Bungled SC lottery potential $20M payout to 'winners' likely illegal

- South Carolina Education Lottery officials are debating paying out nearly $20 million after a Christmas day glitch with one of its games had many players thinking they were winners. But that payout could be illegal, a FOX 46 investigation discovered.

Commercials promote playing their games "responsibly." But what about running the games responsibly? 

RELATED: South Carolina lottery officials set aside $20M for payout after glitch

Tony Berry says he won $29,000 from  playing the Holiday Cash Add-A-Play game during a two hour glitch where everyone who played came out a winner every game. The odds of winning the $500 prize are normally about one in 5000. 

Berry bought $80 worth of tickets after he realized something was up.

"Did you think at any point that this isn't right?," asked FOX 46 investigative reporter Matt Grant.

"Yes I did," said Berry, outside the Columbia, SC, headquarters. "But it's not my fault."

RELATED: Computer system error causes SC lottery ticket issues on Christmas

Lottery officials blame the snafu on a "programming error" from their computer system vendor. The lottery commission now has to decide if folks like Berry, who admit gaming the system, should still be paid.

FOX 46 obtained an email sent, from lottery officials to retail store owners, showing their investigation is looking at "all transaction history" including "detailed store-level terminal transactions."

In a brief statement Friday officials said the lottery commission set aside $19.6 million for the "potential validation of claims." But FOX 46 discovered last week that would likely be illegal because, under South Carolina law, pries "must not be paid" if the ticket is "produced or issued in error."

"You guys did an outstanding job of raising this issue," said Charlotte consumer attorney Walter Bowers.

We showed him the statute and he says the wording is "clear" and "speaks for itself."

"If they were to pay out the claim," he said, "that would be a violation of the statute."

It is a no-win situation. If South Carolina Education lottery officials pay out the millions to players who "won," they would likely be breaking the law. If they don't, they could have a lot of angry players to deal with

Bowers says lottery officials could seek help from the legislature. 

FOX 46 asked South Carolina Education lottery officials for a response. We want to know:

  1. How a nearly $20 million payout can be legally justified?
  2. Where the extra money will come from?
  3. Could the money go towards education instead?
  4. Lottery officials confirm the game was changed in July. Why did that happen, what did the changes do and did those changes in any way contribute to the mishap?

Lottery spokesperson Holli Armstrong refused to comment. Instead she said  "our statement released Friday is our only response."

That statement, Armstrong released Friday, reads, in full:

The following motion was adopted [by the lottery commission]: To set aside 19.6 million dollars that equates to the potential amount represented by the tickets displaying nine Christmas trees in the Holiday Cash Add-A-Play game and direct staff to continue its legal research and investigation, including seeking further cooperation from Intralot and the potential validation of claims.

Bowers says lotto officials should be more transparent.

"I do find it somewhat troubling," said Bowers, "[that] they're not willing to answer those questions at this time."

The lottery commission will meet later this month to make a final decision.

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