Monday, August 31, 2015

Illinois Lottery Winners Are Not Lucky by Frank Fontaine

As a former resident of the Chicago burbs, I still keep up with Illinois politics and news.  The lastest horror story revolving around fraud and corruption is the Illinois Lottery.  Illinois and all states for that matter who sell lottery tickets rely on sales.  It's an easy source of revenue.

Illinois resident Danny Chasteen won 250K on a scratch-off ticket.  He was told that he would receive his winnings in four weeks.  Five weeks later Illinois Lotto called to tell Danny that they could not send the money until state budget issues were settled.  Apparently he is not alone in having the wind taken out of his sails.  The state comptroller cannot issue checks over 25K until the "resolution."  Big winners are given an indefinite IOU.
So how much does the state of Illinois make off of lottery sales?  Experts believe on average that states set aside sixty percent of lottery income for prize money, twelve percent for administration fee and advertising, and keep the rest for ..... education?  That's been a claim for years, a claim without proof.  No one seems to know where the lotto revenue goes.  The public schools may not reaping the rewards.
In 2013 the Illinois Lottery sold 2.9 billion dollars in tickets.  After prize money, expenses, and a Capital Projects Fund (not sure what that is-something to do with soil and erosion), there was 656 million dollars left designated for the school fund.  Much of that money does go to schools, but it's a tiny percent of what the schools require to stay open.
What will happen to the Illinois Lottery?  I believe it's fraudulent to sell tickets without any prize money in reserves.  The Illinois Lotto should be closed down until they can guarantee prizes.  This would be illegal with any other kind of business.  What next?  Will bonds be honored?  What about state financial institutions?  Sounds like an episode of American Greed.  Leave a comment and don't buy a lotto ticket in Illinois-it might be your unlucky day!

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