[1] http://www.forbes.com/sites/kiriblakeley/2011/07/21/meet-the...
[1] http://www.forbes.com/sites/kiriblakeley/2011/07/21/meet-the...
Though the actual scheme was hatched by Charles Marie de la Condamine, rather than Voltaire. But Voltaire is the one who got the most fame (and possibly money) out of it.
It was a quote from 'The Friends of Voltaire', and misrepresented him.
The Philadelphia Inquirer figured it out:
http://www.philly.com/philly/news/nation_world/Lotterys_luck...
TL;DR scratch tickets aren't random, rather they are intentionally spaced out. The Texas lottery releases spacing info to the public. Once you have a regular lottery annuity (the first one was luck) you can spend vast sums on lottery tickets and write off your losses, so the public subsidizes your lottery purchases.
One particular gem: they said that a game returning 66.9% of the money spent on it has a "remarkable" return - that's a loss of 33.1 cents on every dollar and would quickly render anyone playing it without a mathematical advantage bankrupt. They also suggested that such a return reduced variance in the game, apparently not understanding that this return includes the top, multi-million dollar prizes. They confused hit frequency with the return of the game.
The tax incentive thing is also ridiculous. While it is true that one may deduct their losses up to the amount of their taxable winnings, if she were playing without an advantage, she would still lose and this offered no help on beating odds of 1 in 18 septillion.
Finally, they could have handed her tickets for free all day and she should have only hit what she did every quadrillion years. There are literally not enough raw materials available on our planet to produce the 18 septillion tickets that should have been necessary to hit what she did - even if mankind devoted all of its resources to the project.
The best speculative theory is that she was able to deduce an approximation of the algorithm used to distribute the tickets, but again that is only speculation. She clearly figured something out; to say that this article nailed it, however, is a serious misstatement.
This is a dubious statement, but if you believe it, don't you think it calls into question some of the "odds" that have been bandied about with no support?
This particular situation reminds me of that of racehorse owners. Most owners will lose money in racing in any particular year. They hope to make enough in good years to break even over time. If there's never a good year, the IRS might eventually drop the "hobby" ax.
This is probably the biggest problem with the steady defunding of the IRS. They can still catch shameless cheaters like the morons who don't send in their employees' payroll deductions, in no small part because no CPA will touch that shit. CPAs are usually willing to discuss write-offs, however. The expansion of the set of acceptable write-offs is inherent to any income tax system, and since it has been left unchecked it has undermined the system we have.
http://www.foxnews.com/scitech/2011/08/01/elderly-couple-che...
That article also gave more information on the lottery's stance on the matter:
But Paul Sternburg, the lottery’s executive director, believes they have no reason to apologize or even change the lottery's procedures -- pointing to $11.8 million in profits in 2011.
"It’s a niche game for a different audience," he told the Boston Globe. "You want to bring in as many players as possible. Some people chase a huge jackpot. Others are looking at odds."
Of course, not everybody can exploit the loophole, only people with at least $100k to invest in the endeavor. So this means that the government is giving an unfair advantage, in a game that is supposed to be random chance, to the wealthy. As soon as those who can't take advantage of the lottery figure this out, they stop playing. This means the loophole stops being effective and the rich drop out too.
The Boston Globe article implies that the MIT syndicates bought so many tickets they actually affected the distribution of the prizes in their favour http://www.boston.com/news/local/massachusetts/articles/2012...
Not to mention that having even just $1000 of free cash to "invest" in a positive sum gamble already puts you in a higher income/wealth bracket than most lotteries' most loyal players.
Anyone who knew there was a way to garner the profits from the lottery, but didn't know the way, would be a fool to play.
Nope, not at all. These people are playing by the rules. The lottery officials are aware of their play; and yet don't consider it illegal. There is nothing wrong with using your superior skillset legally to make some money.
As long as people think they can get rich quick, it's a good design.
If the game has a bug that only a few players know about, it isn't fair, by definition.
Consider, for example, one of those "how many marbles are in this jar?" games. If I use my knowledge of math and physics to derive a pretty accurate estimate, it's not wrong, is it?
One lottery would ship the winning tickets roll to one zipcode. Apparntly, they printed out the winning tickets and just queued it up via whatever delivery service they use, which turned out to be deterministic. No one ever coded in randomness in regards to store delivery. Someone figured this out by noticing the same few stores produced all the winners. He then went and bought a whole bunch of tickets from those stores when a new scratch-off game appeared and won against significant odds.
Or at least that's the story he presents, which is questionable as scratch winners aren't usually publicly reported. Some think he had inside information from a friend or relative in the Lottery commission who told him about that lack of randomness in delivery.
Just like we where prohibited from gambling on the online gambling site i worked for a couple of years ago.
They told me that employees were allowed to purchase tickets. The theory was, if employees can't be trusted to buy tickets, there must be a flaw in the system. And if there's a flaw in the system, then it will be exploited whether you prohibit employees form directly purchasing tickets or not.
That obviously does not map directly to the employees of companies that print scratch-and-win tickets, of course.
[0] http://harpers.org/archive/2011/08/the-luckiest-woman-on-ear...
http://www.philly.com/philly/news/nation_world/Lotterys_luck...