A brilliant mathematician who won the lottery 14 times was let down by greed

According to statisticians, the chance of losing a life as a result of a shark attack is one in 3,750,000. This is much more than the chance of winning the American Powerball lottery when the jackpot is hit. The theoretical probability of such an event is one in 175 million.

Which is why Virginia officials were paranoid when they discovered that the 1992 jackpot of $27 million had a single winner in all categories. He won 6 more times in the second category of winners, 132 times in the third and 135 times in the lower categories, for a total of another $900,000!

Superlucky? Far from it. As it turned out later, this man was not even a gambler. His winnings were based on a mathematical formula and an unparalleled story that went down in the annals of lottery history. He was the organizer of a network of international investors, dozens of computers and printers that guaranteed success in drawing this jackpot. Just because Stephen Mandel played all possible combinations.

He was a Romanian mathematician who could not come to terms with the poverty and misery of the communist regime. As a restless man with a monthly salary of 360 lei (equivalent to 77 euros today) as an accountant in a mining cooperative, in the 1960s he looked for ways to increase his income. He immersed himself in scientific research, studying the “Fibonacci sequence” with the prospect of using it in games of chance to draw numbers. After several years of work, he developed a number selection algorithm that allowed “guessing” 6 lottery numbers, significantly reducing the 3,838,380 combinations that make up a 40-number lottery.

The formula has never been revealed. But it was thanks to her that he was able to emigrate with his family from Romania. After collecting a small amount with friends, he and his friends ventured to play every possible combination that his algorithm could come up with. The minimum was to get 5 numbers, but with the help of luck they got all six and won about 17,000 euros.

Mandel took his share and did not hesitate. His grandiose plan could only be successfully implemented in a capitalist country. The move to Australia meant that he was now free to trade with Commonwealth countries and have access to the British lottery system.

Mandel secured his livelihood by finding work in Australia as an insurance salesman and set sail. He set up a kind of lottery business based on the fact that in his method the cost of playing all combinations was significantly lower than the potential profit in the case of some jackpots.

Of course, he did not have the necessary funds or time to fill and raffle off such a large number of tickets. Thus was born a kind of “prank syndicate”. He managed to convince hundreds of investors to join his scheme and subsequently automate his system, which until then was manual and had a serious chance of error. He rented an apartment, which he filled with computers and printers to accurately calculate and print every possible combination.

Everything was ready, all that remained was to hit the big jackpot. I just needed to be patient. Opportunities appeared quickly. Mandel and his partners won a total of 12 draws in Australia and the UK! And this despite the fact that at some point the authorities tried to change the rules of the game, realizing what was happening: behind all these successes there is someone who buys all possible combinations.

His activity through this peculiar “company” was perfectly legal, and the state was forced to take steps to make it “illegal”. To the law that forbade a person to “buy” all the possibilities of the lottery, Mandel “answered” by finding five partners. When it was forbidden for groups of people to buy all lottery tickets, a Romanian mathematician created a company. But after his 12th win, in-house printing of tickets was also banned. Up to this point, players could print tickets from their home computers. Mandel became convinced that the climate in Australia no longer suited him.

He had to transfer his system to a more “investment-friendly” country. Perhaps even more profitable, because after the distribution of profits among the participants, the payment of taxes and expenses for the purchase of tickets, the amounts he earned were not exorbitant. For example, with a win of $1.3 million in 1987, he eventually received about $100,000.

Mandel’s next destination was the United States. But he needed to find a state in which he could open his “factory” on the most favorable terms. After careful research, he came to the conclusion that the Virginia Lottery was ideal: printing tickets from home, only 7.1 million combinations (compared to 25 million in other games) and a low cost of one dollar per ticket.

The amount was supposed to be divided into 20 annual payments, but the Virginia authorities tried to trip Mandela, considering his method unethical. Then the local press wrote about “a mysterious Australian syndicate who invested $ 5 million in a huge jackpot.”

After reviewing the Virginia State Lottery Regulations, they found that a ticket is only legal if the player pays for it at the authorized store where it was purchased. Mandel’s tickets arrived at the stores full, raising doubts about their validity. In the four-year legal battle that followed, Mandel found himself under the microscope of 14 international agencies such as the CIA and the FBI. In the end, the logic and the lawyers of the most calculating player in history prevailed. Once the ballots were allowed to participate, they had to be considered valid.

In 1996, Mandel was acquitted, but that’s when he went off the rails. He sold $20 million, which he was supposed to receive in installments from the winnings, to an insurance company for $14 million, most of which ended up in his Hong Kong account.

Investors only got back $1,400, meaning they also lost about $2,500. The last letter he sent to them was in 1994, and it essentially foreshadowed what was to come. “What we calculated has changed. Perhaps now it is not a very good investment …”.

Even before receiving “hot” money, Mandel unsuccessfully tried to organize an insurance company and a lotto in Gibraltar, and in 1995 he declared bankruptcy. Jewish by birth, he later tried to repeat the Virginia trick in Israel. However, apparently, he was set up by the old “fellow travelers”. Accusing him of not returning the odds and winnings, he was brought to trial, and Mandel was imprisoned in Israeli prison for 20 months.

Mandel became a “victim” of his own greed, but learned a lesson. After his release, he tried to stay away from the attention of investors and, accordingly, from the public. On May 11, 2023, Mendel unexpectedly showed up in Israel after a 21-year absence. However, three years ago, at the height of the coronavirus pandemic, Mandel announced his intention to return to Israel. However, his wife was detained in London and the return had to be postponed.

In recent years, Stefan Mandel has lived in the Pacific island nation of Vanuatu, away from justice. The idea of ​​returning to Israel came to him when he realized that an international arrest warrant issued at the request of the Israeli authorities would not be enforced immediately.

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