OK. For better or worse, I got pandemic air and I'm in my jogging shorts. My name's Reid for Grabe. I'm a writer in Minneapolis and I wrote a story a couple years ago from New York Times magazine. It's a story about a digital keeper that somehow becomes a story about concealed identities. I object, Your Honor.
This trial is a travesty. It's a travesty of a mockery of a sham. Shady attorneys and ethical fireworks salesmen, malicious computer code, a mysterious past, baseball news and most importantly, about who we can call big foot hunters.
My friends, anyway.
Seven or eight hundred pound. At its core, this is a story about a heist. It's a scam. It's the largest lottery scam in American history. And I do think that this is ultimately a story that's about morality.
It's about greed and hubris and good and evil. And the good guy chase the bad guy. And the good guy in this story is the dude and Rob Sand. He's a prosecutor for the state of Iowa. And Rob is someone with just an incredibly strong moral compass. It's so strong that even family and friends have made fun of him for his life, for being a little bit too much of a square. But honestly, when I look at Rob as a character, he's a breath of fresh air.
Just in that we're in this age where morality seems so muddled beginning and tell the difference between fact and fiction. And yet Ron can tell you this is right and this is. It gives me a little bit of hope that righteousness really can make a comeback in this crazy world. So here's my story. The man who cracked the lottery read by Eric, Jason Martin.
The file landed on Rob Sands desk with something less than a thud. Despite holding the contents of an investigation still open after more than two years, the file was barely half an inch thick. Happy birthday. His boss said. It was not Rob Sande's birthday. His boss and Iowa deputy attorney general named Thomas H. Miller was retiring in July 2014 after nearly three decades of prosecuting everything from murder to fraud. He hired Sand about four years earlier and made him the youngest prosecutor in a nine attorney team that handled challenging cases all over the state.
Now, Miller was offloading cases to colleagues. This one having to do with a suspicious lottery ticket worth sixteen point five million dollars was full of dead ends. Investigators didn't even know if a crime had been committed. The most tantalizing pieces of evidence were on a DVD. Two grainy surveillance clips from a gas station. Sand slid the disc into his laptop and pressed play.
A man walked into a quick trip convenience store just off Interstate 80 in Des Moines. It was a weekday afternoon, two days before Christmas. The hood of the man's black sweatshirt was pulled over his head, obscuring his face from two surveillance cameras overhead under the hoodie. He appeared to be wearing a ball cap over the hoodie. He wore a black jacket. The man grabbed a fountain drink and two hot dogs. Hello? The cashier said brightly. The man replied in a low pitched drawl, a voice that struck sand as distinct low.
Couple of hot dogs? The cashier asked. Yes, sir, the man replied quietly, his head down. The man pulled two pieces of paper from his pocket. They were placed slips for hot lotto Powerball like lottery game available in 14 states and Washington, D.C., a player were the games computer picked five numbers between one and thirty nine. And then a sixth. No, known as the hot ball between one and 19. The prize for getting the first five numbers right was ten dollars.
But a much larger prize that varied, according to the number of players who bought tickets went to anyone who got all six numbers right. The record hot lotto jackpot of nearly 20 million dollars had been claimed in 2007. The jackpot at the time of this video was approaching the record. The stated odds of winning it were one in 10 million nine hundred thirty nine thousand three hundred eighty three. The cashier took the man's place lips, which had already been filled out with multiple sets of numbers at 324 p.m..
The cashier ran the slips through the lottery terminal. An older man with a cane limped by the refrigerated section. A bus drove by. The cashier handed over his change. Once outside, the man pulled down his hood and removed his cap, got into his SUV and drove away. The gas station parking lot gleamed. There had been snow flurries that afternoon. Two years into the case, that was virtually all the investigators had sand, watched the video again and again, trying to pick up every little detail.
The SUV is make the man's indistinct appearance, most likely in his 40s and 100 pounds overweight. Maybe more the tenor of his voice. Sand baby faced Iowan who turned down Harvard Law School for the University of Iowa College of Law, had a background that seemed perfect for the case. A high school job, writing computer code and doing tech support, a specialty in white collar crime. His recent cases included securities fraud and theft by public officials. The ticket in the video was purchased on December 20 3rd, 2010.
Six days later, the winning hot lotto numbers were selected. Three. Twelve. Sixteen. 26. 33. Eleven. The next day, the Iowa lottery announced that a quick trip in Des Moines had sold the winning ticket. But one month after the numbers were drawn, no one had presented the ticket. The Iowa lottery held a news conference. Phone calls poured in, dozens of people claimed to be the winner. Some said they had lost the ticket.
Others said it was stolen from them. But lottery officials had crucial evidence that wasn't publicly available. The serial number on the winning ticket and the video of the man buying it one by one, they crossed off prospective claimants. One caller said his friend was a regular hot lotto player who had just died in a car wreck. Should he go to the junkyard to search through his deceased friend's car? Three months after the winning ticket was announced, the lottery issued another public reminder, another followed at six months and again at nine months, each time warning that winners had one year to claim their money.
I was convinced it would never be claimed, says Mary Newbauer, the Iowa lotteries vice president of external relations. Since 1999, she had dealt with around 200 people who had won more than one million dollars. She'd never seen a winning million dollar ticket go unclaimed. And then comes November nine, 2011, a man named Philip Johnston, a lawyer from Quebec, called the Iowa Lottery and gave newbauer the correct 15 digit serial number on the winning hot lotto ticket.
Newbauer asked his age in his 60s, he said, and what he was wearing when he purchased the ticket. His description, a sports coat and gray flannel dress pants, did not match the Quick Trip video. Then, in a subsequent call, the man admitted he had fibbed. He said he was helping a client claim the ticket so the client wouldn't be identified. This was against the Iowa lottery rules, which require the identities of winners to be public.
Johnston floated the possibility of withdrawing his claim. Newbauer was suspicious. The winners anonymity was worth sixteen point five million dollars.
One year to the day after the winning numbers popped up on the random number generator computers and less than two hours before the four p.m. deadline. Representatives from a prominent Des Moines law firm showed up at the Iowa lottery's headquarters with the winning ticket. The firm was claiming the ticket on behalf of a trust. Later, the Iowa lottery learned that the trust's beneficiary was a corporation in Belize whose president was Philip Johnston, the Canadian attorney. It just absolutely stunk all over the place, says Terry Rich, chief executive of the Iowa Lottery.
The Iowa attorney general's office and the Iowa Division of Criminal Investigation opened a case. In an interview in Quebec City, Johnston told investigators that he had been contacted about the ticket by a Houston attorney named Robert Sonfield. Johnston also pointed investigators toward a Sugarland, Texas, businessman named Robert Rhodes. A trip to Texas by Iowa investigators proved fruitless during their several days there. Both Sonfield and Rhodes managed to avoid them. By the time the file ended up on the desk of Rob Sand in 2014, the case had acquired cult like status.
In his office, it was spoken about with gallows humor. We'll find the guy who bought the ticket, ended up getting offed. Sands said that's what this is going to turn out to be a murder case. Miller had mentor, descend and saw in him a kindred spirit, someone for whom practicing law was a calling, sometimes sends moral compass was so steady that he came off as a square. His brothers in law nicknamed him Baby Jesus. Sand grew up in de Kaura in northeast Iowa.
The son of a small town doctor who still made house calls. He wanted to get into white collar criminal prosecution because it focused not on crimes of desperation, but on crimes of greed. Crimes against gratitude. Called them. But all he had was grainy video of a man buying a lottery ticket worth sixteen point five million dollars. We only had one bullet left in our revolver. Sam says, and that was releasing the video. On October 9th, 2014, nearly forty six months after the man in the hoodie left the quick trip, the Iowa Division of Criminal Investigation put out a news release that included a link to a 74 second clip of the surveillance footage a few days later.
In Maine, an employee of the Maine lottery opened an email forwarded from his boss. The employee recognized the distinct voice in the video. It belonged to a man who had spent a week in the Maine lottery offices a few years earlier conducting a security audit in Des Moines. A web developer at the Iowa lottery who watched the video also recognized that voice.
It belonged to a man she had worked alongside for years. A receptionist in another lottery office handed her earbuds to Noel Krueger, a drawer manager, and told her to listen. Why am I listening to a video or listening to a tape of Eddie Krueger replied by Eddie. She meant Eddie Tipton, the information security director for the Multi-State Lottery Association.
The organization runs lotteries for 33 different states, plus the District of Columbia, Puerto Rico and the U.S. Virgin Islands. It was based in the Des Moines suburbs. Among the games it ran was the hot lotto.
Eddie Tipton, could a big friendly figure around the office of the Multi-State Lottery Association. He grew up in rural Texas, but while his siblings were outside, he was always in his room fiddling with his computer. He was a paranoid sort who rarely paid with credit cards, who worried about people tracing his identity. But he always wanted people to like him. When a coworker was in a bad mood. One colleague said Tipton would put him on the shoulder and say, I just want you to know I'm your friend.
Tipton built a 48 hundred square foot five hundred forty thousand dollar house in the cornfields south of Des Moines. The house had five bedrooms and a huge basement, including a pool table, a shuffleboard table, a stadium style home theater with couches and a space he considered turning into a basketball court. Friends wondered by a single man needed such a big house and how he could afford it on a salary just shy of one hundred thousand dollars a year, in private moments, Tipton told them he was lonely and wanted a family more than anything.
So he poured his savings into the house he hoped to fill with a wife and children. But the right partner never came. Instead, he hosted office Christmas parties and he constantly asked friends to visit his family still in Texas, checked on him frequently. His life revolved around his job. The Multi-State Lottery Association was a small organization, and Tipton felt overextended. He wrote software and worked on Web pages. He handled network security and firewalls. And he reviewed security for lottery games in nearly three dozen states.
He was putting in 60 hour weeks and staying at the office until 11:00 p.m.. When Ed Steffen, the chief information officer and chief security officer at the Multi-State Lottery Association, saw the surveillance video, he didn't want to believe it. This wasn't just some co-worker. This was Eddie Tipton, a man he had known for more than two decades since they were in calculus class at the University of Houston. Stefan met his future wife while he and Tipton were on a charity bike ride in Texas.
Tipton would later be in their wedding. Stefan helped Tipton get his job at the association. They bought some 50 acres of land together and built adjacent houses. They even applied for a joint patent for computer based lottery security. Stefan watched the convenience store video for the first time after a former co-worker sent him the link that had been released by prosecutors. That just can't be Eddie. He thought then. That's Eddie. Why is he wearing a hoodie? I've never seen Eddie in a hoodie.
Stefan got sick to his stomach. His friend, a man with deep knowledge of the computers that ran the lottery, was there on screen buying a ticket. That would be worth sixteen point five million dollars later. Stefan would tell investigators it was like finding out your mother was an axe murderer. He felt betrayed. Jason Marr was another friend and colleague who didn't want to believe what he was seeing on the video. He and Tipton had met at Tucky, a Japanese restaurant outside Des Moines that they both frequented.
The lifelong computer aficionados and gamers hit it off. Tipton joined Mars Gaming Clan and they spent hours playing the multiplayer online game World of Tanks. Tipton suggested Mahrer apply for a job at the Lottery Association as a network engineer. Tipton, Ma told me, had a heart of gold. So when Mara saw the video and heard that familiar low pitched voice, he did what a computer whiz does. That night I sat down. There's no way that he did this.
Mara said, there's got to be something wrong. He put the file of the surveillance tape into audio software, removed white noise and isolated the voice. Then he took footage from security cameras in his house. Tipton had just visited the night before. And compared to Tipton's voice in that footage with the convenience store video. It was a complete and utter match, Soundwave and everything, Myers said. The next day he went to the quick trip where the ticket was purchased and measured the dimensions of the tiles on the floor.
The height of the shelving units. The distance between the door and the cash register. He used the results to compare the hand size, foot size and height of the man in the video with the man he had become friends with. When the FBI guys came in, I wanted to be able to tell them it wasn't Eddie. Mara said. Once I did this, it was like, well. You want a diverse portfolio, so you'll have to do a lot of legwork, right?
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In November 2014, state investigators showed up at Tipton's office. They asked him whom he knew in Houston.
He told them about his family. Mother, sister and brothers, including Tommy, a former sheriff's deputy turned justice of the peace near the Texas Hill country. He did not mention Robert Rhoades, the man who initially passed the sixteen point five million dollar ticket to an attorney by searching Tipton's LinkedIn profile. Investigators found that Tipton had been employed at Rhodes's Texas based software company System's Evolution for six years as its chief operations officer. In fact, the two were best friends and vacationed together.
Tipton was arrested in January 2015 and charged with two felony counts of fraud. Half a year later, on a hot, sticky July morning, Rob Sand stood before a jury at the Polk County Courthouse. This is a classic story about an inside job. He began a man who, by virtue of his employment, is not allowed to play the lottery nor allowed to win, buys a lottery ticket, wins and passes the ticket along to friends to be claimed by someone unconnected to him.
This story, though, has a 21st century twist. The prosecution knew Tipton had bought the winning ticket. The video, specifically the distinct voice that colleagues had recognized, made that clear. So did cell phone records, which showed Tipton was in town that day, not out of town for the holidays, as he claimed, and that he had been on the phone for 71 minutes with Robert Rhoades, the man who briefly had possession of the ticket. Investigators believe he'd fixed the lottery.
But how Jason Maas, Tipton's gaming buddy, told them about Tipton's interest in route kits, malicious software that can be installed via a flash drive in order to take control of a computer while masking its existence until it deletes itself. Later, Sand theorized that Tipton went into the draw room six weeks before the big jackpot. And despite the presence of two colleagues, managed to insert a thumb drive into one of the two computers that selected the winning numbers. That thumb drive contained the rootkit.
The rootkit allowed Tipton to direct which numbers would win the hot lotto. On December twenty ninth, 2010. Tipton's defense attorney, Dean Sauers, called this the Mission Impossible theory. Stammers Characterized the story of a malicious, self-destructive rootkit magic software installed while two colleagues looked on as preposterous. His closing arguments referenced a quotation attributed to Albert Einstein. Logic will get you from A to B. Imagination will take you anywhere. But sand cold sours is focus on this complicated rootkit theory, a red herring.
Sand told the jury to focus on the many ways Tipton could have fixed the lottery. He wrote the code. He had access to the random number generator machines before they were shipped to other states. You don't have to understand the exact technology to convict, Tipton, Sand argued. You just have to realize the near impossible coincidence of the lottery security chiefs buying a winning ticket and that tickets being passed to his best friend. The prosecution had to prove only that Tipton tried to illegally buy lottery tickets as a multi-state lottery association employee and tried to claim the prize through fraudulent means.
The jury found him guilty on July 20th, 2015. He would be sentenced to 10 years in prison and he would appeal. The state Supreme Court later dismissed his conviction on one charge, tampering with lottery equipment. And the case was sent back to district court. Six weeks after the trial concluded, Sand had returned to his desk. It had been a busy summer. But in the back of his mind, he was still thinking about it, he Tipton Sand new white collar criminals aren't usually caught on their first attempt.
The fact that Tipton's attorney had demanded a 90 day speedy trial, an unusual maneuver that cut short the prosecution's time to investigate may descend suspicious. His gut said other fraudulent lottery tickets were out there. One morning, Sande's office phone rang and an area code he recognized popped up to eight one from Texas, where Tipton used to live. Sand picked up the color, had a drawl and told Sand he'd seen an article in the La Grange, Texas newspaper about Tipton's conviction.
Did y'all know, the tipster asked, that Eddie's brother, Tommy Tipton, won the lottery maybe about 10 years back. Richard, Renaissance phone rang at the FBI office in Texas City, a port town on the shore of Galveston Bay. Sand was on the line inquiring about a case that Rennison, a special agent for the bureau, investigated a decade before. At the time, it turned out to be nothing but the case still stuck in Renaissance mind.
Hey, Rennison replied, that's my big foot case. A man named Tom Barcus had contacted local law enforcement authorities in early 2006 with a suspicious story. Barcus owned 44 fireworks stands in Texas twice a year after the Fourth of July and after New Year's, he had to handle enormous amounts of cash, more than a half million dollars at once. A local justice of the peace who shot the Barcus, his horses called him around New Year's. The Justice of the Peace Court baugus off guard.
I got half a million in cash that I want to swap with your money. What's wrong with your money? Vargas replied. What's a justice of the peace, who makes around thirty five thousand dollars a year doing with that much cash? Vargas thought he called the sheriff and the police who called the FBI. Soon, the bureau contacted Vargas. Federal agents outfitted him with a wire. Vargas met with the man who pulled out a briefcase filled with 450000 dollars in cash still in their Federal Reserve wrappers as the FBI listened.
Vargas swapped one hundred thousand dollars of WAUN circulated bills for one hundred thousand dollars of the man's crisp, unused bills to the FBI. This smelled like public corruption, and they went to work investigating the serial numbers on the bills. One day, a couple of months later, Rennison got a call from the Fayette County sheriff in La Grange, a place best known for the Chicken Ranch, the brothel that inspired the Best Little Whorehouse in Texas. The sheriff was laughing so hard he could hardly speak.
He told Rennison The Justice of the peace was holed up in a Houston hospital with two shattered legs. He had fallen 31 feet out of a tree. He had been hunting Big Foot.
My grandmother was raised on a farm in Arkansas where this creature would come in and harass all the farm animals. This man later told investigators, my grandmother would tell me all these stories of this animal that harassed my family. He went on, I started hitting the woods. It was always that doubt in your mind. And then something happened to me in Louisiana where I actually watched these animals for a couple of hours. And I've been hooked ever since. Rennison visited the man in the hospital and then set up an interview.
Once he was discharged, the man was a member of the Big Foot Field researchers organization. He told Rennison he'd won the lottery in Colorado while on a big foot hunt. He was on the outs with his wife and was trying to keep the lottery winnings from her big foot hunting friend claimed the prize in exchange for 10 percent of the money. It all checked out. Case closed right before I leave. We're still sitting down at this nice conference table and he looks over at his attorneys and says, Can I show him?
Rennison recalled. Hanging off the back of his chair is a plastic grocery bag. He pulls out a plaster cast of a footprint. Rennison put the footprints next to his own foot. They were roughly the same size. That doesn't look like Big Foot. The FBI agent said it was a juvenile. The man snapped. The man's name was Tommy Tipton. Now, the hunt was on for more illicitly claimed tickets. Iowa investigators noticed that the friend who claimed the five hundred sixty eight thousand nine hundred ninety dollar Colorado lottery prize for Tommy Tipton, a man named Alexander Hicks, was dead.
We first thought, whoa, this is our first body related to this case. Sands says it wasn't. Hicks had died of cancer. The investigators collected a decade's worth of winners from lotteries around the country associated with the Multi-State Lottery Association.
They loaded data from approximately 45000 winning tickets into Microsoft Excel spreadsheets and searched for any connections to Eddie Tipton. They reviewed Tipton's Facebook friends, pulled phone records and looked for matches with the spreadsheet. In September 2015, they learned that a seven hundred eighty three thousand two hundred fifty seven dollars and seventy two cents payout for Wisconsin's very own megabuck scheme had been claimed in early 2008 by a Texas man named Robert Rhodes, who wanted to deposit it into the account of a limited liability corporation.
That drawing took place on December twenty ninth, 2007, the same day the winning numbers on Tipton's sixteen point five million dollar Iowa ticket were selected. Three years later, Rhodes was at a Tipton's best friend. Another hit. One evening over the holidays, Sand was at his parents house, working on his laptop, sifting through records, using search commands on his computer again and again. He noticed that a Kyle come from Hemphill, Texas, one to six hundred forty four thousand four hundred seventy eight dollars jackpot in the Oklahoma Lottery some years back.
Tommy Tipton had three Facebook friends named Khan. Sand got a list of possible phone numbers for Kyle Khan and cross-referenced them with Tommy Tipton's cell phone records. Another hit. Investigators noticed two winning Kansas lottery tickets for fifteen thousand four hundred two dollars apiece were purchased on December twenty third. 2010, the same day Tipton had purchased the Iowa ticket and the same day that cell phone records indicated he was driving through Kansas on the way to Texas for the holidays. One of the winning tickets was claimed by a Texan named Christopher Mikulski.
The other by an Iowa woman named Amy Work. Each was a friend of Eddie Tipton's. Early one morning, sand and an investigator knocked on the woman's door. She told them she'd gone on one date with Tipton, but their relationship became platonic. Tipton told her he wasn't able to claim a winning lottery ticket because of his job. If she could claim it, Tipton said she could keep a significant portion as a gift for her recent engagement. You have these honest dupes.
Sands says all these people are being offered thousands of dollars for doing something that's a little bit sneaky but not illegal. Investigators in Iowa now had six tickets. They figured were part of a bigger scam. But the question remained, how did it work? Investigators in Wisconsin discovered they still had the random number generator computers used for the 2007 jackpot sitting in storage. Unlike Iowa's computers, the hard drives had not been wiped clean. Their software was the same as the day Robert Rhoades won seven hundred eighty three thousand two hundred fifty seven dollars and seventy two cents.
Wisconsin enlisted a computer expert named Sean McAlinden to conduct an investigation that included forensic analysis and reverse engineering.
On January 7th, 2016, Sanders phone rang. It was David Moss, an assistant attorney general in Wisconsin. He told Sand to check his e-mail. Must had sent him an attachment with twenty one lines of pseudo code come in language. Translation of McLinden is forensic analysis that showed part of Tipton's malicious computer code.
The code was small enough that it would not radically change the size of the file, which might create suspicion. And the code hadn't been hidden. You just needed to know what to look for. This, Musk says, was finding the smoking gun.
The smoking gun would help lead to a guilty plea from Tipton in the plea deal, Sand insisted that Tipton come clean about how he fixed the lottery. This could help the lottery industry improve its security. If Tipton lied or if another fraudulent ticket were found later, the deal would be voided. And Tipton would be subject to further charges. Tipton's program was called Cuvee Are Engy Dots, DL, Quantum Vision, Random Number Generator. In Tipton's, telling his wasn't an evil plan to get rich.
This was just a computer nerds attempt to crack the system. It was never my intent to start a full out ticket scam, Tipton told investigators. It occurred to me like, wow, I could do this. I could be making a living doing this. He went on, If this was like some mob related thing, I'd just give this information to the mob and they would go out and win the lotteries left and right. Nobody would know. But that guy don't have any mob ties.
I don't know anybody. I gave tickets to friends or family. More than a decade ago, Tipton told them he walked past one of the organization's accountants at the Multi-State Lottery Association. Tipton was conservative. The accountant liberal. And they often rib each other. Hey, did you put your secret numbers in there? The accountant said teasing tipped him. What do you mean? Well, you know, you can set numbers on any given day since you wrote the software.
And that's when the idea first came, just like a little seed, but was planted. Tipton said in his proffer. And then during one slow period, I just had a had a thought that it's possible. And I tried it and I put it in the code wasn't a brazen Mission Impossible stunt of sneaking into the drawer room with a malicious thumb drive. It was a simple piece of code, partly copied from an Internet source inserted by the one man responsible for information security at an organization that runs three dozen United States lotteries.
Here s the Multi-State Lottery Association's random number generators were supposed to work. The computer takes a reading from a Geiger counter that measures radiation in the surrounding air. Specifically, the radioactive isotope Americium 241. The reading is expressed as a long number of code. That number gives the generator its true randomness. The random number is called the seed and the seed is plugged into the algorithm. Pseudo random number generator called the Merson twister. At the end, the computer spits out the winning lottery numbers.
Tipton's extra lines of code first check to see if the coming lottery drawing fulfilled. Tipton's narrow circumstances. It had to be on a Wednesday or a Saturday evening. And one of three dates in a non leap year. The 140 seventh day of the year. May twenty seventh. The three hundred twenty seventh day. November twenty third. Or the 360 third day. December twenty ninth. Investigators noticed those dates generally fell around holidays, Memorial Day, Thanksgiving and Christmas.
When Tipton was often on vacation, if those criteria were satisfied, the random number generator was diverted to a different track. Instead, the algorithm would use a predetermined seat number that restricted the pool of potential winning numbers to a much smaller, predictable set of numbers.
So Tipton knew what no one else knew for the Iowa hot lotto drawing on December 29, 2010. There weren't really 10 million nine hundred thirty nine thousand three hundred eighty three sets of possible winning numbers. There were only a few hundred late at night before a draw. That fulfilled his criteria. Tipton stayed in his messy, computer filled office. He said a test computer to the date and time of the coming draw. And he ran the program over and over again for the first lottery.
He rigged the November twenty third 2005 drawing in Colorado. Tipton wrote down each potential set of winning numbers on a yellow legal pad. He handed the pad. Each sheet had thirty five or so sets of six numbers to his brother. It was a cheat sheet. Instead of playing every possible number combination to ensure one combination one, he had to play only a few hundred. If you want a chance to win, you need to play all of these, Tipton told his brother.
I don't know if any of them will win, but you're going anyway. His brother was about to go on a big fun hunting trip to Colorado and these have a good chance of winning. Based on my analysis. Play them, he said. Play them all. On a clear blue summer day in Des Moines last year at a Tipton Square shaped, balding man who was then 54, trudged up the stairs of the Polk County courthouse. He wore blue jeans and a short sleeved salmon colored button up shirt untucked and unbuttoned with a blue t shirt underneath.
His hands were shoved in his pockets and his head was down. He had accepted a plea agreement for masterminding the largest lottery scam in American history. One count of ongoing criminal conduct, part of a package deal that allowed his brother to be sentenced to only 75 days. Tipton was here for his sentencing. In statements to prosecutors, Tipton painted himself in the most generous way possible, a kind of coding Robin Hood, stealing from the lottery and helping people in need.
His brother, who had five daughters, his friend who'd just gotten engaged. I didn't really need the money. Tipton's said. The judge noted that Tipton seemed to rationalize his actions, that Tipton didn't think it was necessarily illegal, just taking advantage of a hole in the lotteries system. It wasn't all that different. Tipton believes from insider trading, except laws didn't specifically prohibit him from fiddling with the random number generator code. His attorney equated what he did with counting cards at a casino.
Tipton wasn't robbing the casino at gunpoint. He was cheating the house. The other side disagreed. Tipton was nothing but a common thief who happened to be handed the keys to the candy store. Miller, Sande's former boss, told me it's not a case of Sherlock Holmes as arch nemesis Moriarty being a criminal genius. This is just a regular schlub who is a thief who happens to have knowledge of computer security.
From Tipton's point of view, it was complicated. He had done something to see if he could do it. To his surprise, it worked. He said he inserted that code only once after the code was approved by gaming laboratories. International machines containing it were shipped all over the country. He had created a beast and sent it into the world. You plant that money tree in your backyard as moss, that Wisconsin prosecutor put it. And it's hard not to keep picking at it.
In interviews, investigators had asked Tipton if he was proud of the success of his code. It was more like, I'm ready for it to be gone. Tipton's said. It was never my intent to go out there and start winning all these lotteries. It was just, like I said, step by step. It happened at sentencing. The judge asked if Tipton had anything to say. After a long pause, Tipton cleared his throat. Family members and former co-workers were in the courtroom.
Well, Tipton said matter of factly that I certainly regret my actions. It's difficult to say that the bowl, the people behind me that I hurt and I regret it. I'm sorry. As the case was being litigated. Tipton had confessed to friends that he was wracked with guilt at another point during the proceedings. Tipton leaned across a divide and extended his hand to sand. Sand took the handshake as a sign of respect, as if Tipton had thought he outsmarted the system.
But the system figured him out. On the day of his sentencing, Tipton told the judge he'd been taking classes to go into ministry. A deputy's placed Tipton in handcuffs and led him away. Earlier in the summer, Tipton said in a conference room with sand and law enforcement and lottery officials to give his full confession as promised in his plea agreement. Eventually, he would head to Clarinda Correctional Facility in southern Iowa, near the Missouri border where he remains today.
Offender number six eight three two nine seven five. Through his attorney, he declined interview requests for this article. Tipton did not respond to nearly a dozen e-mails through the prison email system. During a lunch break in Tipton's hours long confession, Sand and others involved in the prosecution walked a few blocks to the highlife lounge. They ordered bacon wrapped tater tots to celebrate. He sees himself as much brighter than the rest of the world. The sharpest tool in the toolbox, Sam says.
It's the kind of thing I see in white collar case after white collar case. People who think they're better than everybody else, that people trust them and love them, and that no one will be able to figure this out. The judge sentenced Tipton to a maximum of 25 years in prison. His restitution payments to the various state lotteries came to two point two million dollars, even though, according to his attorney, Tipton pocketed only around three hundred fifty thousand dollars from the scam.
The rest going to those who claimed the tickets. Prosecutors did not believe that, pointing to Tipton's massive house, as well as the fact that Tipton and his brother owned eleven pieces of property, either jointly or individually in Fayette County, Texas. In Iowa, which has indeterminate sentencing, a 25 year sentence could mean Tipton is released much sooner. Sand expects Tipton to be released by the Iowa Board of Parole within seven years. Sands says he felt a deep intellectual satisfaction in solving the puzzle, the justice system, at its best, is really about a search for truth.
But it couldn't go back in time and correct wrongs. At the end of this year long case, he came to a realization he had grown weary of dealing with criminals in so much darkness. Sands says, I started to lose my life. A few months after the highest profile case of his career, Sand went up to his boss and quit. He had decided to run for state auditor in the coming November election so he could make positive changes. If he wins, he will be investigating government waste, abuse and fraud.
There's no way I would make a move to get away from the darkness of prosecution without finishing this case first. Sand says. So finishing it to me was not merely satisfying, it was liberating. This was recorded by autumn. Autumn is an app you can download to listen to lots of audio stories from publishers such as The New York Times. Do you avoid tough problems and shy away from a debate? Do you think uncertainty limits potential? Neither do we at the University of Chicago Booth School of Business.
We believe in asking questions and questioning answers. With campuses in Chicago, London and Hong Kong, the booth MBA is for people who see challenges as opportunities and want the skills to make positive change in any markets anywhere in the world. Ready to find your community? Search Chicago. Boost at eighty two today to learn more.