Thursday, June 12, 2008
Editorial: Gaming the odds
The House always wins. Virginia Lottery increases its odds by knowingly selling losing tickets to unsuspecting buyers.
From the RoundTable blog
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The best way to beat the Virginia Lottery is to keep your money in your wallet. Lottery players already know what gamblers have known for ages: The odds of winning aren't in the players' favor. Still, as long as there is that one chance, why not try? But what if there isn't even that one, slim chance of winning the big prize? Only fools would still part with their money.
Virginia Lottery has made plenty of fools out of its scratch ticket players, according to number-cruncher Scott Hoover, by selling tickets long after the grand prize money has been claimed.
Hoover, a business finance professor at Washington and Lee, started tracking data posted on the lottery's Web site and realized "the numbers posted online violated basic laws of statistics."
He plans to file a class action suit on behalf of all duped players like himself. Hoover's odds of prevailing have to be much better than the zero chance he had of winning $75,000 on a ticket he purchased days after the big prize was claimed.
A lottery spokesman said he's confident Virginia Lottery complies with laws and regulations and "the expectations of our players."
They expect to at least have a chance to win. And they expect the lottery's Web site actually holds some value for figuring out their odds.
It does not.
Take the popular $5 Win for Life game, for example. The lottery posts the odds as 1-in-1,305,600 for winning the $1,000-a-week-for-life prize and 1-in-3.87 for any prize. But those odds were accurate only on Sept. 8, 2004, when the scratch game was launched.
The lottery Web site also shows how many of each prize remain (one from the original nine top prizes, for instance, and 143,395 of the 1.2 million bottom prizes) but it doesn't provide information about how many tickets are left so players can recalculate the odds. That would be a simple and fair fix.
But it's not possible because the lottery gums up the works by dumping more tickets into stale lots. As a popular game sells, lottery prints up another batch of the same game and sends them to vendors. These new tickets include winners -- but players can't know whether the tickets they buy are from the fresh game with new prizes or from the stale game where hardly any prizes are left.
Hoover thinks, and we agree, that the lottery ought to pull the old tickets. Not to do so rigs the game too much in the house's favor.
It is possible the lottery could lose some money it anticipates winning from players if, through bad luck, the top prizes go rather quickly and the game goes bust.
But, it's all a gamble. Players shouldn't be the only ones taking a risk -- not when the alternative amounts to false advertising.
