Group Invests $5 Million To Hedge Bets in Lottery

Post on: 16 Март, 2015 No Comment

Group Invests $5 Million To Hedge Bets in Lottery
Published: February 25, 1992

RICHMOND, Feb. 24 There is a dream common among regular lottery players: to wait until the jackpot reaches an astronomical sum and then to buy every possible number, guaranteeing a winner.

Sure, it would cost millions of dollars. But the payoff would be much richer.

In Virginia this month, one investment group came tantalizingly close to cornering the market on all possible combinations of six numbers from 1 to 44. State lottery officials say that the group bought tickets for 5 million of a possible 7 million combinations, at $1 each, in a lottery with a $27 million jackpot. Only a lack of time prevented the group from buying tickets for the remaining 2 million combinations.

While no one has come forward with the one winning ticket in the Feb. 15 lottery, several clues point to the investment group, an Australian syndicate, as the winner. If that is so, the numbers 8, 11, 13, 15, 19 and 20 will yield a prize of $1.3 million a year for 20 years to the group.

Banking officials here say the money for the bulk purchase of Feb. 15 lottery tickets came from Australia. An Australian regulatory official also said a syndicate there had notified its investors that it had won an overseas jackpot. The winner has six months to claim the prize.

Virginia officials are worried enough about a repeat performance that they met today to debate a proposal that would block bulk sales of lottery tickets.

The governing board of the Virginia lottery held a public hearing today and received some criticism. Hans Smetona, a 22-year-old pizza deliveryman here, said, No one wants to be in line behind anyone who’s there for three or four days.

After the hearing, the lottery board adopted a recommendation to Gov. L. Douglas Wilder that sales agents be required to take orders from people in line before filling orders from absentee buyers. As a reason for the recommendation, officials cited the example of a store that put an out-of-order sign on its lottery terminal as an employee printed hundreds of tickets for the investors in the Feb. 15 lottery.

Executives of two retail chains that sold tickets in the Feb. 15 lottery to bulk purchasers said representatives of the investment group had visited them in the fall to discuss the logistics of a large lottery purchase. A. C. Miller, president of the Miller Oil Company, which owns one retail chain that sold $600,000 in tickets, the Miller Mart convenience stores, identified one representative as Anithalee Alex Jr. of Teutopolis, Ill.

Mr. Alex’s telephone number there is unlisted. Art L. Kinkelaar, the Sheriff of Effingham C ounty, which includes Teutopolis, said he had no information about Mr. Alex, but added that the day before the drawing he received an inquiry about Mr. Alex’s background from Virginia officials.

The bulk sales of lottery tickets began after Feb. 12 when the Virginia jackpot appeared headed for a record level. The state lottery director said agency computers showed a huge increase in sales beginning the next morning.

The players had until 11:15 P.M. on Feb. 15, five minutes before the drawing, to buy tickets. The lottery director said at least one store was still selling tickets at a brisk pace, 2,400 an hour, at the last minute. Even so, the group seems to have been caught without slips for two million possible combinations. 1 Ticket in 5 Million

For someone to try to do this ticket-by-ticket is a very chancy proposition, said Michael E. Julian, chairman of Farm Fresh supermarkets, the second retailer, which got a $3 million order. That’s what lotto’s all about.

The lucky ticket, which sold for $1 and is worth $27 million, was issued at a Farm Fresh that sold part of the huge batch bought from the chain.

Watching them try to find the one winning ticket would be quite a sight, said Kenneth W. Thorson, the state lottery director.

In Virginia’s six-number lottery, players pick six numbers from 1 to 44. The winning combination is determined by a machine.

Lottery officials speculate that the investors may have chosen Virginia for two reasons. The state had the biggest jackpot in the country that weekend. And the seven million entries required to cover all the combinations in a 44-number lottery is just half the number needed in a 49-number lottery, like Florida’s. California has 51 numbers and New York has 54. Improving the Odds

William S. Bergman, executive director of the North American Association of State and Provincial Lotteries, said that 24 of the nation’s 34 six-number lotteries have longer odds than those for Virginia’s game.

In the Virginia game, there are 7,059,052 possible combinations of numbers. So someone who buys one ticket has odds of 1 in slightly more than 7 million. Having more tickets increases the odds of winning, so that 1 million tickets have odds of 1 in 7. Since each ticket costs $1 it would cost $7,059,052 to cover every combination. Anyone who did that would receive at least a share in the jackpot and many of the second, third and fourth place prizes, that together were worth more than $900,000 on Feb. 15.

Here your chance to leave a comment!