Texas Lottery Winners Denied Prizes
(Store Clerks Are Stealing Your Prizes)
Canada Lottery Responds To Luck of the Draw Documentary
- Issues Press Release - Shown Below - It's A "Step" In The Right Direction

Posted: Thursday, Nov 9, 2006 - 11:10 PM
Revised: Nov 10, 2006 - Added 3 Newspaper Stories

Comments From Dawn Nettles - Lottoreport.com
With reference to what you will read below - Just last month, I - once again -
brought these very issues up during the Commission meeting. Needless to say, the
Commissioners just listened but made no comment. I covered everything that you'll
read below and things that were covered in "Luck of the Draw" documentary. I even
made Sunset recommendations years ago suggesting that the Texas Lottery STOP
allowing stores from checking players tickets. It's also been posted on my VIP page
since 2003. The Texas Lottery does NOT care if you receive your small tier prizes
and they do absolutely nothing about clerks stealing from you and terminals erring.
You need to speak up.

I've made a few comments below - they are in blue italics.

Click2Houston.com - KPRC Local 2 TV
Texas Lottery Winners Denied Prize

POSTED: 3:47 pm CST November 9, 2006
UPDATED: 10:31 pm CST November 9, 2006

HOUSTON -- Note: The following story is a verbatim transcript of a Troubleshooters story that aired on Thursday, Nov. 9, 2006, on KPRC Local 2 at 10 p.m.

Local 2 investigates why hundreds of lottery winners aren't getting their money. We discovered players across the state being turned away when they try to cash their winning ticket.

KPRC Local 2 Investigative reporter Robert Arnold has spent the past six months uncovering how the state is letting this happen.

Local 2 Investigates talked with frustrated lottery winners and went to the Lottery Commission in Austin. While officials there know about the problem we discovered little is done to prevent winning tickets from turning up as losers.

"I'm real concerned about the whole process," lottery player Bill Mullen said.

Mullen has a winning lottery ticket he can't cash.

"It means a lot to me from a principle standpoint. It's my money," Mullen said.

After months of beating his head against the wall, he called Local 2 Investigates for help.

We checked Mullen's ticket ourselves and found it was a $3 winner. Armed with hidden cameras, we took Mullen's ticket to four convenience stores. Each one ran it through those blue boxes we all see which are hooked up directly to the Lottery Commission's master computer.

Clerk: "It says, 'Sorry not a winner.'"

Manager: "The machine doesn't lie."

Clerk: "This is not a winner."

Clerk: "That's all I can do."

"I mean if it's happening to me or my wife. How many other people is it happening to?" Mullen said.

Turns out, it happens often. Records obtained by Local 2 Investigates from the Texas Lottery Commission shows in the last four years nearly 1,000 people filed complaints about winning lottery tickets being denied. Fewer than half of these people ever got their money.

"The guy told me the Cash Five ticket was not a winner. I had him recheck it, he said it's not a winner," winner Carl Dauphin said.

Dauphin is just one of those complaints. Terry Mitchell is another.

"I went off. I told him give me my ticket and give me that slip," Mitchell said.

We couldn't understand how winners like Mullen weren't getting their money, so we followed Mullen as he fought to claim his prize.

Our hidden cameras followed Mullen to the Lottery Claim Center off the north loop, where clerks told him all he could do is file a complaint with Austin. So he went home, filled out the forms and sent them off.

Three weeks later he got a response.

"The pile gets deeper doesn't it? This is asinine," Mullen says.

The Lottery Commission's letter told Mullen his ticket was denied because somebody had already claimed the $3 prize. Mullen then called the Commission to find out who received his $3. We found the answer -- they don't know.

But the Lottery official on the other end of the line did tell him the store clerk who first scanned his ticket probably did it improperly.

"They don't realize that they're validating the ticket for a player and they give the player back the ticket and don't give the player their money," said the lottery representative on the phone. "We don't have any control over the integrity of our retailers. We can't control whether they're going to be honest or not with our players."

"This is not uncommon," says Leticia Vasquez, with the Texas Lottery Commission. "It has happened in the past quite a bit."

Vasquez blames the complaints on store employees. She says they aren't trained on how to use the machines , but Vasquez says the Lottery Commission can't force the retailers to take the state's training. As a result, only about 20 percent of retailers ever bother to get their employees trained on the machines.

"It's a little bit like herding cats. You can't always do it, although we try," Vasquez said.

Is it a case of retailers pocketing the cash or just honest mistakes due to a lack of training? Rarely does the Commission find out.

We discovered only about 40 percent of the complaints are followed up with a formal investigation. According to state records, most of the investigations into these complaints end because of "insufficient evidence."

The question the Lottery Commission can't answer is how many people has this happened to who didn't realize it or just didn't want the same hassle Mullen went through.

Mullen did finally get his $3. He says it was a matter of principle because it took him at least two months to collect that money.

The Lottery Commission will take money out of a retailers account if they determine a prize wasn't paid.

The Commission can also revoke a store's license to sell lottery tickets or even file criminal charges, but we've found that's only happened in a handful of cases.

We discovered the problem is happening with prizes below $600. That's because those tickets can be redeemed at any business that sells lottery tickets. Any prize higher than $600 has to be redeemed at an official Lottery Claim Center.

If you have a news tip or question for KPRC Local 2 Investigates, drop them an e-mail or call their tipline at (713) 223-TIPS (8477).

Thank you Click2Houston and Trouble Shooters (KPRC) for this investigation!

- In Response to Luck of the Draw Documentary -
Press Release Issued by OLG - (Canada Lottery)

November 9, 2006

Toronto, November 9, 2006 - Vowing to maintain and reinforce the trust of every lottery player in the province, Ontario Lottery and Gaming Corporation (OLG) has announced a comprehensive package of new and expanded lottery security measures.

"If even one player feels that our systems have failed them in any way, that's one too many," said OLG C.E.O. Duncan Brown. "To anyone who has felt the need to question their trust in OLG, to anyone who feels that we could have done more to protect the integrity of our games, to anyone who feels their concerns were not taken seriously enough, we apologize and we will do better."

Brown announced the immediate implementation of a seven-point action plan designed to reinforce the reputation of Ontario's lottery programs as being among the most secure and stringently administered in North America.

The action plan features technological and human measures, and engages consumers to submit their ideas on enhancing security:

OLG will install, at every lottery terminal location, a device enabling consumers to electronically check their own tickets and to see the value of their prize instantly; (Players Beware: Terminals err in reading the bar codes on tickets - they CAN and DO give false readings. Check your own tickets.)

Lottery retailers will be permitted to check tickets only for those customers who have been asked to sign the back of their tickets. There will be escalating penalties for retailers who fail to follow correct validation procedures, up to and including the removal of their lottery terminals; (Signing tickets won't stop clerks from telling players that their tickets are losers and pocketing winnings under $599. Again, check your own tickets and push for a law to stop clerks from being able to check tickets for players.)

Customer-facing video screens at lottery terminal locations will tell players in larger characters if they've won and if they are a big winner when they have retailers check their tickets;

OLG will conduct a public education campaign to assist consumers to protect themselves;

OLG's special toll-free telephone line will allow consumers to provide the OLG with ideas on additional security measures;

OLG will use an expanded team of professional investigators to probe every win of $10,000 or more by lottery retailers, compared to the current $50,000;

OLG will implement an enhanced complaints process and investigation procedure to improve customer service and to ensure that all accusations are handled effectively and properly.

"We share Minister Caplan and the Provincial Ombudsman's commitment to protecting the public from theft and fraud, and we look forward to the Ombudsman's report," Brown said. "We are taking these steps now to ensure a higher standard of security, and we look forward to receiving the Ombudsman's findings so that we can make even further

"We have listened. We have acted. We will continue to listen to the people of Ontario, and take any further actions required to earn the trust they have placed in us," Brown said.

OLG is a provincial agency responsible for province-wide gaming facilities and lottery games, and generates approximately $2 billion in proceeds for the province to support hospitals, health care, charities and other important public benefits. With revenues of $6 billion and more than 20,000 employees and associates, OLG is one of North America's leading gaming enterprises.

Added The Following Stories Friday, Nov 10, 2006

Security to be tightened for Ontario lotteries
Thursday, November 9, 2006

Ontario's gaming corporation is tightening security measures at lottery terminals in the wake of a CBC investigation that questioned the improbably high number of wins among retailers and clerks.

The Ontario Lottery and Gaming Corp. (OLG) released a list of new lottery security measures Thursday afternoon that include plans to install new electronic devices at every ticket location for lottery players to check their own tickets, devices that are in place in other provinces.

Lottery players in Ontario will soon be able to check their own tickets with new electronic machines the Ontario Lottery and Gaming Corp. plans to install at every location.

(CBC) Under the new rules, retailers and clerks also cannot check a lottery ticket unless the customer has signed the back of the ticket. Those who fail to follow protocol risk the removal of their lottery terminals.

"If we're going to preserve the public's trust, then we have to be seen, and we want to be seen, to be acting in a responsible manner," OLG chief executive officer Duncan Brown said.

In the news release Thursday, the OLG also apologized to customers who felt their complaints were not taken seriously.

The move is an effort to win back the trust of lottery players after an investigation by the CBC's The Fifth Estate reported that lottery ticket sellers in Ontario have won prizes more times than is statistically probable, with the average prize around $500,000.

OLG 'managing' public's feelings: ombudsman

Brown denied the steps were taken to head off an ongoing investigation by Ontario's watchdog, ombudsman André Marin.

'It strikes me that the OLG, in this case, is managing the public and managing their feelings.'

-Ontario ombudsman André MarinA day after the story made national headlines, Marin launched a systemic investigation into how the OLG responds to complaints from customers and what mechanisms are in place to protect them.

Marin called the agency's new security measures a good first step, but said his investigation will go ahead because the corporation has failed to address the way it treats complaints.

"It strikes me that the OLG, in this case, is managing the public and managing their feelings," said Marin.

The ombudsman said he has received 330 complaints about the OLG to date.

Marin's investigation will not look at whether ticket holders actually won lotteries, but rather focus on the OLG's treatment of complaints.

Other measures to signal a win

The Fifth Estate focused on the story of an elderly Ontario man whose $250,000 winning Encore ticket was stolen by clerks in the small town of Coboconk when they pretended it was their own ticket.

Bob Edmonds heard the lottery machine ring, signalling a payout, but the clerk gave him only a free ticket.

He fought for years before the gaming corporation finally recognized the ticket as his and eventually paid him in a confidential settlement.

Other security measures the OLG is taking involve changing the text on video screens that tells customers they've won, making it larger and easier to read.

The corporation will also launch a campaign to educate people on how to protect themselves and begin probing all wins by retailers and clerks of $10,000 and more. Current protocol calls for an investigation into wins of $50,000 and more.

New lottery rules to boost trust
Toronto Star
Nov. 10, 2006

The Ontario Lottery and Gaming Corp. has announced sweeping changes to how prizes are claimed in the wake of allegations that some retailers have been defrauding winners.

Stung by controversy swirling around the province's lotteries after a probe by the CBC's the fifth estate, and facing investigation by Ontario ombudsman André Marin and pressure for changes from Public Infrastructure Renewal Minister David Caplan, the OLG moved yesterday to calm the storm.

The provincial agency has launched a seven-point "trust and security" plan to reinforce public confidence, said OLG chief executive Duncan Brown. The changes range from installation of self-check machines at every lottery terminal to professional investigators who examine winnings of more than $10,000 by lottery winners.

"This is about trust," Brown said.

"This is about retaining and enhancing the players' and the public's trust in us. If we don't have that, we don't have anything."

But the problems for the OLG are far from over. Though Marin called the announcement a positive development, he reported that hundreds of complaints have been brought to the ombudsman's office since the investigation was launched Oct. 26. Marin says people have reported a defensive, unhelpful approach where no thorough investigation ensues.

"We have received, as of this date, 300 complaints from ticket owners who say to us that when they have approached the OLG about being deprived (of) their winnings, they are faced with a wall of silence," Marin said. "That the OLG essentially turns against them and instead of investigating the complaints, investigates the complainants."

Marin says he will continue to look at whether insiders are still winning in disproportionate numbers and, if so, how it is happening and what the corporation is doing to deal with it.

Brown said the company recognizes it can communicate better with the public.

"The announcement today is a recognition on our part that we can do better," Brown said.

The provincial gambling monopoly, which contributed $2 billion to public coffers last year on revenues of $6 billion, will spend more than $10 million to $12 million to improve the integrity of the system, including:

Installing self-check machines at every lottery retail outlet to allow people to check their own tickets, which would tell them if they have won and the amount of their prize. More than 8,800 machines will be installed within the next 12 months.

Forbidding retailers, who would face penalties, from checking any tickets that haven't been signed by lottery players.

Putting "customer-facing video screens" at lottery outlets that would alert players if they have won and letting them know if they are big winners.

Expanding the team of professional investigators probing prize winners and lowering the threshold of those examined from wins of $50,000 to $10,000.

Launching a new public education campaign to help consumers protect themselves.

Opening a new toll-free phone line for suggestions on how security can be further improved.

Enhancing the complaints and investigations process.

The changes came after the fifth estate found store clerks and others who sell or verify lottery tickets were winning disproportionately to people in the general population. The show looked at the case of Bob Edmonds, 83, whose $250,000 winning ticket was switched on him by a clerk in 2001.

Increased lottery security won't dispel fears of retailer fraud: ombudsman

Canadian Press
Chinta Puxley
Thursday, November 09, 2006

TORONTO (CP) - New security measures designed to win back the confidence of lottery fans in Ontario amid allegations of retailer fraud won't satisfy hundreds of ticket buyers who feel they've been cheated out of their prizes, the province's ombudsman said Thursday.

The Ontario Lottery and Gaming Corporation has been "properly chastised" by the hue and cry over allegations that retailers have been winning too much too often, chief executive Duncan Brown said as he unveiled a new strategy to restore consumer confidence in the province's lotteries.

"The public attention over the last two weeks, it certainly caused the whole organization to look at what we do, how we communicate and how we can do things better," Brown said in an interview.

"We can do better and we want to do better . . . we want to retain the trust that (consumers) put in us."

Ombudsman Andre Marin, however, dismissed the strategy - a contrite public apology and a seven-point plan to improve security at lottery kiosks - as little more than an attempt to soothe the "hurt feelings" of the public.

The new measures include devices that allow players to check their own tickets, better use of customer-facing video screens, lowering the threshold for when a retailer's win prompts an investigation and a more robust complaints and investigations system.

"It's a positive first step, but it's not the final step," Marin said. "As far as I'm concerned, it does not respond to the concerns that we've heard from the public."

Those concerns have been flooding in, said Marin, who has received some 300 complaints from ticket-holders since he launched his investigation two weeks ago.

"It seems we've hit a sore spot with hundreds of ticket buyers. The calls are still coming in."

Marin also said consumers who complain directly to the corporation are being met with a "wall of silence" and some even find themselves under investigation, rather than their complaint.

"The OLG is not a freewheeling entrepreneur; there is an overarching obligation on the OLG as a Crown corporation to protect the public that it serves," Marin said. "This is certainly not an admission that they've dropped the ball or that there is any failure in the system."

The firestorm was ignited two weeks ago when a TV report suggested lottery retailers have won more prizes in recent years than mere chance would normally allow.

A disproportionate number of retailers have collected prizes of $50,000 or more since 1999, alleged the report, which cited a University of Toronto statistician who said the odds were too high to possibly be a consequence of sheer chance.

The new rules also prevent retailers from checking tickets except in cases where winners have been asked to sign the back. Those retailers who are found to be acting improperly will lose the right to sell tickets, Brown said.

The corporation is also "enhancing" its complaints and investigations process, he added.

Conservative Leader John Tory called the increased security a "series of small steps forward," but urged the governing Liberals to launch an independent investigation into the corporation.

"An additional, outside forensic audit would really make sure . . . we get to the bottom of even one customer having a lack of confidence in the lottery corporation," Tory said.

The ombudsman doesn't have the resources or know-how to conduct a forensic audit into the allegations, he added.

Wilson Lee, a spokesman for Infrastructure Renewal Minister David Caplan, said the government is satisfied with the steps taken thus far.

"They are a good first step," Lee said. "Beyond that, I think we're all waiting to see what the ombudsman's investigation is going to conclude."

Marin is expected to conclude his investigation and report back within three months.



It's a gamble that most of us have taken at one point or another:
bought a ticket at a corner store and hoped that when those little
white balls stop spinning we will be the newest lottery winner.
Most of us remain disappointed in the results. But what if you did
win the lottery? And what if you never found out?

A Fifth Estate investigation has uncovered new statistics about how
often clerks or retailers are winning. A prominent statistician talks
about the chances of this happening as often as it does.
The results may astonish you.

Watch ... "Luck of the Draw"
on the internet. A MUST see for all players.
Click here
to watch (Aired Oct 25, 2006)
(Click on "Runs 40.19" on the right side of the screen.)
You will see first hand how lotteries operate while
"claiming" they have integrity.

Read stories posted Oct 25, 2006 - click here


Other Stories

As it Appears in the San Antonio Express News
"Willy-Nilly" Lotto Prizes Spur Audit (July 2006)

About those Cheated Winners ... Click here.

Sad but True Winners Stories, Click here

There's still a chance for Lottery to lose even more credibility
by Ken Rodriguez - San Antonio Express-News
Click here to read these two stories

Integrity/Ethics Reaches New Low For Texas,
Georgia and Wisconsin Lotteries
By refusing to accept IRS Form 5754 from pool players, these states
are not only creating hardships for winners but are also failing in
their fiduciary duties in assisting with the collection of past due
child support, student loans and state owed taxes. A MUST read
if you play in group/pools. Posted 10/9/06. Click here.

Lotto Critic Efforts Pay Off
Dallas Morning News (June 11, 2005)

The Lotto Report
Dawn Nettles
P. O. Box 495033
Garland, Texas 75049-5033
(972) 686-0660
(972) 681-1048 Fax

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