Auditors in Michigan, USA, are calling for a clampdown on lottery retailers who purchase winning tickets from players, at a discounted price, and claim the prizes for themselves.
The practice is illegal according to state laws, but many retailers are still happy to take advantage of players who dare not claim their prizes because they owe back taxes or have other debts they do not wish to pay.
A recent audit reveals 37 store owners cashed nearly $3.6 million worth of tickets in 2012 and 2013. One retailer alone collected 107 prizes last year that had a combined value of $346,312.
Auditors also discovered six of the offending store owners had failed to report $509,211 in winnings when they filed their tax forms in 2012.
The Auditor General said: "We recommend that the Lottery Bureau sufficiently identify and investigate lottery retail owners who repurchased winning lottery tickets—likely at a discount."
The Michigan State Lottery responded to the auditor's findings by pointing out there are over 11,000 retailers selling lottery games and stressed the practice of "discounting" is also an issue in many other states.
Nonetheless, the lottery has stated its intention to police retailers more aggressively in the future and instigate an investigation of any retailers that turn in more than 20 tickets per year that are worth over $20,000. As a further counter measure against discounting winners will also be asked to reveal how they obtained their tickets.
The Michigan Lottery stated 13 retailers have been disciplined as a result of the audit.