The move comes after The Virginian-Pilot’s investigation into people who claimed winning tickets at a statistically impossible rate, which led a security expert to criticize the agency’s lack of oversight.
The probes also follow several policy changes from the $2-billion-a-year state agency sparked by The Pilot’s investigation. The story, published in September, revealed that 92 people claimed at least 50 tickets worth $600 or more apiece between 2008 and 2016. The Pilot analysis also found that the state had no records of investigations into those winners and wouldnt monitor any of them unless prompted by reports of wrongdoing.
The state’s most frequent winner, from Ruther Glen, Va., claimed 207 tickets for more than $800,000, the Pilot investigation found. Another scored more than $400,000 and was luckiest at a Newport News store he owns.
Virginia Lottery spokesman John Hagerty said the lottery took an interest in 21 of the roughly 40 frequent winners that The Pilot identified to officials during its investigation. Those names have not been made public.
Of those, the lottery has finished reviewing 10 winners and has started three investigations.
“Keep in mind that opening a case should not be interpreted as meaning the individual has necessarily done anything wrong," Hagerty wrote in an email. “But it does mean we have started investigating.”
He did not say what lottery officials were scrutinizing about the winners, though he previously indicated they would review any who claimed a ticket in the past year. He did not name the three winners.
In another email sent Thursday, Hagerty stated that in "the case of two of the individuals, we did not find that they violated any lottery rules, laws or regulations." He did not provide additional details on whether the investigations were ongoing.
Bill Hertoghe, an expert on lottery security, previously said to The Pilot that Virginia’s agency could be potentially vulnerable because officials havent been regularly monitoring the winner database or running sting operations to root out possible problems among the states 5,200 retailers, whose owners are legally allowed to play games.
The lottery updated its claim form on July 31 to ask people cashing in tickets if they were a retailer or connected to one. Since then, officials have announced that they have opened 16 investigations into potentially fraudulent winners.
Now, they have issued notices of intent to revoke licenses to three retailers, Hagerty said. This, he said, is the first step in a formal process that could lead to a hearing, an official finding and a potential appeal before the Lottery Board.
One of the three cases involving retailers has been closed, he said in an email. Following a customer tip, a store owners license has been suspended for 30 days after the retailer was investigated for improperly discounting tickets, Hagerty said. The lotterys actions against the other two retailers are still pending.
At the lottery’s last public board meeting in October, Director Kevin Hallsaid the agency had made three policy changes to prevent fraud among retailers. In the information it sends to sellers each month, it now includes prominent reminders of rules and regulations. Officials are also consulting with other state lotteries to determine best practices related to repeat winners and security.
The most significant change, though, is that the lottery will now regularly monitor its database to follow up on frequent winners.
"Going forward, this will identify repeat winners and help us determine if circumstances warrant further investigation," Hall said at that meeting.
The agency’s IT and security departments are still working on a program that would analyze its database to identify those frequently claiming tickets.
Currently, Hagerty said, officials are manually monitoring claims data.