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Michigan lottery cracks down on rule-breaking vendors

November 17, 2017

DETROIT (AP) — The Michigan Lottery is working to catch retailers who break the rules.

Records show that almost 270 of the state’s nearly 11,000 lottery retailers have had their licenses suspended or revoked since 2016.

Most of the suspensions are the result of retailers getting behind on ticket sales payments to the Michigan Lottery, the Detroit Free Press reported .

Officials said one major concern is a practice known as “discounting” — where retailers purchase winning tickets at a cheaper price from people who want to prevent the state from seizing the prize money in order to pay off debts.

Few suspensions are the result of cheating, said Jeff Holyfield, a lottery spokesman. Retailers receive a 6 percent commission on ticket sales, which is a strong incentive to keep licenses in good standing.

“Our retailers ... really are focused, just as we are, on keeping customers happy,” he said.

Preliminary numbers indicate that vendors received $248 million for the fiscal year that ended Sept. 30. Retailers are also awarded a 2 percent commission on prizes they redeem.

Nick’s Party Stop in Clinton Township had its license suspended and was placed on probation after an investigation found that retailer Don Kallo falsely declared a winning ticket as a loser and tore the ticket in half, according to lottery records. Kallo then attempted to redeem the winning ticket.

“This truly is an aberration,” Holyfield said.

Officials said that while such cases are rare, the lottery takes them seriously, because problematic vendors erode player trust, which is essential to the lottery’s success.


Information from: Detroit Free Press, http://www.freep.com

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