LOTTERY

Loto-Quebec promotional photoshoot.

The first lottery in Canada was Quebec's Inter-Loto in 1970. Other provinces and regions introduced their own lotteries through the 1970s, and the federal government ran Loto Canada (originally the Olympic Lottery) for several years starting in the late 1970s to help recoup the expenses of the 1976 Summer Olympics. Lottery wins are generally not subject to Canadian tax, but may be taxable in other jurisdictions, depending on the residency of the winner.[3]

Today, Canada has two nation-wide lotteries: Lotto 6/49 (which started in 1982), and Lotto Super 7 (which started in 1994). These games are administered by the Interprovincial Lottery Corporation, which is a consortium of the five regional lottery commissions, all of which are owned by their respective provincial and territorial governments:

• Atlantic Lottery Corporation (New Brunswick, Nova Scotia, Prince Edward Island, Newfoundland and Labrador)
• Loto-Québec (Quebec)
• Ontario Lottery and Gaming Corporation (Ontario)
• Western Canada Lottery Corporation (Manitoba, Saskatchewan, Alberta, Yukon Territory, Northwest Territories, Nunavut)
• British Columbia Lottery Corporation (British Columbia)

Lottery in France

The first known lottery in France was created by King Francis I in or around 1505. After that first attempt, lotteries were forbidden for two centuries.

They reappeared at the end of 17th century, as a "public lottery" for the Paris municipality (called Loterie de L'Hotel de Ville) and as "private" ones for religious orders (mostly for nuns in convents).

Lotteries became quickly one of the most important resources for religious congregations in the 18th century.

Lotteries helped to build or rebuild many churches (about 15 including the biggest ones) in Paris during the 18th century, including St Sulpice and Le Panthéon.

At the beginning of the century, the King avoided having to fund religious orders by giving them the right to run lotteries, but the amounts generated became so large that the second part of the century turned into a struggle between the monarchy and the Church for control of the lotteries. In 1774, the Loterie de L'École Militaire was founded by the monarchy (by Mme de Pompadour to be precise, to buy what is called today the Champ de Mars in Paris, and build a Military Academy that Napoleon Bonaparte would later attend) and all other lotteries, with 3 or 4 minor exceptions, were forbidden.

This lottery became known a few years later as the Loterie Royale de France. Just before the French Revolution in 1789 the revenues from La Lotterie Royale de France were equivalent to between 5 and 7% of total French revenues.

Throughout the 18th century, philosophers like Voltaire as well as some bishops complained that lotteries exploit the poor. This subject has generated much oral and written debate over the morality of the lottery.

All lotteries (including state lotteries) were frowned upon by idealists of the French Revolution, who viewed them as a method used by the rich for cheating the poor out of their wages.

The Lottery reappeared in France in 1936, called loto, when socialists needed to increase state revenue. Since that time, La Française des Jeux (government owned) has had a monopoly on most of the games in France, including the lotteries.

Lottery in New Zealand

Lotteries in New Zealand are controlled by the New Zealand government. A state owned trading organisation, the New Zealand Lotteries Commission, operates low prize scratch ticket games and powerball type lotteries with weekly prize jackpots. Lottery profits are distributed by The New Zealand Lottery Grants Board's directly to charities and community organisations. Sport and Recreation New Zealand, Creative New Zealand, and the New Zealand Film Commission are statutory bodies that operate autonomously in distributing their allocations from the Lottery Grants Board.

The lotteries are drawn on Saturday and Wednesday. Lotto is sold via a network of computer terminals in shopping centers across the nation. The Lotto game was first played in 1987 and replaced New Zealand's original national lotteries, the Art Union and the Golden Kiwi. Lotto is a pick 6 from 40 numbers game. The odds of winning the first division prize of around NZ$300,000 to NZ$2 million are 1 in 3,838,380.

The Powerball game is the standard pick 6 from 40 lotto numbers with an additional pick 1 from 8 powerball number. This game has odds of 1 in 30,707,040 and a first prize of between NZ$1million and NZ$15million. Big Wednesday is a game played by picking 6 numbers from 49 plus heads or tails from a coin toss. A jackpot cash prize of NZ$1million to NZ$15 million is supplemented with product prizes such as Porsches, boats and holiday homes. The odds of winning first prize are 1 in 16,290,120. Results services for these games can be found at NZ Lotto Results.

Probability of winning

The chances 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 (and other winning scores) is shown in the Lottery Mathematics article.

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.

The odds of winning any actual lottery can vary widely depending on lottery design. "Powerball" is a very popular multistate lottery in the United States which is known for jackpots that grow very large from time to time. This attractive feature is made possible simply by designing the game to be extremely difficult to win: 1 chance in 146,107,962. That's over ten times smaller than the example above. Powerball players also pick six numbers, but two different "bags" are used. The first five numbers come from one bag that contains numbers from 1 to 55. The sixth number -- the "Powerball number" -- comes from the second bag, which contains numbers from 1 to 42. To win a powerball jackpot, a player's five regular numbers must match the five regular numbers drawn and the Powerball number must match the Powerball number drawn. In other words, it is not good enough to pick 10, 18, 25, 33, 42 / 7 when the drawing is 7, 10, 25, 33, 42 / 18. Even though the player picked all the right numbers, the Powerball number at the end of the ticket doesn't match the one drawn, so the ticket would be credited with matching only four numbers (10, 25, 33, 42).

Most lotteries give lesser prizes for matching just some of the winning numbers. The Powerball game described above is an extreme case, giving a very small payout (US$3) even if a player matches only the Powerball number at the end of your ticket. Matching more numbers, the payout goes up. Although none of these additional prizes affect the chances of winning the jackpot, they do improve the odds of winning something and therefore add a little to the value of the ticket.

The expected value of lottery bets is often notably bad. In the United States, an expected value of -50% is not atypical. This has led some people to deride lotteries as the aforementioned "math tax" or a "tax on stupidity."

Notable prizes

Sources: http://www.usamega.com/archive-052000.htm http://news.bbc.co.uk/1/hi/world/europe/4746057.stm http://news.bbc.co.uk/1/hi/uk/4676172.stm http://news.bbc.co.uk/1/hi/world/americas/4740982.stm

On 20 September 2005 a primary school boy in Italy won £27.6 million in the national lottery. Although children are not allowed to gamble under Italian law, children are allowed to play the lottery. [4]

Payment of prizes

Winnings are not necessarily paid out in a lump sum, contrary to the expectation of many lottery participants. In certain countries, such as the USA, the winner gets to choose between an annuity payment and a one-time payment. The one-time payment is much smaller, indeed often only half, of the advertised lottery jackpot, even before applying any withholding tax to which the prize may be subject. The annuity option provides regular payments over a period that may range from 10 to 40 years.

In some online lotteries, the annual payments can be as little as $25,000 over 40 years, with a balloon payment in the final year. This type of installment payment is often made through investment in government-backed securities. Online lotteries pay the winners through their insurance backup. However, many winners choose to take the lump-sum payment, since they believe they can get a better rate of return on their investment elsewhere.

In some countries, lottery winnings are not subject to personal income tax, so there are no tax consequences to consider in choosing a payment option. In Canada and Australia, all prizes are immediately paid out as one lump sum, tax-free to the winner.

Scams and frauds

Lottery is susceptible to fraud, despite the high degree of scrutiny offered by the organisers. One method involved is to tamper with the machine used for the number selection. By rigging a machine, it is theoretically easy to win a lottery. This act is often done in connivance with an employee of the lottery firm. Methods used vary; loaded balls where select balls are made to popup making it either lighter or heavier than the rest. Many other ingenious methods too have been employed.

Some scams on the internet are based on lotteries. The modus operandi of this fraud is that 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. Some unsuspecting users might fall prey to this scandal and part with their money falling into their trap, where they continue to pay as they are misled by the scamsters who dupe their clients into believing that they are always one step closer to the money. The swindlers also might use telephone or printed letters to approach victims to execute their plan more professionally.

Another form of lottery scam involves the selling of "systems" which purport to improve a player's chances of selecting the winning numbers in a Lotto game. These scams are generally based on the buyer's (and perhaps the seller's) misunderstanding of probability and random numbers.

See also

• Combinadic
• Factorial
• Gambling
• GTech Corporation
• Keno
• Luck
• Probability
• Probability theory

External links

• World Lottery Association
• Lotteries are another state tax - but with better marketing