Games where players select a small group of
numbers (usually 6) from a large set (usually 49) and are
awarded prizes based on how many match the randomly drawn
result. In a typical lotto game, a player might be asked to
select six numbers from a set of 49. At a predetermined time,
the lottery people randomly draw six numbers. The player wins
a major prize if all six of their numbers match those chosen
in the random drawing.
Lotteries come in many formats. The prize can
be fixed cash or goods. In this format there is risk to the
organizer if insufficient tickets are sold. The prize can
be a fixed percentage of the receipts. A popular form of this
is the "50-50" draw where the organizers promise
that the prize will be 50% of the revenue. The prize may be
guaranteed to be unique where each ticket sold has a unique
number. Many recent lotteries allow purchasers to select the
numbers on the lottery ticket resulting in the possibility
of multiple winners.
Chances of winning a Lottery Games
The probability of winning a lottery jackpot
are principally determined by several factors: the count of
possible numbers, the count of winning numbers drawn, whether
or not order is significant and whether drawn numbers are
returned for the possibility of further drawing.
In a typical 6 from 49 lotto, 6 numbers are
drawn from 49 and if the 6 numbers on a ticket match the numbers
drawn, the ticket holder is a jackpot winner - this is true
regardless of the order in which the numbers are drawn. The
odds of being a jackpot winner are approximately 1 in 14 million
(13,983,816 to be exact). The derivation of this result is
a simple exercise in combinatory.
To put these odds in context, suppose one buys
one lottery ticket per week. 13,983,816 weeks is roughly 269,000
years; in the quarter-million years of play, one would only
expect to win the jackpot once.
Payment of prizes in Lottery Games
The payment of a lotto prizes is not always
a lump sum amount. In countries like USA the winner gets to
choose from either an annuity payment or a one-time payment.
The one time payment is often about half of the advertised
lotto jackpot, with much of the prize subject to a withholding
tax. The annuity payment makes regular payments for periods
from 10 to 40 years.
In some online lotto’s the yearly payments can
be as low as $25,000 for 40 years with a balloon payment on
the final year. In some countries lottery winnings are not
subject to personal income tax, thus there are no tax consequences
in terms of how the prize is paid out.
Scams and Frauds in Lottery Games
Lottery like any mechanism is susceptible
to fraud despite the high degree to scrutiny offered by the
organizers. One method involved is to tamper the machine used
for the number selection. By rigging a machine it is theoretically
easy to win a lottery. Some scams on the Internet too are
based on lotteries. The modus operandi of this fraud is the
trickster sends Spam to all email users in their database
congratulating them on their recent lottery win. Then they
proceed to announce that in order to release funds they must
part with a certain amount (as tax/fees) as per the rules
or risk forfeiture. The scammers also might use telephone
or printed letters to approach victims to execute their plan