California Lottery SECURITYLAW ENFORCEMENT DIVISION

1
California LotterySECURITY/LAW ENFORCEMENT
DIVISION
2
RESPONSE

• Consumer Protection Strategic Plan
• Retailer and retailer related claim analysis
  which
  
• includes
• Revised claim form
• Claims Player Services collaboration
• Field investigations
• Large prize query alert
• Check A-Ticket for instant tickets
• Mystery Shopper Program
• Retailer Redemption Compliance Program

3
RIP ANALYSIS

• 30 retailers - 70 clerks
• Female operator 4 times more likely to be ripped
• With media further rips decline, however,
  retailer complaints double
  
• More likely to pay nothing rather than underpay
• Most claims submitted within 30 days of rip
• Day of week/time of day not a factor
• Independent stores more likely than corporate
  stores
  
• Random vs target stores irrelevant
• Region of state irrelevant however, urban vs
  rural a factor
  

4
ACTION

• Recognize insider fraud is occurring in places
  other than Ontario and California
  
• Educate and empower the consumer
• Extract the retailer/clerk from the sale and
  redemption process
  
• Analyze your claims
• Initiate a compliance program if not criminal
  oriented then administrative
  

5
IOWA LOTTERY STINGS

• Lottery finds 50 of retailers not getting
  signatures
  
• Thursday, March 12, 2009, 502 PM
• By Darwin Danielson
• The Iowa Lottery says retailers passed the test
  when it comes to paying out the proper amounts in
  prizes, but only half
  
• passed the test when it comes to doing the
  paperwork. Iowa Lottery spokesperson Mary
  Neubauer says lottery fraud in
  
• Canada and California prompted them to make
  unannounced security checks to retailers across
  the state.
  
• Neubauer says there doesn't appear to be any
  problems in Iowa, but they felt they should do
  checks to be sure.
  
• Lottery security officials posing as customers
  check 126 retailers last month. She says the
  security officials presented
  
• retailers with a winning tickets that ranged up
  to 100.
  
• Neubauer says in every instance the retailers
  paid the exact amount the person should have been
  paid. The lottery last year
  
• began requiring a signature for someone to check
  if a ticket is a winner or to cash in a winning
  ticket. Neubauer says the
  
• retailer compliance for that requirement was not
  good. She says about half the locations did not
  require a signature and so
  
• the Iowa Lottery will go back to those locations
  and explain why the signature is a requirement
  and why they are doing it.
  
• Neubauer says they hope to get retailers to
  comply with the signature requirement before
  taking any action against them.
  
• Neubauer says they do have a process where
  retailers can be given a warning and if there are
  repeated violations, they can
  
• suspend the retailers license. She says they
  believe they can take care of the situation with
  some retraining.