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Twelve people and three stores in Boston, Chelsea and North Reading have been indicted in connection with an ongoing scheme to rob the state of Massachusetts of tax revenue by laundering lottery winnings and lying under oath on numerous lottery claim forms.Massachusetts Attorney General Maura Healey announced Tuesday that the following defendants were indicted by a statewide grand jury of the following charges:Frank Obey, 80, of Lynn, is facing two counts of false statement under penalty of perjury and one count each of conspiracy to evade taxes, attempting to impede/obstruct administration of state tax laws and money laundering.Kenneth Grossman, 69, of Revere, is facing one count each of conspiracy to evade taxes, attempting to impede/obstruct administration of state tax laws and money laundering.William McNamara, 67, of Revere, is facing one count each of false statement under penalty of perjury, conspiracy to evade taxes, attempting to impede/obstruct administration of state tax laws and money laundering.John Heller, 73, of Revere, is facing one count of conspiracy to evade taxes.Adam Derebala, 29, of Revere, is facing one count of failure to file a tax return.Peter Marano, 52, of Boston, is facing one count of tax evasion.Karl Voelker, 67, of Boston, is facing one count of conspiracy to evade taxes.Paritosh Patel, 48, of Reading, is facing one count of conspiracy to evade taxes.Nelson Tejada, 43, of Chelsea, is facing one count of conspiracy to evade taxes.MDGolam Talukder-Manik, 57, of Lynn is facing one count of conspiracy to evade taxes. The Underground Express at 31 Winter Place in Boston was charged with conspiracy to evade taxes. In-depth news coverage of the Greater Boston Area. Adam Derebala, 29, of Revere, was charged with failure to file a tax return. The state legislature first voted to legalize gambling, with the lottery being organized soon thereafter. Massachusetts law prohibits the unlawful assignment of winning lottery tickets. Spillane's office is actually in Hanover. The Massachusetts State Lottery was created in 1971 to generate local aid revenue for our 351 cities and towns through state-run games of chance. It is also alleged that the defendants reported the ticket winnings as their own on their income tax returns and improperly offset the claimed winnings with purported gambling losses, thereby avoiding federal income taxes. He has been identified as an employee of Grab N Go located at 367 Washington Avenue in Chelsea. But the roll-down didnt arrive two draws, or even three draws, later. As he studied the game, Harvey realized that it was easier to make money on WinFall than on other lotteries. The charges are the result of an investigation by members of the Massachusetts State Police assigned to Healey's office and the State Treasurer's Office of Investigations, as well as the MSP Gaming Enforcement Division and the Massachusetts State Lottery Commission. Some of them have become so dependably successful, in fact, that they even have investors and file tax returns. Then, Michigan closed down the game they were playing, and they focused on Massachusetts, where thestakes were higher. If you need assistance, please Contact the Attorney General's Office at (617) 727-2200. Assistant U.S. Attorney Sara Miron Bloom of Mendells Securities, Financial & Cyber Fraud Unit is prosecuting the case. Meeting details available here. You can play your numbers in up to 30 consecutive draws. Claim prizes between $601 - $5,000 securely & conveniently from the app. Despite the ongoing competition, some betting syndicates have managed to repeatedlyand legallyturn a profit. Meeting details available here. A Massachusetts woman who accidentally tossed out a $1 million lottery ticket eventually collected her winnings thanks to the kindness and honesty of the owners of the convenience store where. The Massachusetts Lottery shut down the game. Store owners and employees funneled winning tickets to Frank Obey, Kenneth Grossman and their runners. The attorney general's office said three businesses -- Underground Express on Winter Place in Boston, Richdale on Lowell Road in North Reading, and NT Lucky Variety on Arlington Street in Chelsea -- that sold Lottery products also face charges of conspiracy to evade taxes. He discovered a flaw in the system of the game and found that a positive return is possible if the number of tickets bought to bet is high enough. Home | Massachusetts Lottery MSLC meeting, Tuesday February 28. While most of the men are also charged with conspiracy to commit tax evasion, Frank Obey, 80, of Lynn; Kenneth Grossman, 69, of Revere; and William McNamara, 67, of Revere; face additional charges including perjury, attempting to impede/obstruct tax laws and money laundering. The DOR program is an automated process used to intercept and collect Massachusetts State Lottery Commission winning payouts, over $600, to satisfy delinquent debt. (MORE: When Good Things Happen to Good People: 8 Heartwarming Lottery Wins). A promo shot from Lucky Numbers, the movie adaptation of the Triple Six Fix lottery scandal. Other syndicates got in on the action, too. Are They Still Together. This page is located more than 3 levels deep within a topic. When the estimated jackpot reached $2 million, players knew that the money would roll-down if nobody matched six numbers. In some cases, the true winner might be attempting to evade past-due child support payments, taxes or other debts which the Lottery is legally obligated to help collect, officials have said, or the claims may be part of a money laundering scheme. A spokesperson for Healeys office declined to say how much money was involved. The information was a boost for the MIT group, which until then had been relying on their own calculations. Here's the process for claiming Massachusetts Lottery prizes. (Employee of Grab N Go located at 367 Washington Ave in Chelsea, The ten-percenting scheme is designed to defeat government collection of back taxes through the Department of Revenue (. This arrangement allows the true winners to avoid financial obligations, including state and federal taxes, officials said. Spillane has been to the Massachusetts Lottery headquarters 41 times to claim a winning ticket. Stay up to date with everything Boston. Jerry and Marge played their last Cash WinFall game in January 2012 as well. The only real obstacle is buying enough tickets. (1) The Mass Lottery office in Woburn is closing at noon Friday. The defendants will be arraigned on the charges they face at a later date in Suffolk Superior Court. Father, sons face federal charges in $21M Massachusetts state lottery scam. They calculated that a player who used stores automated lottery machines, which churned out tickets with arbitrary numbers, would be able to place 100 bets per minute. The defendants will be arraigned in Suffolk Superior Court at a later date. Use of and/or registration on any portion of this site constitutes acceptance of our User Agreement, Privacy Policy and Cookie Statement, and Your Privacy Choices and Rights (each updated 1/26/2023). Frank Obey, 80, of Lynn, and William McNamara, 67, of Revere, were charged with false statements under penalty of perjury, conspiracy to evade taxes, attempting to impede or obstruct the administration of Massachusetts tax laws and money laundering. The arrangement allows for the true lottery winners to avoid financial obligations, including state and federal taxes. EYTH PURCHASED WINNING TICKETS FR AOMCTUAL WINNERS AT A DISCOUNTED VALUE. Ghanshyam Patel, 45, of Malden, is facing one count of conspiracy to evade taxes. Adam Derebala, 29, of Revere, and Peter Marano, 52, of Boston, are charged with failure to file a tax return and tax evasion, respectively, in connection with them having someone else claim their Lottery winnings. It's all in this six-part documentary series that details the true story of how $24 million was stolen from the McDonald's Monopoly game during the 1990s, the mystery mastermind behind the scam and the intrepid FBI agents on his trail. Betting success is not just limited by competition, however. "Between on or about March 23, 2020 and on or about June 12, 2020, the Defendants together claimed approximately $360,807 in Massachusetts lottery winnings by submitted the claims through the. The MSLCs Compliance and Internal Audit Department focuses on the prevention, detection, and the investigation of those who defraud or attempt to defraud the lawful ticket-claiming process. Players also can purchase the Doubler option, which doubles any winnings aside from the jackpot. Are They Still Together? This investigation also identified Frank Obey, Kenneth Grossman and William McNamara as individuals who were using the Massachusetts State Lottery to launder money. Richdale at 4 Lowell Road in North Reading was charged with conspiracy to evade taxes. They'd been vilified in the media, Jerry Selbeefelt, even after he'd sat for interviews himself with the Globe reporter. Twelve indicted in statewide lottery laundering, Click to share on Facebook (Opens in new window), Click to share on Twitter (Opens in new window), Click to share on Reddit (Opens in new window), Substantial snowfall likely for parts of Massachusetts, as meteorologists track wintry mix, Twelve indicted in statewide lottery laundering scheme, Prosecution wraps its case at Alex Murdaugh murder trial, Death toll keeps rising in Greeces deadliest train crash, Cops say man sprayed MBTA passenger with unknown liquid, Passenger in 2021 Green Line collision sues MBTA for $44K. When WinFall was introduced, lottery officials had looked into the possibility of somebody deliberately nudging the draw into a roll-down by buying up a large number of tickets. Statistics, Test numbers, Random Generator. By 2005, the group had earned almost $8 million with its system, according to an investigationbythe Boston Globe. Powered by WordPress.com VIP. Using his mathematical abilities, Jerry finds a way to ensure profits while buying an enormous number of WinFall tickets. Please let us know how we can improve this page. Massachusetts scratch tickets. Two true winners, Peter Marano and Adam Derebala, were identified and stand charged respectively for tax evasion and failing to file a tax return. All of these charges are allegations, and the defendants are presumed innocent until proven guilty. "How do I become a member of the [Selbees'] club when I retire?" The scheme allows the true winners to avoid financial obligations, including state and federal taxes. A recent report by the states inspector general reveals more details about the scheme, including the fact that the Massachusetts Lottery knew of the students ploy and for years did nothing to stop it. The Massachusetts State Lottery aided in this investigation, by working with investigators in the AGs Office to identify claims of the alleged perpetrators of this scheme. Marge Selbee, Jerrys wife, accompanies him in the new endeavor. While the students actions are not illegal, state treasurer Steven Grossman, who oversees the lottery, finally stopped the game this year. The charge of conspiracy to defraud the Internal Revenue Service provides for a sentence of up to five years in prison, three years of supervised release, a fine of$250,000 or twice the gross gain or loss, whichever is greater, and restitution. When Selbees syndicate heard about WinFall, they turned their attention to Massachusetts. In May 2020, prosecutors say Lamb won $10,000 on a Massachusetts State Lottery Commission scratch ticket, which he then sold to a convenience store owner for $7,500 in cash. Directed by David Frankel, Paramount+s comedy film Jerry & Marge Go Large follows Jerry Selbee, who discovers a flaw in the system of a lottery game titled WinFall. Ten years ago, students and a professor were involved in a massive card-counting scandal in Las Vegas casinos. Sentences are imposed by a federal district court judge based upon the U.S. The couple played Cash WinFall for six years, seven plays per year. He wanted to get hold of a copy of the guidelines for the game, which would outline precisely how the prize money was distributed. 1998 - 2023 Nexstar Media Inc. | All Rights Reserved. Here are the 12 individuals charged, according to Healeys office: (Employee of Richland Convenience Store located at 332 Nahant Road in Nahant), (Employee of Robinsons News Convenience Store located at 1556 Eastern Avenue in Malden), (Employee of Grab N Go located at 367 Washington Ave in Chelsea), Stay up to date on all the latest news from Boston.com. After cashing in 13,000 Massachusetts lottery tickets, father and sons now accused of $21 million fraud, Statistically improbable: Massachusetts father and sons accused of $21 million lottery fraud were on authorities radars before federal charges. Learn all about Mega Millions Obey, Grossman, and William McNamara allegedly used the lottery to launder money, prosecutors said. July 2 (UPI) --A Massachusetts man said a snap decision to buy a scratch-off lottery ticket from a convenience store led to his winning his second $1 million jackpot in four years.Stephen Toto of . Still, he seemed to think, it was a small price to pay--and well worth the cost. MDGolam Talukder-Manik, 57, of Lynn is facing one count of conspiracy to evade taxes. Over the next few years, playing the lottery became a full-time job for Harvey. Another group was led by Gerald Selbee, a retired shop owner and former math student who had previously had success with a similar game elsewhere. This article has been adapted from Adam Kucharski's book, The Perfect Bet: How Science and Math Are Taking the Luck Out of Gambling. But in 2008, the lottery finally sent him the guidelines. Download Claim Form The Season Ticket option offers you two possible subscriptions: 3 months, or 6 months. The Selbees took on investors, and thenfaced another challenge: a group of students from MIT who had also figured out the odds, formed an organization, attracted investors, and started making millions. Ali Jaafar, 63, and his two sons Mohamed Jaafar, 31, and Yousef Jaafa, 28, were charged on August 23 with over 12 counts of fraud, money laundering, and tax evasion in what officials reportedly dubbed a "ticket cashing scheme." James Harvey was nearing the completion of his mathematics degree and needed a project for his final semester. After first few hundred thousand dollars in profit, the Selbeesstarted a company to fund and organize the whole thing. It has been called Dr. Seuss Day because of this. Steven Grossman, the then-state treasurer, had to announce that the game will get phased out within a year. Stephen Toto displays his check after winning the Massachusetts lottery a second time. A grand jury has indicted a dozen people and three stores in Boston, North Reading, and Chelsea in connection with a scheme to launder money and avoid taxes on lottery winnings. Besides, they're back in Michigan now--hundreds of miles away from the Massachusetts media. In November 2022, the Massachusetts Lottery sold about $58.6 million in Powerball tickets, reflecting $48.9 million more than November 2021, or a roughly sixfold increase. Share sensitive information only on official, secure websites. Please limit your input to 500 characters. They come in multiple price points: $1, $2, $5, $10, $20 and even $30. It didn't matter, as the Selbees would later argue, that theirout-of-state money was pumping millions of dollars into the Massachusetts lottery's coffers--and was ultimately distributed to the state's cities, towns, and schools. Instead of taking $25,000 a year, he decided to cash out a one-time . So that's what the Selbees started doing, to the point that playing the lottery became a full-time job at times. When nobody won the jackpot until the jackpot money reached $5 million, the prize money got rolled down to the lesser prizes in the absence of a jackpot winner in the next play. The problem with rollovers is that winnerswho are good publicity for a lotterycan be rare. Six correct guesses won you the jackpot, guaranteed to be at least $2 million and often higher. Jackpot $145 Million Cash value: $74.3 Million 1 day 19 hours 55 mins Latest Numbers See More Numbers MA Mega Millions Quick Picks 11 32 57 58 62 18 Copy Mega Millions Hub Click here for more Mega Millions info. Both are alleged to have circumvented the legal ticket-claiming process.The "ten-percenting" scheme is designed to defeat government collection of back taxes through the Department of Revenue Intercept Program, which is an automated process used to intercept and collect Massachusetts State Lottery Commission winning payouts over $600 to satisfy delinquent debt. Amy Sokolow is a general assignment and statehouse reporter for The Boston Herald, a position she started in June 2021. The Lottery reserves the right to disqualify entries that, to a reasonable person: (a) are sexually explicit, unnecessarily violent or derogatory of any ethnic, racial, gender, religious, professional or age group; (b) are obscene or offensive, or may create public disrepute, contempt, scandal or ridicule; (c) defame or invade publicity rights or privacy of any person, living or deceased, or . Spillane & # x27 ; s office is actually in Hanover numbers in up to 30 consecutive draws in.! 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