After increasing from $450 million on Saturday to $700 million on Thursday, the Powerball jackpot has surpassed every other lottery game’s jackpot in U.S. history by reaching $800 million for Saturday’s drawing.
It’s been almost four months to the day since the former information security director of the Iowa-based Multi-State Lottery Association (MUSL) was sentenced to 10 years in prison for rigging a Hot Lotto drawing. On September 9, fifty-two year-old Eddie Ray Tipton of Norwalk, Iowa was convicted of two counts of fraud in what is believed to be the first case in history of a defendant being tried for altering a lottery computer to manipulate the outcome. Tipton’s position with the MUSL prohibited him from playing the lottery, but proved to be an insufficient deterrent. At trial, Tipton was accused of using a “rootkit,” a self-deleting computer program, to manipulate the draw in an effort to win $14.3 million.
Random-number generators from the MUSL, which distributes prizes and administers games to the lottery consortium, are used in thirty-seven states and U.S territories. So far, Tipton and his associates, including his brother Tommy Tipton, who is a judge in Texas, and Texas businessman Robert Rhodes, are allegedly linked to $8 million in jackpots paid out in Colorado, Wisconsin, Oklahoma and Kansas, according to the Associated Press.
The lottery scandal, the first of its kind, begs the question – if an individual is willing to chance going to prison for 10 years for $14.3 million, what limits would be tested for $800 million? The World Casino News spoke with Daniel Russell who is Special Counsel at Jones Walker LLP in Tallahassee, Florida. Russel represents major casino companies, suppliers, and manufacturers, covering the financing, development, licensing, and operation of gaming and resort facilities. He has served as Gulfstream Park’s General Counsel in Florida and most recently General Counsel of the Florida Lottery, a $5.5 billion per year operation. Russell believes that third-party audits need to be implemented to help prevent incidences of fraudulent activities, such as the MUSL’s massive security breech, rather than the current system of self-regulation. So, while states are celebrating Powerball’s massive jackpot, they are also most likely questioning the integrity and security of the games they are selling to the public.
Saturday’s jackpot translates to a cash option of $496 million – before taxes – or the entire $800 million to be paid out over approximately 30 years. Choose the latter option and you’ll get a small piece of the $496 million pie upfront. The rest is invested by Powerball with the accrued interest used to pay out the growing installments over the next 30 years. The bottom line is – opt for the lump sum to maximize your winnings overall value. It could net you, after taxes, more than the $800 million over 30 years if invested in something like tax free municipal bonds, according to CNN Money. The current Powerball jackpot has been growing since early November when someone matched all six Powerballs. Ticket holders have a 1 in 292.2 million chance of winning.
The only way to win is to play. Buy tickets online.