After Robert Rhodes collected a Wisconsin Lottery jackpot that had been rigged by his friend, he used the windfall for an investment scheme that produced another wave of undeserved government money, court records show.
Rhodes, an accomplice in a scandal that has shaken U.S. state lotteries, recently explained under oath how he used the $783,000 payout to receive an additional $180,000 in bogus tax refunds. The Texas businessman sent his lottery winnings offshore to buy a phoney insurance policy for a personal corporation that never did any business — except receive the lottery prize. He then claimed the policy as a tax-deductible "business expense."
The upshot: Rhodes received roughly $150,000 from the U.S. government and $36,200 from Wisconsin in tax refunds on the lottery payout.
To get that payout, Rhodes' friend, Eddie Tipton, former security director for the Multi-State Lottery Association, resorted to rigging the Dec. 29, 2007, Megabucks lottery. The draw was advertised at $2 million.
Tipton, 54, admitted in court that he also provided cohorts with the winning numbers for jackpots in Colorado in 2005, Kansas in December of 2010 and Oklahoma in 2011.
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