Tipton was first convicted in October 2015 of rigging a $14.3 million drawing of MUSL's lottery game Hot Lotto.
[5][6][7][8] A subsequent investigation into the trust and the discovery of surveillance footage from a convenience store that depicted the ticket being purchased, led to the arrest of Eddie Tipton on two counts of fraud for attempting to illegally participate in a lottery game as an employee of the MUSL, and then trying to claim a prize through fraudulent means.
[9] When his trial began on April 13, 2015, evidence was introduced by the prosecutors to support allegations that Tipton had rigged the draw in question by using his privileged access to an MUSL facility to install a rootkit on the computer containing Hot Lotto's random number generator, and then attempting to claim a winning ticket with the rigged numbers anonymously.
The December 29, 2010, drawing of the multi-state lottery game Hot Lotto featured an advertised top prize of US$16.5 million.
[22] On December 6, Johnston phoned again, stating the ticket was actually owned by an anonymous individual who was being represented by a Belize-based shell company, Hexham Investments Trust.
[22] On December 29, 2011, less than two hours before the expiration of a one-year deadline for prize claims, representatives of a Des Moines law firm presented the winning ticket at the Iowa Lottery headquarters, signed on behalf of Hexham Investments and New York City-based attorney Crawford Shaw.
[22] On January 12, 2012, Shaw met with Iowa Lottery officials in person to try claiming the prize, but was turned down yet again after he refused to identify the owners of the trust.
[22] In October 2014, investigators released surveillance footage from a Des Moines convenience store which they believed showed the purchaser of the ticket.
[5] He was later identified as Eddie Raymond Tipton, the director of information security at the Multi-State Lottery Association (MUSL), which organizes the Hot Lotto game.
[9] Hot Lotto draws are conducted using a random number generator running on a computer in MUSL's Des Moines facility.
[2][3] Tommy Tipton served 75 days in jail in Texas, after pleading guilty in June 2017 to conspiracy to commit theft by deception.
[4][31] As of 2019, Eddie and Tommy had largely avoided paying the over $2.3 million in restitution they owed to Oklahoma, Colorado, Kansas, and Wisconsin.
[30] Tipton sued the state of Iowa in January 2020, claiming he was pressured four years ago to plead guilty to crimes he did not commit.
[32][33] On February 4, 2016, the Iowa Lottery and the MUSL were sued by Larry Dawson, who won a $6 million Hot Lotto jackpot several months after the rigged draw.
As such, Dawson claimed that, given the parties' failure in properly auditing their games, he was entitled to $10 million that was not officially awarded in the rigged draw.
Iowa Lottery CEO Terry Rich criticized Dawson's lawsuit for its attempt to "rewrite history", stating that, "No one can know what would have occurred in this case had any event in it been changed.
[17] On January 28, 2018, GSN aired a documentary about the Hot Lotto fraud scandal called Cover Story: The Notorious Lottery Heist.