Jackpot-fixing investigation expands to more state lotteries

apnews.myway.com The allegations read like a movie plot: a lottery industry insider installs an undetectable software program in the computers that pick winning numbers so he can know them in advance. He enlists accomplices to play those numbers and collect the jackpots. And they enrich themselves for years until a misstep unravels their high-tech scheme. Eddie Tipton, former security director of the Multi-State Lottery Association, has been accused of tampering with drawings in four states over a six-year period, and investigators are now expanding the inquiry nationwide to determine if the number could be larger. State lotteries in Colorado, Wisconsin, and Oklahoma have confirmed they paid jackpots worth $8 million to Tipton associates, including his old college roommate, Robert Rhodes. Investigators are looking at payouts in the other 37 states and U.S. territories that used random-number generators from the Iowa-based association, which administers games and distributes prizes for the lottery consortium. The inquiry is sending a chill through state governments that receive $20 billion annually in lottery revenue, and that depend on public confidence in the contests. Tipton installed software or had access to machines for national games such as Hot Lotto and some state-based games. The most lucrative ones, Powerball and scratch tickets, weren't part of the scheme, according to lottery officials. "It would be pretty naive to believe they are the only four" jackpots involved, said now-retired Iowa deputy attorney general Thomas H. Miller, who oversaw the investigation for 2 ½ years. "If you find one cockroach, you have to assume there are 100 more you haven't found." Tipton, 52, was convicted in July of fraud in the attempt to claim a $16.5 million jackpot in Iowa. He was sentenced to 10 years but is free pending appeal. He is also charged with ongoing criminal conduct and money laundering involving the other three state lotteries. Rhodes, a businessman from Sugar Land, Texas, is charged with fraud in connection with the Iowa jackpot, and is under investigation in Wisconsin. Tommy Tipton, Eddie's brother, who bought a winning Colorado Lotto ticket in 2005, resigned his position last month as a justice of the peace in Flatonia, Texas, 100 miles west of Houston, but hasn't been charged. Colorado authorities are investigating. Eddie Tipton's attorney, Dean Stowers, says his client is innocent. "There's just absolutely no evidence whatsoever that he did anything to alter the proper operations of the computers that were used to pick those numbers, absolutely no evidence. It's just all speculation," Stowers said.