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Connecticut Lottery Failed to Report 5 Card Cash Fraud Concerns: Report

Published May 2, 2017 • Updated on May 2, 2017 at 1:37 pm

Connecticut lottery officials were aware of the potential for cheating with the 5 Card Cash game before the game was even instituted, but did nothing, according to a new report provided by the Department of Consumer Protection.

Tickets for the Connecticut lottery’s 5 Card Cash Game haven’t been sold since an investigation into fraud concerns began in 2015. The state learned from retailers that there were concerns over cheating in the cash poker-style game that allowed people to manipulate the tickets to win.

On Tuesday, lawmakers revisited the issue in a public hearing at an information hearing. The Public Safety and Security Committee invited the public to discuss the investigation into the game as well as the severance package awarded to the former Connecticut lottery CEO Anne Noble.

Investigations

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According to the new investigation report, Connecticut Lottery Corporation officials were warned of concerns from other state lotteries about the potential for fraud with games set up in the same style as 5 Card Cash, but did not pass that information along to DCP’s Gaming Division.

During testing before the game’s launch, lottery officials discovered bet details could be seen by retailers on customer history screens, and the lottery took steps to monitor retailer activity as a result. However, this information was not passed along to DCP.

The DCP report states that as early as July or August of 2014 the lottery knew there were issues with bet details because of the information provided on the customer history screens, but no action was taken.

Eventually retailers found there was a way to essentially find out of a bet was a winner, then slow down the system and avoid losing tickets.

Despite lottery officials knowing about potential problems over a year before, the first report to DCP that there may be an issue with 5 Card Cash until October 29, 2015. That November the game was temporarily suspended and the lottery said it had plans to install new software to enhance security and eliminate the problem.

Multiple lottery merchants were arrested on cheating accusations, and lottery officials estimated some retailers earned tens of thousands of dollars through the fraud. Some of the money was recovered.

Iinvestigation led to a permanent suspension of the game. The state concluded that some lottery officials were in violation of reporting requirements and that there was cause to question the “suitability” of certain lottery employees.

Anne Noble, who was one of the officials under investigation, announced her resignation in August 2016 and officially surrender her license and stepped down in September. However, she stayed on as a paid adviser to the lottery board for several more months.

“DCP takes the investigation into the 5 Card Cash game incredibly seriously,” said Consumer Protection Commissioner Michelle H. Seagull in a statement. “We remain ready, willing, and able to provide the information we can to the legislature and the public. Our investigation is coming to a close and we will provide further information upon its completion. I want to thank our gaming division for working so diligently on this matter, and the public for their patience as we work to finish our investigation as thoroughly as possible.”

Connecticut lottery officials were aware of the potential for cheating with the 5 Card Cash game before the game was even instituted, but did nothing, according…

Suspended Lottery Game Had Too Many Winners

The Connecticut Lottery and state Department of Consumer Protection shut down the 5 Card Cash game after noticing there were more winners than the game’s parameters should have allowed, and determining that some lottery agents were manipulating machines to print more winning tickets and fewer losers.

The investigation is ongoing, Consumer Protection Commissioner Jonathan Harris said Friday afternoon, but lottery retailers found to have cheated could face criminal charges.

“Loss of license is just the beginning,” Harris said. “They could go to jail for this.”

The Connecticut Lottery and its contractor are working on a software update to eliminate the problem. Sales of the popular lottery game could resume next week. People who hold winning 5 Card Cash tickets cannot cash in their tickets until the game resumes. Harris said lottery and consumer protection employees will work through the weekend to get the game back online as soon as possible.

“This is an isolated incident with a specific game and it’s important that it was detected and that we are determining the causes and fixing the game,” Harris said. “The integrity of the lottery is of prime importance.”

Just how some lottery agents were able to manipulate their machines is not clear, but investigators believe there was a vulnerability between the time a ticket was ordered at a terminal and when it was printed.

“They were able to slow down the machine and pull up a history,” Harris said. “Slowing down the machine meant that somehow there was a delay in the time a ticket was generated to when it was printed.”

During that delay, some agents were able to determine whether the ticket waiting to print was a winner or a loser, he said. They would void the losing ticket, but allow the winning ticket to print, he said.

Harris said he does not think those who manipulated the system were sophisticated hackers, but rather people who were able to figure out how the lottery terminals work.

The Connecticut Lottery and state Department of Consumer Protection shut down the 5 Card Cash game after noticing there were more winners than the game's parameters should have allowed, and determining that some lottery agents were manipulating machines to print more winning tickets and fewer losers.