In the 1980s and 1990s, Stefan Mandel turned playing the lottery into an art form. The Romanian-Australian economist managed to win the lottery an astounding 14 times. Everything he did was perfectly legal and all it took was some simple calculations.
Mandel was born in Romania, a Communist country, and his initial incentive was to find a way to move his family out of the country. Winning the lottery was an obvious solution, but he had to figure out a way to beat the odds. So he formed a syndicate of investors to put money in to purchase vast amounts of lottery tickets and, if successful, to split the winnings. And, hey presto, they won and this first win allowed him to move his family to Australia.
While living there, he refined his strategy. First, he looked at different lotteries to see how many different combinations were needed to cover every possible draw. Mandel discovered that sometimes purchasing enough tickets to cover every combination cost less than the potential jackpot. For instance, if the jackpot was $10 million and, say, the 3 million tickets required only cost $1 each, he could buy all the tickets and guarantee a win, and a $7 million profit. All he needed to do was raise enough capital to buy all the tickets.
While in Australia, he won several jackpots and established larger and larger syndicates to beat the system - all while staying within the rules and regulations of the game. At the time, it was legal to print tickets at home, which allowed Mandel to purchase millions of tickets and automate a way to fill in the different combinations.
After big wins Down Under, lottery rules were adjusted to prevent bulk ticket purchases and the use of computer-generated tickets was banned. That spelt the end of Mandel's winning streak in his new home country, so he set his sights elsewhere and began scouting the American lottery operators. He eventually selected Virginia as his target because it had relatively few winning number combinations.
Mandel set up another syndicate and thousands of investors poured millions into the fund. He hired 16 employees who spent three months printing the 1,411,811 tickets necessary to guarantee a win by covering all 7,059,052 combinations.
In 1992 the Virginia prize reached $27 million, so Mandel decided it was time to deploy his strategy. The syndicate ended up winning the jackpot, along with $900,000 in secondary prizes. Perhaps unsurprisingly, both the CIA and the FBI thought something nefarious had occurred and investigated Mandel. However, everything was cleared up in Mandel's favor. Also unsurprisingly, lottery authorities changed their rules to block his system for ever working again.
Mandel ended up pocketing millions. Today, he leads a quiet life in the South Pacific on the island of Vanuatu.
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