Real Lottery Winners To Get Their $5.7 Million Prize, After Man Charged With Fraud

What if you won $5.7 million and never saw a dime? That was the frustrating scenario that greeted four lottery winners, who say they were taken advantage of by an allegedly unscrupulous convenience store owner. But those who oversee the lucky number draws vow they’ll get what’s due them, while the law claims the same thing about the man accused of defrauding them.

Ontario Lottery and Gaming Corp. CEO Kelly McDougald confirms that four people did, in fact, purchase a winning 6/49 ticket three years ago – and they’ll be paid what they won plus interest.

The payout became necessary after the OPP charged a Mississauga convenience store owner with fraud for allegedly bilking the not-so-lucky ticket holders out of their just desserts. Sixty-year-old Hafiz Malik allegedly claimed the big bounty in January 2005, half a year after the rightful winners – three women and a man who work for a school board – presented the ticket to him.

“Four rightful owners were deprived of a lottery win that would have changed their lives,” observes OPP Chief Supt. Bob Goodall, adding that $5 million in assets was seized from Malik. His bank accounts have been frozen and his home and three cars have been taken away from him.

This latest scandal to hit Ontario’s lottery has taken three years to surface. The winners originally went to Malik’s store to check their ticket three years ago, but only began to suspect they’d been duped in July. They raised the roof and their complaints were heard by police and lottery personnel, who stepped in to resolve the apparent deception.  

“We are glad to be paying the group this prize,” McDougald relates in a statement. “The OLG conducted its own thorough and independent investigation that confirmed the group’s claim that a winning ticket paid out to someone else several years ago was in fact purchased by them.”

Each recipient will get a cheque for about $1.4 million along with lost interest worth $800,000.

Needless to say the rags to riches recipients are ecstatic that their long denied winnings will be coming home. “It will be nice to have financial security in our retirement years,” explains Lorraine Teicht. “We plan on taking some holiday time and buy the car of my dreams: a Nissan Murano!” She’s been lucky before, having won a van in the Princess Margaret Hospital giveaway.

Paul Carlisi plans to buy some waterfront property and use the money to travel. But he also has another idea in mind for some of the cash that only a millionaire would dare consider: “A pearl necklace for the cat,” he outlines.

“We will still be the same people we’ve always been,” vows Silvana Pincivero. “This allows us to help our children plan for their future, and live a more stress-free lifestyle,” which includes a lot more vacations.

And Aurora Pincivero’s delayed good fortune will allow her to get out of debt. “Maybe now I can FINALLY take my kids to Disney World,” she laughs.

It’s the latest attempt by lottery officials to set right a system the Ontario ombudsman has found was going very wrong, with too many lottery retailers claiming big prizes. The report accused the OLG of ignoring fraud allegations relating to store owners winning huge jackpots too often and prompted police to probe the suspicious claims.

Malik appeared in court Wednesday for a bail hearing, charged with two counts of fraud over $5,000 and one count of theft over $5,000. He could face up to 10 years in prison if he’s convicted.

For now, though, the suspect walked out of the courthouse on Wednesday, disguised with a scarf over his face, mobbed by reporters demanding to know his reaction. He pushed through the crowd as he and a female companion waded towards a waiting car. It sped away without him saying a word.

The revelations have reignited all those old concerns about playing the games of chance. “I wouldn’t want to play it any more,” one man admits when asked about the latest incident.

But lottery officials insist they’ve cleaned up their act, instituting new rules for those claiming a big prize – including a mandatory signing of the ticket before it can be cashed. That practice officially begins in January, but you should really be doing it right now.

Here are some of the Ombudsman’s suggestions and what the OLG has done to implement them:

Recommendation: OLG should appoint someone to ensure the recommendations are carried out.

OLG Action: OLG appoints its senior vice-president to ensure compliance.

Recommendation: Because of the appearance of possible impropriety, OLG should treat all its sellers as Insiders and adopt a ‘zero tolerance policy’ when they come to redeem winning tickets.

OLG Action: OLG now tracks clerk wins of between $1,000 and $9,999 or any big prize claims. All will be treated as Insiders and subject to the new “Inside Win Policy”.

Their contract will be terminated if anything untoward is discovered, and retailers will lose the ability to sell tickets if they or their employees are charged with any crimes, involving theft or fraud or any “game related offenses.”

Recommendation: Retailers and employees claiming prizes of $1,000 or more will have to identify themselves before cashing the ticket.

OLG Action: Policy in place as of June 30, 2007.

Recommendation: OLG must track complaints about apparent prize improprieties involving retailers and kiosk clerks to make it easier to track what happened.

OLG Action: Corporate Security and Surveillance is now keeping track of all complaints that come into OLG from players. Full database in place as of June 30, 2007.

Recommendation: OLG investigators should be trained in better procedures and be required to keep all their notes when a probe is ordered.

OLG Action: Investigators are now being trained through the Ontario Police College and completed their classes by Sept. 30, 2007.

Recommendation: OLG hasn’t been keeping stats on the frequency of unusual prize claims by retailers or clerks.

OLG Action: Win histories tracked statistically as of April 30, 2007.

Recommendation: OLG must cross check prize claimants with insider winners.

OLG Action: All Insider winners over $1,000 are now checked out against their previous winning records.

Recommendation: OLG must submit a report on a quarterly basis on the progress of the recommendations, with a commitment to ensuring all are fulfilled.

OLG Action: Three reports submitted in 2007 with a fourth status report due March 27, 2008.

To read the full report, click here. (.pdf file)

The scandal led OLG to introduce new measures to fight fraud. Here’s a look at the way they told consumers that they tightened the rules:

The Seven Point Plan

1. Self-Serve Ticket Checkers

Every lottery terminal location in Ontario will have a device enabling consumers to electronically check their own tickets, and instantly determine if they’ve won and the size of their prizes. They’ll be available without the need to involve a retailer. Consumers can simply place the barcode on their tickets under the scanner to determine whether their ticket is a winner and if so, how much they’ve won.

2. Enforce Correct Retailer Validation Procedures

Lottery retailers will be permitted to check tickets only for those customers who have been asked to sign the back of their tickets. There will be escalating penalties for retailers who fail to follow correct validation procedures, up to and including the removal of their lottery terminals.

3. Customer-Facing Screen Improvements

Customer-facing video screens at lottery terminal locations in Ontario will tell players if they’ve won and if it’s a big prize after they have retailers check their tickets. Larger, bold characters appear on the screen to clearly indicate whether the customer has won. In the case of winning tickets, loud music plays and the prize amount is prominently displayed on the screen. Major prize wins of $50,000 or more trigger a different winning tune and a special message on the screen.

4. Public Education Campaign

OLG will conduct a public education campaign to make consumers aware of ways they can better protect themselves. The campaign will employ point-of-purchase signage and other forms of communication to inform consumers about the steps they can take, including:

Always sign the back of your ticket;
Check your numbers yourself here or on the winning numbers lists available at all retail locations; or by calling a toll-free line; 
If your ticket has won a prize larger than the retailer is able to pay make sure to retain your ticket and the validation slip

5. Solicit Consumer Input

OLG’s special toll-free telephone line will allow consumers to provide OLG with ideas on additional security measures. Call 1-800-387-0098 if you have any questions. OLG has also established an e-mail address that consumers can use to provide OLG with ideas. All suggestions will be documented and taken into consideration. Email playwithconfidence@olg.ca for more information.

6. Lower Investigation Threshold for Retailer Wins

OLG will use an expanded team of professional investigators to probe every win of $10,000 or more by lottery retailers and their employees, compared to the current $50,000 threshold. Each retailer win will be thoroughly investigated, including interviews with the retailer, and verification of purchasing information and previous playing statistics. If OLG believes there’s a serious concern with a retailer lottery prize claim, the police will be contacted immediately.

7. Enhanced Complaints Process and Investigation Procedures

OLG’s toll-free telephone line will allow for easier reporting of lost or stolen lottery tickets.  Improved complaint investigation processes will ensure all accusations are received appropriately and taken seriously.