The rise and fall of a 14-time lottery winner
A 14-time lottery winner ended up scoring thousands of dollars — before he lost it all.
Romanian economist Stefan Mandel, now 89, was once desperate for cash, so he ended up figuring out just how to beat the system to win the lottery.
Mandel spent years planning and doing mathematical research to come up with a “number-picking algorithm,” drawing on a method he called “combinatorial condensation.”
He figured out that sometimes the price of buying enough lottery tickets to play every possible combination was less than the jackpot prize — so he could make a profit by doing so.
If a game needed six numbers between one and 40 to be selected, there would be 3,838,380 possible number combinations.
Mandel formed a lottery syndicate — a group of people who play the lottery together by pooling their money together to buy multiple tickets, increasing their winning chances.
He and his syndicate bought a huge amount of tickets and took home the top prize: almost $19,000.
After splitting up the profits, Mandel was left with about $3,700 — just enough to avoid Romanian officials and escape Communism. He moved with his wife and two kids to Australia in the 1960s.
Mandel’s method with his syndicate allowed them to win the lottery 14 times, and it was always completely legal. In the wake of his big wins, Mandel convinced investors to build a bigger lotto syndicate, with one syndicate manager buying all the tickets and splitting the cash.
He continued to grow his technique and eventually turned it into an automated system. He designed the system to allow printers and computers to automatically apply the algorithm to fill out tickets with every number combination.
The automatic method gave Mandel and his group 12 lottery wins and thousands of smaller prizes across the UK and Australia — but eventually, authorities caught on and started to investigate them.
Since the method wasn’t illegal at the time, the rules were changed to ban bulk-buying tickets as well as the use of computer-generated tickets.
But Mandel didn’t let this stop him.
He used the money he already had to search for scouts across seas in the United States, as well as compiling data on previous lotteries with jackpots that were higher than the total cost of tickets for all number combinations.
He locked in on the Virginia Lottery, which only used the numbers between one and 44, so the total number of possible combinations was millions lower than other lotteries.
The former economist set up an official company, Pacific Financial Resources, and a trust under it, called the International Lotto Fund, and convinced thousands of investors to increase funding by millions.
Mandel created a headquarters at a warehouse in Melbourne with a full-time staff of 16 people to use his method to print out seven million lotto tickets over a span of three months, which he mailed to an associate in the US. The group got lucky, winning the lottery as well as additional smaller prizes.
Once again, Mandel’s methods weren’t illegal, but they raised many suspicions with authorities.
Mandel was brought into a four-year-long legal battle, and he was eventually cleared of any wrongdoing — but this caused him financial troubles.
He pocketed millions from his wins, but his investors were left with less money than they were supposed to receive.
Mandel ended up filing for bankruptcy in 1995.
His methods of lotto madness led the US to establish laws banning it.
“I’m a man who takes risks, but in a calculated way,” Mandel told Romanian newspaper Bursa in 2012. “Trimming my beard is a lottery: There is always the possibility that I’ll cut myself, get an infection in my blood and die — but I do it anyway. The chances are in my favor.”
Now, Mandel lives on a tropical island called Vanuatu, along with many of his former syndicate group.
