How to hack the lottery

at 10:17 AM ET, 08/24/2011


(LINDA DAVIDSON/THE WASHINGTON POST)
In the past few years, it seems like hacking the lottery has become the hot new craze. In 2003, Mohan Srivastava, a statistician in Toronto, managed to unearth patterns in the Ontario Lottery scratch cards and predict which ones were winners. (Rather than cash in, he alerted lottery officials by mailing them two piles of unscratched cards labeled winners and losers—he got 19 of 20 right.) Here at home, a Stanford statistics PhD named Joan Ginther has managed to win the Texas lottery four times since 1993, taking in $21 million—and, in Harpers, Nathaniel Rich laid out evidence suggesting that she might not have been lucky, but exploited patterns in the cards.

But aren’t these games supposed to be truly random? How is it possible for anyone to hack them? New Scientist recently chatted with Srivastava, who had met with Ontario Lottery executives, and broke it down. Most lotteries, obviously, want to turn a profit—especially if they’re supposed to provide a relatively stable source of revenue for the government. And that means they want to control how many people win, which in turn means they typically don’t rely on truly random mechanisms like grabbing a ball from a tumbler. Instead, they’ll use pseudo-random number generators and the like, which means that lotteries can always be exploited by particularly adroit statisticians.

But even truly random lotteries can sometimes get snagged. The numbers on the tickets for the Massachusetts Cash WinFall, for instance, are totally random. But, as the Boston Globe discovered, Marjorie and Gerald Selbee appear to have discovered a different loophole in the game. If no one wins the lottery’s big $2 million prize, then, after a few weeks, payouts for smaller prizes start rising automatically. And, at that point, anyone who buys gobs and gobs of tickets—at least $100,000 worth—is assured a profit.

By the way, that doesn’t mean this is a viable get-rich-quick scheme. As Adam Ozimek recently noted, one 2010 survey on financial literacy found that “21 percent of individuals surveyed—including 38 percent of those with income below $25,000—reported that winning the lottery was ‘the most practical strategy for accumulating several hundred thousand dollars’ of wealth for their own retirement.” Needless to say, they’re probably not all statistics PhDs who have finally cracked the Powerball code.

 
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