Michigan Online Lottery Accidentally Giving Away Free Money

Posted on June 26, 2017
[toc]It’s not too often that you’ll find a beatable lottery game, but that is exactly what you’ll find if you play online lottery in Michigan.

An astute Michigander who runs a money management site ran some numbers and discovered an exploit in a particular keno game. The flaw allows players to beat the Michigan lottery for an average of around $62 after making a $200 deposit.

The strategy first appeared on the website DoctorofCredit.com (the posts have since been removed). The local ABC television station WZZM 13 also covered the story.

Here’s how it works.

The Michigan Lottery’s rookie mistake

The Michigan Lottery offers a 50 percent match bonus on a player’s first deposit up to $100.

In order to “clear” the bonus – be eligible to cash out any winnings – you have to wager the deposit and bonus amount dollar-for-dollar.

So, if you deposit $200, the Michigan Lottery will give you a free $100. You then need to wager $300 before you can withdraw whatever remaining balance you have in your account.

Anyone familiar with online casino or poker bonuses knows this is an extremely low play-through amount and likely exploitable if you play the right games.

That’s precisely what happened in Michigan. Some online lottery customers have discovered they can wager $300 on single-number Fuzzy Keno, betting $1 per game and playing 300 games, and only lose around $40 of the bonus money. They can then withdraw their original $200 plus the extra $60 or so dollars in profit.

Suffice it to say, the Michigan Lottery made a rookie mistake when it came up with its play-through requirements.

Why Fuzzball Keno is the game of choice

Fuzzball Keno was billed as the “best odds of any online game,” when it debuted on the Michigan online lottery website.

Unfortunately for the Michigan Lottery, the words “best odds of any lottery game” coupled with low play-through requirements for bonus dollars is a recipe for disaster.

The reason Fuzzball is the game of choice is because of a specific wager players can place on the game.

Fuzzball Keno allows players to select just a single number.

The payout structure of the game is even more bizarre.

If the number hits, the player doubles their bet. Pretty standard so far. What isn’t standard is if your number doesn’t hit, you get half your bet back.

Even if you were Eddie Mush, and you’re number didn’t hit once over 300 games, you would only lose $150. With the bonus, only $50 of that is your own money. The rest is the bonus money from the lottery.

Of course, you’d never go 0-300. You don’t have to be a statistician to know the odds of that happening are about the same as getting struck by lightning and bitten by a shark at the same time.

The statistics people discovered  the average profit after meeting the $300 wagering requirement was $62. Additionally, the chance of profiting is over 99 percent when wagering $1 per game. The odds go up to 100 percent when wagering $.10 per game.

In an email to WZZM, Calvin College statistics professor Thomas Scofield verified the DoctorofCredit.com numbers. The 99 percent and 100 percent figures are accurate.

“The author has rightly calculated that the expected profit for the various strategies the rows represent is $62.50,” Scofield said.

Michigan Lottery isn’t worried about this

Despite the evidence, the lottery didn’t seem disturbed by the findings. Michigan Lottery’s  Jeff Holyfield told WZZM:

“It is inaccurate to say that playing Fuzzball Keno or any lottery game in a certain manner guarantees gains for players. Like all lottery games, Fuzzball Keno is a game of chance and as with all games of chance, anything is possible. As the blog notes and as we constantly remind players, Lottery games are not designed to serve as investments or provide income. They’re games of chance designed to provide fun and entertainment.”

The Michigan Lottery doesn’t post the play-through requirements for bonus dollars. As a result, Play Michigan could not verify if they are still the same. There is no word if the lottery is retooling them to eliminate the exploit.

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Steve Ruddock

Steve Ruddock is a veteran of the poker and online gambling media. A contributor to OnlinePokerReport.com, PlayNJ.com, USA Today, and a variety of other industry publications both online and off, Steve is based in Massachusetts.

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