Lottery retailers cashing in others’ tickets: Lottery knew, did little

The Florida Lottery has known for years that some of its retailers were illegally cashing in tickets and in some instances, lying about it, but its top brass did little or nothing to stop it, a review of internal lottery records reveals.

Since at least 2009, the agency’s investigators have caught at least 10 store clerks and owners illegally cashing in tickets for customers.

But when it came time to mete out punishment, the agency issued 30-day suspensions of lottery sales or did nothing at all.

That didn’t change until March, when The Palm Beach Post revealed that millions in lottery winnings had been paid out to people, including store clerks and owners, who might have been coming by the winning tickets illegally.

The lottery is now cracking down on crooked clerks. They’ve stopped sales at more than 30 stores in the state this year.

Two of the lottery’s most prolific winners identified by The Post, a Gainesville couple who own a convenience store, were investigated by the lottery in 2009 for trying to cash a ticket that was deemed suspicious, the records show.

The lottery did nothing then. They revoked the couple’s license this year after The Post’s story.

Through lottery records, The Post found nine other examples since 2009 in which investigators believed a store owner had caught the owner cashing in a ticket for someone and sometimes lied to the investigator about it. Cashing in a ticket for someone else is a first-degree misdemeanor.

In six of those cases, the lottery did nothing or issued a warning. In three cases, they issued 30-day suspensions.

In one case, they terminated the contract with the store — but only after The Post recently asked for the case file two years after it was closed.

In that case, in December 2011, lottery investigator F.R. Springer looked into a $1,000 ticket submitted by Suryakant Mistry, who owns three stores between Tampa and Orlando. He had won 35 big prizes worth $52,000 before then.

The area for the winner’s signature on the back of the ticket had been covered with whiteout, and Mistry said his wife’s name was underneath, according to Springer’s report. Winning lottery tickets are supposed to be signed by the winner to prevent fraud.

In fact, someone else’s name was underneath. Mistry lied to Springer, but eventually admitted that he had bought the $1,000 ticket from a customer for $700, taking a $300 fee, the report said.

Springer contacted Mistry’s lawyer to resolve the case “without pursuing criminal charges,” but Mistry rejected the offer to voluntarily give up his lottery license, the report states.

Springer recommended Mistry and his wife never be allowed to sell lottery tickets again and sent his findings to his bosses in 2012.

But lottery officials took no action at all — until The Post asked about it. Mistry lost his contract last month.

Escaping child support

Most of the examples The Post found followed a similar investigative pattern, like the case of a Fort Pierce store owner last year.

Sanjaykumar Patel submitted a $5,000 winning scratch-off ticket, but on the back, he had scratched out someone else’s name and written his wife’s name, according to the lottery’s investigative report.

That automatically triggered the investigation.

Patel told investigators he originally wrote his daughter’s name, Jhavani, on the ticket, then decided to have his wife cash it. That seemed like an innocent mistake, until a lottery examiner used sophisticated equipment to uncover the actual name that had been scratched out: Grady.

The lottery investigator, knowing he had been lied to, tracked down a Grady Roberts, who admitted selling the ticket to Patel for $4,000, a $1,000 loss.

Customers occasionally choose to sell their lottery tickets to avoid paying taxes, child support or other debts on the winnings, even though the act is a misdemeanor. Before making payouts on winners of $600 or more, the lottery withholds such debts.

Roberts said he sold the ticket at a loss because he owed Patel money. But the lottery found he also owed child support, the report states.

Patel eventually admitted to buying the ticket from Roberts, and the lottery suspended ticket sales at his store for 30 days.

Patel, whose wife has won the lottery 36 times for $74,000 since 2005, still sells lottery tickets.

Frustrated investigators

In some cases, the lottery’s investigators, who are sworn police officers, seemed frustrated by the lack of action by their bosses.

In 2011, investigator Don Mardis caught a store owner near New Port Richey trying to cash a $1,000 ticket he bought from a customer for $775.

The owner, Pinal Patel, lied to the lottery about it in a sworn statement, Mardis wrote. Then when Mardis tried to explain the consequences to Patel, Patel hung up on him.

In his report, Mardis spelled out how Patel’s actions violated three lottery rules — jeopardizing the integrity or security of the lottery, charging a fee to redeem a ticket and paying a prize worth $600 or more.

“Patel knew the information he gave a sworn statement to was untruthful,” Mardis wrote in his report. “Each of these offenses listed is an offense punishable by suspension of contract. However, because the retailer purposely gave a false sworn statement to hide his actions is grounds to request termination of contract (sic).”

Mardis’ bosses disagreed.

When given the option between a 30-day suspension or termination, all of them — Director of Security Doug Pitts, Director of Sales Tom Delacenserie, Chief of Staff Bruce Hoffmann and an unidentified lottery lawyer — chose the 30-day suspension.

It’s unclear whether Lottery Secretary Cynthia O’Connell agreed. She dated, but didn’t sign, the suspension form, and didn’t respond to questions about the form.

Lottery changes

The issues predated O’Connell’s tenure as secretary. She’s a Rick Scott appointee, serving since 2011.

In 2009, one of the winners identified by The Post, Gainesville store owner Amit Thakker, tried to redeem a $1,000 ticket. But he crossed out someone else’s name on the back of the ticket to write his own, according to the lottery’s report.

The ticket was just one of many winners for Thakker. He and his wife have won 214 big prizes worth $531,000, making them the most prolific winning couple in the state.

After the lottery flagged the ticket, he told investigators he had crossed out his wife’s name, but evidence showed he had written over someone else’s. The lottery investigator, feeling he’d been lied to, recommended Thakker not be paid. The lottery did nothing.

This year, the lottery looked deeper into his wins, found evidence he was cashing in tickets for people and revoked his store’s lottery license.

O’Connell declined to be interviewed for this story, but a spokeswoman, in a statement, said the lottery has made a number of changes to improve security this year, including “personnel changes” in its division of security.

“The lottery will continue to proactively address issues like these if and when they arise,” the spokeswoman wrote.

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