Winner! How to Protect your Lottery Winnings

Posted by on Monday, April 2nd, 2012

If you are reading this, you probably didn’t win the Mega Millions lottery on Friday night, or you would be out buying a new car, house, or boat. There are three big winners of the $656 million prize, the largest lottery jackpot in American history. The chances of winning were approximately one in 176 million. Your chances of being a victim of a lottery related fraud or theft are much greater.

Money may not be the root of all evil, but greed can cause people to commit unethical and illegal acts. From the moment you buy your lottery ticket, until you cash in a winner, there may be someone who wants to take the prize away from you.

Lottery Pools

Buying tickets as a group can increase your odds of winning, but it can also lead to fights over any winnings. If you get together with a social or work group to purchase lottery tickets in a pool, you need to take preventative measures to ensure that there is no bitter end attached to your win.

Five New Jersey construction workers are still waiting for their money from a lottery win in 2009. A jury recently ruled that the five were cheated out of their share by a co-worker, Americo Lopes. He claimed that the winning ticket was a personal purchase and not the ticket he bought for the pool.

This is just one of many lawsuits brought over disputes in winning lottery pools. Here are some tips to avoid these problems:

  • Have every member of the pool sign an agreement stating the amount of money each person is contributing, how the winnings will be split, and outlining a schedule for buying tickets. Click here to see a sample of a lottery pool agreement.
  • Make sure all pool members are over 18 years of age.
  • If one person is in charge of buying tickets, that person should agree not to purchase any personal tickets for that same lottery, otherwise they could claim that the winning ticket was the one that they purchased for themselves.
  • Agree on the location where the tickets will be purchased.
  • As soon as the tickets are purchased, photocopies of all the tickets should be made and handed out to all of the group members.
  • The tickets should be kept in a safe place, for example, if it is a work pool, they should be kept onsite and not at the home of one of the group.

Lottery Retailer Fraud and Theft

Many winners have lost sight of their money behind the counter of their neighbourhood convenience store. State lottery officials have devoted large resources to investigating lottery retailer fraud and theft.

The TV show Dateline worked with state lottery investigators to uncover theft of winnings.  Dateline shows how convenience store or other retail clerks get away with this crime over and over again. Lottery investigators attended

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a number of locations  to check the honesty of retail clerks handed a winning ticket. The scenario usually went like this: The investigator handed the ticket to the clerk and asked him or her to check it. Meanwhile, the investigator walked around the store for a few moments and when he  came back to the counter, the clerk told him that he had won $4. The ticket was actually a $500 winner. This scam or other similar acts happened on a number of visits to different stores.

Unethical retailers keep winning tickets worth small amounts on hand and substitute them with your winning ticket. Most lottery machines make a noise when a winning ticket is presented, however  as Datelines shows, retail clerks can circumvent this by not scanning the correct ticket into the machine. A bit of work on your part can prevent this:

  • One of the best ways to protect yourself is to sign your ticket after you purchase it. Make a copy of the ticket and keep it in a safe place.
  • Check your ticket before going to the store. You can watch the draw live on TV, check your ticket numbers on the lottery website or newspaper.
  • Some retail stores have ticket checker machines where you can check the ticket on a scanner before handing it over to the clerk, although some of these machines will just tell you that your ticket is a winner and not give the amount.
  • If you feel that a retailer is dishonest or hasn’t given you correct information regarding your ticket, ask for the ticket back, even if they tell you it is not a winner. Take it home and contact the lottery office.

You’ve won! Now what?

If you are lucky enough to win a huge jackpot, your life will change, and not always for the better. People will come out of the woodwork looking for handouts. Because you will be made famous and your face and name will be all over the media, complete strangers will contact you with sob stories, asking for money. Scam artists will try to pry some of those winnings out of your hands. If you don’t know how to manage large amounts of money, unscrupulous people may come forward with bad investments. If you have a winning ticket worth thousands or millions of dollars, you need to think before you act. It is difficult, because the excitement will be overwhelming.

  •  If you haven’t done so, make copies of the ticket and keep the ticket in a safe place.
  • Don’t spread the news around. Keep a low profile and wait a few days before you cash your ticket, while you put a plan together.
  • After you cash in the ticket, you may want to stay in a hotel for a few days to avoid people coming to your home.
  • Your money may be paid in a lump sum or a payout, find this out.
  • You should also know what kind of income tax you will have to pay on winnings.
  • Hire a lawyer and consult with a trustworthy accountant. Do not take advice from financial planners you don’t know.
  •  You may want to get an unlisted telephone number or a second line because the calls are going to start pouring in.
  • Discuss with your family how you are going to handle your newfound wealth. Many lottery winners who have won enough money to last for the rest of their lives, if managed properly, ended up broke and with broken relationships because they went crazy with their winnings.
  • Consider who you want to help with the money and figure out how you are going to turn down those who come to you asking for handouts.

Go ahead and quit your job if you want, but wait until after the dust has settled. Take a few days off and when the announcement has been made, give your notice. You may want to start your own small business, or do volunteer work. Winners who completely give up their former lifestyle and spend their time buying things often find out that money doesn’t buy happiness and they go on to lead unfulfilled lives.

If you didn’t win, there is always another chance. “If you don’t play, you can’t win.” I can’t tell you how many times I’ve heard this from people. These are the same people who spend an inordinate amount of their income on lottery tickets.  You have more chance of being hit by lightening than winning thousands or millions in a lottery. Playing the lottery is gambling and if you spend more than you can afford on a regular basis, you have a problem. Have fun, but play responsibly. Good luck!


Former FBI Assistant Director Tom Sheer has recruited the best from the FBI, DEA, IRS and Secret Service to build a formidable team at Sheer Investigations. Our private investigators have the sensitivity and experience to handle the most delicate investigations.

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