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NJ man admits running illegal "Pick 6" lottery, evades $65,000 in taxes

Apr 22, 2021, 2:55 pm

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Illegal gambling business took in $250,000

By Kate Northrop

A man from Ocean County, New Jersey pleaded guilty to operating an illegal lottery on Tuesday after having drawn in $250,000 in cash proceeds from the scheme.

Edward O'Neill, 54, of Beachwood appeared before U.S. District Judge Brian R. Martinotti via videoconference and pleaded guilty to charges against him, including one count of managing an illegal gambling business and one count of subscribing to a false tax return.

According to the District of New Jersey, O'Neill evaded more than $65,000 in federal taxes on his earnings.

Case documents and statements made in court detail the scheme that operated between 2014 and 2019, during which O'Neill managed an illegal lottery fashioned after the New Jersey Lottery's Pick 6 draw game.

"Players" participated by paying a $20 entry fee and selected six numbers from a pool of 1 to 49. Participants who matched their numbers to the numbers drawn in the New Jersey Lottery's official Pick 6 game would win a cash prize. O'Neill documented identifying information for each player along with their numbers into ledgers and monitored the Lottery's official Pick 6 results.

The ledgers O'Neill kept recorded up to 8,000 participants in one single drawing of his illegal lottery, with the cash prizes for each drawing often exceeding $100,000.

O'Neill gave himself a 10 percent cut of the winnings for each drawing in exchange for operating and managing the illegal lottery, a press release by the District of New Jersey said. After generating $250,000 in profits and failing to report his earnings on tax returns he filed with the IRS between 2014 and 2018, he skirted his federal income taxes by $65,674.

The maximum penalty for managing an illegal gambling business is five years in prison, while subscribing to a false tax return carries a maximum sentence of three years in prison. For both charges, O'Neill may also be subjected to a $250,000 fine or twice the gross gain or loss from the offenses, whichever is greater.

O'Neill's sentencing is set to take place on Aug. 25, 2021.

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25 comments. Last comment 19 days ago by MillionsWanted.
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Unlucky-Kenny's avatar - Cigar B1.gif
WISCONSIN
United States
Member #202055
November 7, 2019
2007 Posts
Offline

Dang! This has to be one of the most interesting stories I have read on here! 

Thanks Todd.

Can't trust no one from New Jersey!

LOL

Ol' Kenny is going to win big just a loser

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    hearsetrax's avatar - alien on_computer.jpg

    United States
    Member #52343
    May 21, 2007
    3354 Posts
    Offline

    nothing would surprise me about the state of new jersey 😏

      rcbbuckeye's avatar - Lottery-062.jpg
      100
      Texas
      United States
      Member #55887
      October 23, 2007
      11218 Posts
      Offline

      First thing I thought when I saw the headline was it was about Todd.......

      JUST KIDDING!!!!

          Green laugh

      CAN'T WIN IF YOU'RE NOT IN

      A DOLLAR AND A DREAM (OR $2)

        Avatar
        Simpsonville
        United States
        Member #163182
        January 22, 2015
        2534 Posts
        Offline

        Though lotteries (official) weren't around in the 40's this story makes me think of that era, and even before.

        Too many checks and balances to try to pull off an old crime like this.

        Dumpster diving today yielded $10!   Then read an email from KLC that I have a free MM ticket for being a KY Fun Club Member for over a year!   Life is good.

          rcbbuckeye's avatar - Lottery-062.jpg
          100
          Texas
          United States
          Member #55887
          October 23, 2007
          11218 Posts
          Offline

          Though lotteries (official) weren't around in the 40's this story makes me think of that era, and even before.

          Too many checks and balances to try to pull off an old crime like this.

          Dumpster diving today yielded $10!   Then read an email from KLC that I have a free MM ticket for being a KY Fun Club Member for over a year!   Life is good.

          Wouldn't that be a nice surprise if that free MM ticket wins the jackpot.

          CAN'T WIN IF YOU'RE NOT IN

          A DOLLAR AND A DREAM (OR $2)

            Avatar
            Simpsonville
            United States
            Member #163182
            January 22, 2015
            2534 Posts
            Offline

            Wouldn't that be a nice surprise if that free MM ticket wins the jackpot.

            With Covid-19 it is easier, for the time being to remain anonymous.

            If I were to get surprised as you say, I'd have Chip Polston, KLC  contact Todd to do an anonymous story on me!

            Haven't been to Fun Club yet, but I'm sure it won't have a Megaplier...but beggars can't be choosers.   Second place is fine with me!

              Avatar
              Kentucky
              United States
              Member #32651
              February 14, 2006
              9151 Posts
              Offline

              Illegal gambling business took in $250,000

              By Kate Northrop

              A man from Ocean County, New Jersey pleaded guilty to operating an illegal lottery on Tuesday after having drawn in $250,000 in cash proceeds from the scheme.

              Edward O'Neill, 54, of Beachwood appeared before U.S. District Judge Brian R. Martinotti via videoconference and pleaded guilty to charges against him, including one count of managing an illegal gambling business and one count of subscribing to a false tax return.

              According to the District of New Jersey, O'Neill evaded more than $65,000 in federal taxes on his earnings.

              Case documents and statements made in court detail the scheme that operated between 2014 and 2019, during which O'Neill managed an illegal lottery fashioned after the New Jersey Lottery's Pick 6 draw game.

              "Players" participated by paying a $20 entry fee and selected six numbers from a pool of 1 to 49. Participants who matched their numbers to the numbers drawn in the New Jersey Lottery's official Pick 6 game would win a cash prize. O'Neill documented identifying information for each player along with their numbers into ledgers and monitored the Lottery's official Pick 6 results.

              The ledgers O'Neill kept recorded up to 8,000 participants in one single drawing of his illegal lottery, with the cash prizes for each drawing often exceeding $100,000.

              O'Neill gave himself a 10 percent cut of the winnings for each drawing in exchange for operating and managing the illegal lottery, a press release by the District of New Jersey said. After generating $250,000 in profits and failing to report his earnings on tax returns he filed with the IRS between 2014 and 2018, he skirted his federal income taxes by $65,674.

              The maximum penalty for managing an illegal gambling business is five years in prison, while subscribing to a false tax return carries a maximum sentence of three years in prison. For both charges, O'Neill may also be subjected to a $250,000 fine or twice the gross gain or loss from the offenses, whichever is greater.

              O'Neill's sentencing is set to take place on Aug. 25, 2021.

              Many years ago I participated in a similar game which was legal according to the County Prosecutor. We paid $5 ($2.50 per draw) a week to pick six Ohio Lotto numbers and the first to get all six won the prize pool. 

              The ledgers O'Neill kept recorded up to 8,000 participants in one single drawing

              We had 30 at tops and maybe why ours was legal.

              It's not my fault! I voted for Amy.

                Avatar
                New York
                United States
                Member #103596
                January 4, 2011
                6944 Posts
                Offline

                Illegally obtained evidence- fruit of the poisonous tree- is prohibited from admittance but illegally obtained revenue is subject to taxation and even represents a separate crime. Another reminder that all the money is viewed as the governments and we should consider ourselves fortunate that we are allowed to keep any.

                  Avatar
                  Simpsonville
                  United States
                  Member #163182
                  January 22, 2015
                  2534 Posts
                  Offline

                  Many years ago I participated in a similar game which was legal according to the County Prosecutor. We paid $5 ($2.50 per draw) a week to pick six Ohio Lotto numbers and the first to get all six won the prize pool. 

                  The ledgers O'Neill kept recorded up to 8,000 participants in one single drawing

                  We had 30 at tops and maybe why ours was legal.

                  Keyword.....LEGAL in your case!

                    Avatar
                    Kentucky
                    United States
                    Member #32651
                    February 14, 2006
                    9151 Posts
                    Offline

                    he skirted his federal income taxes by $65,674.

                    It says O'Neill collected up to $160,000 per drawing for five years and at 10% should have made around 6 million. Nice of the IRS charging less than 2% for taxes.

                    It's not my fault! I voted for Amy.

                      s5thomps's avatar - Lottery-033.jpg
                      Hard Luck, Ak
                      United States
                      Member #23471
                      October 13, 2005
                      391 Posts
                      Offline

                      Why would a person put in 20 dollars on a illegal lottery based on the Jersey Pick 6 when you could play it legally for a $1.00? Makes no sense to me. Plus the payout is higher if you hit!

                      No Pity!

                      "We make a living by what you get, You make a LIFE by what you give!"

                                                                                     Sir Winston ChurchillSun Smiley

                        rcbbuckeye's avatar - Lottery-062.jpg
                        100
                        Texas
                        United States
                        Member #55887
                        October 23, 2007
                        11218 Posts
                        Offline

                        Why would a person put in 20 dollars on a illegal lottery based on the Jersey Pick 6 when you could play it legally for a $1.00? Makes no sense to me. Plus the payout is higher if you hit!

                        No Pity!

                        I was asking myself that also. And he had a list of 8000 players?

                        CAN'T WIN IF YOU'RE NOT IN

                        A DOLLAR AND A DREAM (OR $2)

                          Unlucky-Kenny's avatar - Cigar B1.gif
                          WISCONSIN
                          United States
                          Member #202055
                          November 7, 2019
                          2007 Posts
                          Offline

                          I was asking myself that also. And he had a list of 8000 players?

                          Only thing I can think of is that if they win they wont be filling out a tax form when they collect?

                          haha

                          Ol' Kenny is going to win big just a loser

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                            100
                            New York, NY
                            United States
                            Member #140628
                            March 23, 2013
                            11077 Posts
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                            I'm confused. So he took what 10% of each game. Each game made $100,000? And in 5 years time or whatever he generated $250,000? A little confused. So, trying to figure this out, $10,000 x 25? I don't know.

                            Sometimes you do the right thing just because it’s right.