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Massachusetts Lottery Is Cracking Down On Fraudulent Ticket Cashers

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There are a small group of people who seem to have the lottery figured out. Some people are cashing 20 or more winning tickets in a year, and banking over $20,000. This is something the lottery keeps track of and calls the 20/20 list, which it sends to law enforcement and tax collectors.

There are three explanations for landing on this list:

  • These players are buying a lot of lottery tickets
  • They’re on the right side of variance
  • They’re cashing winning tickets for the real winners.

The final explanation is the most likely, and the Massachusetts Lottery is starting to take steps to crack down on ticket cashers.

From here on out, cashing in more than your fair share of winning tickets will not only land you on the Lottery’s radar and the 20/20 list, it may prevent you from claiming future prizes.

The MA Lottery’s new policy

A new policy detailed by Lottery Executive Director Michael Sweeney on Wednesday places a soft-cap on the number of significant winning tickets a person can claim.

The new policy takes effect on Oct. 1. According to Statehouse News Service (paywall):

“If an individual claims six or more Lottery prizes of $1,000 or more during the course of any consecutive 12-month period, the Lottery executive director will have the authority to suspend that individual’s ability to claim additional prizes for a certain period of time.”

Players are able to appeal the decision.

“We are going to be more proactive in this area … to make sure things are on the up and up,” Sweeney said. “This is the Lottery increasing our due diligence in protecting the games and the consumers.”

Ticket cashing 101

Ticket cashing for someone else seems like a win-win in most situations, but it’s highly illegal.

Some lottery winners who want to avoid taxes may offer a low-income acquaintance a percentage of the winnings if they cash the ticket for them. So, instead of getting whacked at 39 percent at the end of the year, they might pay someone 5 or 10 percent of the prize to cash the ticket for them. That person may not have to pay any taxes on the winnings, depending on their income.

Other winners may pay a ticket casher substantially more, and this is where the practice becomes disturbing.

Undocumented residents and anyone with outstanding warrants, child support payments, or taxes are just some of the people may not want to show up at lottery headquarters to claim a substantial prize. They may pay through the teeth to avoid doing so, as it’s the difference between collecting something or nothing.

Ticket scams a bigger problem than you might think

Ticket cashing is nothing new, but just how big a deal is it?

Bigger than you might think.

It’s not just a few people doing their friends and family a solid a few times a year.

According to Statehouse News Service, people aren’t simply cashing in 20 tickets in a year, some people are cashing in 20 or more tickets a week:

“A version of the 20/20 list provided by the Lottery includes players who have cashed, on average, as many as four $1,000 Lottery prizes every day so far in 2017. Among them is Ali Jaafar of Watertown, who so far in 2017 has claimed 936 prizes from the Mass. Lottery — an average of more than four wins per day — totaling $1,322,482.50. On July 31 alone, the Lottery records show, Jaafar claimed 18 prizes — 15 from instant tickets and three from Keno — worth just under $20,000.”

The article also notes another person on the Lottery’s list has claimed 609 prizes of $1,000 or more in 2017.

As Sweeney noted, the amount of winning tickets some people are claiming “strain credulity.” And that is putting it mildly.

According to Statehouse News, the odds of winning $1,000 on one of the lottery’s new $10 tickets is 1-in-2,087.

That means a person would need to buy, on average, 2,087 $10 tickets (at a cost of $20,870) to win a single prize of $1,000. To be clear, that’s not their return, as they will win plenty of smaller prizes too.

A player cashing in 936 tickets from January 1 – July 31, like Jaafar, would require them to purchase about 2 million tickets. That works out to over 9,000 tickets per day, scratching them at a clip of 6.4 tickets every minute, 24 hours a day, non-stop.

This wouldn’t be an issue online

Massachusetts is toying with the idea of allowing online lottery sales, and ticket cashing is one of the many issues the lottery faces that wouldn’t be an issue online.

Because each player has to register an account, every winning ticket can be traced to the person who purchased it. Unlike an anonymous ticket purchased at a brick and mortar lottery retailer, when you show up at Lottery headquarters to claim a prize you won online, they already know who you are.

Steve Ruddock

About

Steve Ruddock is a veteran of the poker media, contributing to offline and online publications centered on the regulated US online gambling industry. These include OnlinePokerReport.com, PlayNJ.com, USPoker.com as well as USA Today. Steve is based in Massachusetts and is also a poker player.