Ontario Lottery and Gaming has spent the past few years trying to tackle retailers tampering with tickets, including a $12.5 million Super 7 prize from December 2003 awarded to its rightful winners last week.
But an article in the current issue of Wired magazine speculates similar scratch tickets continue to contribute to money-laundering by organized crime across North America.
Mohan Srivastava discovered in 2003 he was able to decode an instant-win Tic Tac Toe based on tickets purchased in Toronto. The geological statistician's ability to determine if a ticket was a winner, based on whether or not numbers revealed on the face of the unscratched ticket were not repeated anywhere else, was revealed three years later on an episode of CBC's "The Fifth Estate."
Science writer Jonah Lehrer dug into the story for a feature in Wired's February 2011 special issue: "The Underworld Exposed." While the article is primarily about Srivastava's findings on the 2003 tickets, he has continued to discover similar patterns to this day.
Srivastava had a difficult time bringing the problem to the lottery commission's attention. OLG only responded after he mailed in a packet of 20 unscratched Tic Tac Toe tickets, with a note explaining half were winners and half were losers, which proved correct in 19 of the cases.
Tic Tac Toe was quietly removed from Ontario retailers the following day, and Premier Dalton McGuinty claimed after subsequent revelations the system was trustworthy, due to the implementation of new stringent security measures.
But why did Srivastava rat himself out? He admitted to considering the idea of becoming a full-time instant lottery player, at least until he did the math.
"I'd have to travel from store to store and spend 45 seconds cracking each card," he explained. "I estimated that I could expect to make about $600 a day. That's not bad.
"But, to be honest, I make more as a consultant, and I find consulting to be a lot more interesting than scratch lottery tickets."
Nonetheless, he has spent the last few years investigating payouts on similar tickets sold in the U.S., printed by the same companies commissioned by the OLG.
Srivastava estimated others also figured out what he did. Wired writer Lehrer traced this activity to money-laundering activities by organized crime, based on circumstantial evidence noted by the FBI.
Srivastava was asked by Wired if he could apply statistical analysis to pick potential winners among the Instant Bingo tickets currently sold in Ontario stores. And, it turned out, he selected winners 60 per cent of the time, compared to the 30 per cent that feature at least a break-even payout.
"That might not sound very impressive, since I'm still going to buy plenty of losers," he said. "But it's still a high enough percentage that one could launder money effectively."
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