AUSTIN, Texas – Texas Attorney General Ken Paxton is the latest to open an investigation into the Texas lottery after a controversial win drew the attention of state lawmakers.
What they’re saying:
In a release, Paxton said he was looking into two “suspicious and possibly unlawful” lottery prizes that were purchased through a third-party courier service.
“I’m deeply concerned about the integrity of our state’s lottery system, especially when it appears that non-citizens have shown that they are attempting to rig the system to win on demand,” Paxton said. “Texas citizens deserve far better than bad actors getting rich off of a lottery system that is open to exploitation, and we will hold anyone who engages in illegal activity accountable.”
The investigation will look to find any state or federal laws that might have been broken and how the winners were able to get many tickets in a short period of time, Paxton said.
The backstory:
The latest controversial win came on Feb. 17, when an $83.5 million winning ticket was sold at the Winners Corner TX LLC store in North Austin.
The win was the fifth-largest in Texas lottery history.
Lt. Gov. Dan Patrick’s Investigation
The winning ticket was purchased through an app called JackPocket, which also owns Winners Corner.
The win caused Lt. Gov. Dan Patrick to visit the store.
The winning ticket was purchased through an app called JackPocket, which also owns Winners Corner.
Patrick visited the store on Feb. 18 and posted a video on social media of his visit. His video shows a couple of terminals to buy lottery tickets and merchandise tables with board games for sale. Patrick said behind the public part of the store he saw dozens more ticket terminals printing lottery tickets.
DraftKings, the parent company of JackPocket, argues they aren’t breaking any laws and that this win was not as a result of a bulk ordering system, where millions of dollars are spent buying nearly all possible number combinations.
What they’re saying:
Patrick said while a courier service like JackPocket is not illegal, it was not the intent of the state lottery when it began in 1991.
“Do you not see an issue where the public might lose confidence if the courier service somehow happened at this one location in the entire state of Texas sold an $83 million winning ticket, and they also own the location that printed the ticket?” Patrick asked a store employee at Winners Corner.
On Monday, Jackpocket announced it would suspend its courier service.
The move came hours after the Texas Lottery said it was moving to ban courier services.
Texas Lottery Commission Executive Director Ryan Mindell issued a new policy statement on Monday saying the agency is taking action to stop couriers from operating in Texas.
“Unregulated courier operations provide opportunities for other illegal and fraudulent activities to flourish, including money laundering, the sale of fictitious tickets, and false representations of a courier’s association with the TLC. If couriers are allowed to continue to operate, these critical safeguards will continue to be circumvented and the public will be harmed,” wrote Mindell in the statement.
It’s not the first time a lottery win has been under fire.
Gov. Greg Abbott has directed the Texas Rangers to not only investigate the Austin win, but also investigate a 2023 win in Colleyville.
April 22, 2023 – $95M ticket sold in Colleyville
The backstory:
Bulk purchasing was responsible for a $95 million win in Colleyville on April 22, 2023.
The ticket was sold at Lottery Now in Colleyville, which sold nearly every possible combination of numbers to a group of investors.
What they’re saying:
Eric Dexheimer, an investigative reporter from the Houston Chronicle, said the lottery purchase was planned in the country of Malta and purchased by a betting company in London that legally does syndicate buys.
The winner ticket was sold to Rook Tx LP, which is an LLC incorporated in Delaware, but the actual people behind the win have not been identified.
The win has led many to question the lottery commission and the integrity of the game.
“The idea that someone could come in and buy a jackpot, which really comes at the cost of your ordinary lottery player,” Dexheimer said. “If there’s a $95 million jackpot and someone has already guaranteed that they would win it, then you and I and the rest of regular lottery players are basically playing for second place. The fact that it could happen, it think, has shaken a lot of people’s faith in the system.”
The lottery commission said the purchase did not violate any laws or lottery rules.
A lawsuit has since been filed against the Texas Lottery Commission.
Former executive director of the Lottery Commission Gary Grief and a courier are being accused of money laundering, fraud, and manipulating the outcome of lottery games. However, they denied their involvement.
The current lawsuit has sparked skepticism among people who are following the number of lucky tickets that are bought at these courier lotto stores.
Texas Legislature
What’s next:
Several bills have been filed in the 89th legislative session to amend the current lottery rules. Patrick supported legislation to ban couriers in the last session, but it failed to pass the Texas House.
The bill, SB 28, passed unanimously out of the Senate State Affairs committee Monday. A date for debate in the full chamber has not been set.
The Texas Lottery Commission is also currently under review by the Texas Sunset Advisory Commission, which regularly assesses the need for state agencies or programs to exist. Each agency or program has a “sunset date”, which also serves as a deadline for the Legislature to pass a bill to continue it.
Typically, agencies are renewed on a 12-year basis. The Texas Lottery Commission was last under review during the 83rd legislative session in 2013.
Patrick said it could be the end of the lottery if the bill to ban courier services does not pass.
The Source: Information in this story comes from an interview with the Houston Chronicle’s Eric Dexheimer, who was the first to report on the controversies surrounding the lottery. Information on Ken Paxton’s investigation comes from a release by the Office of the Attorney General. Background information was pulled from previous Fox coverage and Dan Patrick’s X account.
