AUSTIN (KXAN) — Major changes are coming to the way millions of Texans play the lottery in our state. On Monday, the Texas Lottery Commission (TLC) announced it will ban lottery courier services, which allow people to order tickets online or through an app.
The decision came after pressure from state lawmakers who have concerns about potential money laundering and underage players buying tickets.
The issue received Governor Greg Abbott’s attention as well. He announced the Texas Rangers will investigate recent jackpot wins.
While the ban is a welcomed move by some, lawmakers wanted to try and understand why the commission didn’t do this sooner.
‘What changed?’
There were hours of heated discussion at the Senate State Affairs Committee hearing on Monday. The announcement came just hours before members of the commission provided testimony to the House Appropriations Committee and the Senate State Affairs Committee to discuss legislation from Sen. Bob Hall that would create criminal offenses for anyone facilitating or playing the lottery through the internet or on a mobile phone.
Senators repeatedly asked why the Texas Lottery Commission did not ban courier services before.
“You have consistently said you don’t have the authority to do anything about the couriers. you did it under oath last Wednesday at the finance committee hearing,” Sen. Hall said. “What changed?”
The commission said part of that decision came because of an $83 million jackpot winning ticket last week at a retailer owned by the courier Jackpocket. It owns and operates Austin-based retail store Winners Corner.
Despite being located in an area with little foot traffic, they generated the most lottery ticket sales in 2023. International Game Technology (IGT), the lottery operator in Texas, told senators the store had 47 machines, which is the most delivered to any one location. A typical convenience store only has one.
“It wasn’t 47 at once. They grew their business and the growing sales required the terminals,” said IGT Senior Director Joseph Lapinski. “The lottery licenses these retailers and indicates to us that it is appropriate, and in fact, directs us to install terminals, provide the necessary supplies and equipment for these retailers to sell.”
Gov. Abbott announced the agency opened an investigation into that lottery win, as well as another $95 million jackpot win from April 2023. In that situation, a single entity bought almost every single combination of tickets.
“This is probably the great, biggest fraud perpetrated on the state of Texas by any group ever.”
State Sen. Paul Bettencourt | (R) Houston
The commission dropped a bombshell in the hearing that there was a second attempt to do this.
“My understanding is that that group, or someone substantially affiliated with that group, was planning and preparing to buy a substantial number of tickets in December 2024,” said TLC Executive Director Ryan Mindell.
Mindell said as soon as he found out, he instructed IGT to initiate an “emergency code release.” He said he also briefed many of the members of the Sunset Advisory Commission and State Affairs Committee.
“I was in the capital for a significant amount of time on that day in December,” Mindell said.
Now, as there’s momentum to change and prevent these situations again, lawmakers asked how the commission plans to restore public confidence in the Texas Lottery.
“I think it’s going to be a long road,” Mindell said. “We have to make sure that we show the public that we’re taking these actions to restore that public trust.”
As an initial step with the new policy, no retailer will be allowed to have more than five machines. The commission said every terminal is registered on a system they can access and that’s part of how they exercise oversight.
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