‘Jane Doe’ jackpot payout undermines lottery integrity

When spending the public’s money, honesty isn’t the only part of the best policy.

Openness and transparency are just as important.

That’s why people in the 44 states and three other jurisdictions offering the Powerball lottery should doubt the wisdom of a law that lets the winner of the seventh-largest jackpot in U.S. history remain anonymous.

“Jane Doe,” described in court papers as a longtime New Hampshire resident and “engaged community member,” this month received a lump-sum payment of $264 million after taxes. The only identifying factor publicly revealed is that she lives in Merrimack, population 25,580. A judge ruled this week that she could take advantage of a New Hampshire law that allows lottery prizes to be paid to a trust, thus keeping the winner’s name secret.

Public identification of lottery winners is important for a couple of reasons:

One, it proves that real people win, underscoring the basic integrity of the game – not to mention giving the state the opportunity to trot out the latest winner and possibly goose sales for the next time around.

Second, the people paying the bills have an inherent right to know how their money is spent and who gets it. As state-run institutions, lotteries use public money to pay out the jackpots. Identifying the winner is the same as identifying which companies get big public works projects or as detailing the salaries of public employees, from city hall custodian to the president.

While buying lottery tickets is purely voluntary, it’s a tax nonetheless because the money all goes to the government. In the case of Powerball, the government keeps 44 percent for public expenditures such as school system or programs for the elderly. About half of the money is paid out for prizes – making the 90 percent or so paid out by casino slot machines seem downright lavish.

This is not to suggest something’s amiss with this particular lottery winner. Her trust announced gifts totaling $249,000 to charities and pledged to make more donations. Her court request to remain anonymous cited a half-dozen incidents from 1984 to 2017 in which lottery winners had been the victims of theft, scams, incessant requests for donations and even violence – including two murders.

The request said Jane Doe “wishes to continue (her community) work and (have) the freedom to walk into a grocery store or attend public events without being known or targeted as the winner of a half-billion dollars,” referring to the jackpot’s annuitized value. They also noted that every day’s delay in the ruling cost her about $14,000 in interest.

However, officials must recognize that state-sanctioned secrecy breeds suspicion.

Like slot machines and other casino offerings and promotions, lotteries depend on players’ trust that the games are essentially fair – that even though the odds are not in their favor, the numbers truly are drawn at random, winners will get the promised payouts, and each ticket has an equal chance of winning.

Lotteries have fallen victim to scams, from Pennsylvania’s 666 scandal involving weighted lotto balls in 1980 to the Powerball itself. Less than a year ago, Eddie Tipton, former computer information security director for the Multi-State Lottery Association, admitted that he had doctored the code, so he could predict the winning Powerball numbers on specific dates of the year. Using his scheme, associates won jackpots in Colorado in 2005, Wisconsin in 2007, Kansas in 2010 and Oklahoma in 2011.

Investigators unearthed the plot after the group tried to remain anonymous while filing for a $16.5 million Hot Lotto prize in Iowa in 2010. Iowa officials wouldn’t pay the jackpot because the state’s rules require the ticket owner to be identified publicly. Tipton was sentenced in August 2017 to 25 years in prison.

In a 2014 investigation, the Palm Beach (Fla.) Post used public records of lottery winners to expose how lottery winners often hire “ticket cashers” to avoid paying overdue taxes or child support or even to launder drug money. The report focused on people who cashed in multiple tickets – sometimes hundreds of them over a period of months – for $1,000 to $20,000 each.

“Any time the government is paying out money, the public needs to be able to hold them accountable for that payment,” Melissa Melewsky, media law counsel with the Pennsylvania NewsMedia Association, said in a phone interview. “They can’t do that if they don’t know who the money is being paid to.”