themselves so the quick pick was a legitimate win and Amir was not a beneficiary of Tipton's fraud.

                          I Agree!  If not Amir, it could have just as easily been someone else. Plus we don't know if Amir bought his ticket before or after Tipton rigged the computer. Not only that, but there is always the chance that if Amir had more than one ticket he could have won even if Tipton had not rigged the drawing.

                          "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.

                          Every lottery system can be improved. If you're not winning almost every day, yours can be made better.

                            noise-gate's avatar - images q=tbn:ANd9GcR91HDs4UJhjxO7cmeMQWZ5lB_FOcMLOGicau4V74R45tDgPWrr
                            Chasing the Dream.
                            White Shores- California
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                            Posted: April 15, 2019, 9:05 pm - IP Logged

                            You are both wrong. Tipton's scheme allowed him to know what possible group of numbers would come and a possible time frame. It did not make the computers generate the numbers themselves so the quick pick was a legitimate win and Amir was not a beneficiary of Tipton's fraud.

                            Ok, you win. It was a shot in the dark. First mistake of the year, not bad.Big Smile

                             * Voice of Reason *   

                             

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