Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: THURSDAY, March 12, 1992 TAG: 9203120230
SECTION: VIRGINIA PAGE: B3 EDITION: NEW RIVER VALLEY
SOURCE: STEVE SUO LANDMARK NEWS SERVICE
DATELINE: MELBOURNE, AUSTRALIA LENGTH: Medium
"We have to take every possible step to create a logistical process that is flawless," Mandel said in a promotional videotape obtained by The Virginian-Pilot and The Ledger-Star. "There is absolutely no margin for error.
"If someone wanted to copy us, it would take five years minimum - providing they were as smart as we are," Mandel said in the tape produced for the International Lotto Fund.
The fund, an Australian-based syndicate, won Virginia's $27 million jackpot Feb. 15. It apparently used a powerful laser printer to mark millions of play slips and employed dozens of well-trained agents to buy lottery tickets.
The videotape, which sources believe was produced last summer, provides the most detailed portrait yet of how the International Lotto Fund gears up to play all possible number combinations in a lottery.
An Australian company printed millions of copies of play slips used to play lotteries in the United States and other countries. The play slips were filled out by a computer laser printer and analyzed by computer programs and an accounting firm for accuracy. Then as each targeted drawing approached, the slips would be shipped abroad from Melbourne to couriers standing ready to deliver them to retailers.
The International Lotto Fund had 37 agents in one U.S. state and 60 in another ready to help purchase tickets, Mandel said.
Yet Mandel, in a news conference Wednesday, tried to distance himself from the Virginia lottery win - despite confirming to an Australian television news program two days earlier that he was the brains behind the scheme.
"My role is a consultant," he told reporters. "I produced the system, I'm the originator of the [International Lotto Fund], but I wasn't involved in the draw."
He said that he personally made no money from the Virginia lottery win, despite Australian reports that he made $3 million (Australian) from selling shares to investors.
However, Mandel confirmed that his wife, Kathleen, holds shares in the fund. And he said one of his companies, Bramad Pty. Ltd., received commissions from life insurance companies for selling policies to International Lotto Fund investors.
Another Mandel company, Pacific Financial Resources, oversaw the purchase of several million tickets in Norfolk, according to company employees Robert Hans Roos of Australia, and Anithalee Alex, who lives in Illinois.
Mandel told prospective investors last May that they could expect to double their money soon, according to a source who attended one of Mandel's promotional seminars.
The International Lotto Fund planned to enter about six lotteries a year, he said, on jackpots ranging from $22.5 million (U.S.) to $37.5 million.
The money came from investors who each laid down a premium of $4,680 (U.S.) for a life insurance policy. On each sale, Mandel took $3,000, keeping $1,500 for administrative costs and depositing $1,500 in the fund in the investor's name. The remainder went toward the policy.
In the video, Mandel said the laser printer was programmed to mark numbered boxes on the play slips with a slightly crooked line. The result: The slips looked like they'd been filled out by hand.
"If you're the biggest computer hacker, you couldn't tell the difference," Mandel said in the video. The technique was used "just for a bit more security and confidentiality."
When asked at the news conference why, in an earlier interview, he had called the Virginia scheme a bad gamble, Mandel replied: "I said if I had $7 million personally I would not have invested it. There's 2,500 people and you take a punt. . . . I was referring to what I would have done with $7 million in cash if I had it."
by CNB