More money, more problems?
Federal authorities in New York said Tuesday that a winner of a $1.53 billion Mega Millions jackpot drawing in 2018 was one of several victims in a massive fraud orchestrated by a man hired to be a financial adviser.
The U.S. Attorney’s Office for the Eastern District of New York said in a presser that a self-dubbed “lottery lawyer” and several other co-defendants defrauded the anonymous South Carolina lottery winner out of tens of millions of dollars. The $1.53 billion Mega Millions jackpot was just shy of the $1.58 billion Powerball jackpot record set in 2016, but that ticket was split between winners in three states. The record-setting Mega Millions had just a single winning ticket and remains the largest of its kind in history.
The winner elected to go with the cash option of more than $877 million.
According to the government, attorney Jason Kurland of New York and three others were charged with wire fraud, wire fraud conspiracy, money laundering, and money laundering conspiracy in connection with a scheme to defraud Kurland’s lottery clients that “resulted in $107 million in losses.”
The winner of the $1.5 billion Mega Millions drawing, which was claimed in March 2019, was allegedly defrauded along with a winner of a $245 million Powerball drawing and another $150 million multi-state jackpot winner. The alleged victims weren’t named in the indictment.
It’s unclear who, if anyone, advised the South Carolina winner to take the cash option.
“Lottery winners can’t believe their luck when they win millions of dollars, and the men we arrested this morning allegedly used that euphoric feeling to their advantage,” FBI Assistant Director-in-Charge Will Sweeney said a statement. “The FBI New York discovered how these victims were persuaded to put large chunks of their cash into investments that benefited the defendants. Rather than try their luck at the lottery, these men resorted to defrauding the victims to get rich, but their gamble didn’t pay off.”
How the alleged scheme worked
Authorities said that the three aforementioned lottery victims each paid Kurland and his law firm hundreds of thousands of dollars, partly in exchange for investing advice.
The feds said that Kurland advertised himself as a lawyer representing dozens of lottery winners throughout the country with total winnings of about $3 billion.
“After gaining their trust with primarily traditional investments, Kurland steered his clients to invest in various entities and business deals controlled and directed by [the co-defendants], and received kickbacks in return — which Kurland failed to disclose to his clients,” prosecutors said. “The defendants then used the money from the lottery victims’ investments to keep their scheme going and to enrich themselves.”
Some money was “funneled back to the lottery victims and falsely presented to them as ‘interest payments’ on their investments.” Meanwhile, millions of dollars were stolen to “support the defendants’ lavish lifestyles — private jets, expensive vacations, and luxury vehicles including two yachts.”
Authorities said that funds the defendants “actually invested in various entities and deals” were mostly lost.
The presser added that the government has “taken steps to recover funds stolen” from the alleged scheme.
The defendants could face years or decades in prison if found guilty.
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