Wisconsin officials file charges in lottery fixing scheme

AP News
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Posted: Dec 22, 2016 7:30 PM

DES MOINES, Iowa (AP) — A former lottery computer administrator from Iowa and a friend from Texas were charged Thursday in Wisconsin with racketeering and theft by fraud for allegedly rigging a 2007 Megabucks game which paid them more than $780,000.

Eddie Tipton, who lived in Iowa and is now listed in court records as having an address in Flatonia, Texas, was charged by the state attorney general's office along with Robert Rhodes of Sugar Land, Texas. Tipton also faces four counts of computer crime. All are felonies.

The documents allege Tipton, who worked for the Urbandale, Iowa-based Multi-State Lottery Association, modified computer data so he could pick a winning number for the Dec. 29, 2007, Wisconsin Megabucks game. Tipton's job was to write software designed to randomly pick numbers for lottery computers used for various games by 37 state and territorial lotteries.

A state investigator says Rhodes confessed the scheme, explaining that Tipton recruited him to help win jackpots and gave him a series of numbers to play, one of which won the $783,257 jackpot that Rhodes collected and later split with Tipton.

The Wisconsin criminal complaint said Rhodes told a state investigator that in December 2007 he visited Tipton in Iowa and Tipton provided him with index cards with a series of numbers written on them, telling him that one of the numbers would win.

Rhodes said he rented a car, drove to Wisconsin and purchased tickets from various stores around southwest Wisconsin. He said after driving back to Iowa, he flew home to Texas.

Rhodes told the investigator that Tipton explained how a file he created in the computers could be activated at will.

He said Tipton wanted him to play again in December 2010. Rhodes said he did but had second thoughts and feared being caught, so he only played some of the numbers Tipton gave him. He later realized that one of the numbers he didn't play would have won another Megabucks jackpot.

He said in early 2011 Tipton visited him in Texas and showed him an Iowa Hot Lotto ticket that had hit the $16.5 million jackpot. Tipton told him he was thinking of having his brother, Tommy Tipton, cash it for him but he was concerned that Tommy had already won a 2005 Colorado jackpot. Although Rhodes attempted to get the ticket cashed through people he knew, he wasn't successful because Iowa Lottery officials grew suspicious.

Tipton, 53, plans to voluntarily appear to face the charges in mid-February "and looks forward to defending himself in court," said his attorney, Dean Stowers.

Rhodes' attorney did not immediately return a call seeking comment.

Rhodes and Tipton have known each other since the early 1990s when they were in business together in Texas.

Iowa trials are scheduled early next year for Tipton and his 52-year-old brother, Tommy, a former deputy sheriff and justice of the peace in Texas. They'll be tried separately on a charge of ongoing criminal conduct. Eddie Tipton, who was previously convicted of a separate lottery fraud, faces an additional charge of money laundering in Iowa.

Tommy Tipton's trial is scheduled for Jan. 23 and Eddie Tipton's is set for Feb. 13.

Rhodes, 48, is scheduled to enter into a plea agreement with Iowa prosecutors next month and is expected to testify at the Tiptons' Iowa trials.

Eddie Tipton was fired by the Multi-State Lottery Association after he was initially charged with fraud in January 2015 related to the 2010 Iowa Hot Lotto ticket. He was convicted last year on two counts of fraud but one was thrown out by a state appeals court in July.

Iowa prosecutor Rob Sand alleges the conspiracy involving the three men netted more than $2 million in winnings from two 2005 Colorado lottery tickets, the 2007 Wisconsin MegaBucks ticket, two 2010 Kansas 2by2 tickets and a 2011 Oklahoma Hot Lotto ticket.

Tommy Tipton won the two lottery prizes in Colorado and one in Oklahoma. He convinced friends to cash the tickets for him to remain anonymous.

Mark Weinhardt, attorney for Tommy Tipton, filed a motion to dismiss the ongoing criminal conduct charge against him in October, saying the state cannot prove he committed a crime.