For over three decades, the Texas Lottery has been sold to Texans as a voluntary way to support public education without raising taxes. But its troubled and controversial history, especially the recent developments suggesting an organized crime syndicate had infiltrated the state agency that operates it, have proven the government program to be no more than a hotbed of corruption and fraud, all at the expense of Texans.
A Poor Track Record
Launched in 1992 after voters approved a constitutional amendment, the agency promised billions in revenue for schools while operating with integrity and transparency. Instead, it has a track record of mismanagement,1 executive scandals, contractor conflicts, and outright schemes that have eroded public trust, funneled millions away from intended purposes, and exposed the dangers of predatory gambling.
From its earliest days, the Texas Lottery Commission has been plagued by leadership failures and vendor influence. Just five years after Gov. Ann Richards sold the first scratch-off ticket in May 1992, the first executive director, Nora Linares, was forced out amid revelations that her boyfriend had been hired as a consultant to the lottery’s chief contractor, GTECH (later rebranded as IGT) and now operates as Brightstar. An internal probe and Texas Rangers investigation followed, with then-Gov. George W. Bush bringing in Harriet Miers to stabilize the agency.2
Her successor, Lawrence Littwin, lasted only five months in 1997 before being fired. Littwin claimed he was dismissed for probing irregularities in vendor contracts and operations. He sued the agency, highlighting early cronyism and lack of oversight.
The pattern continued. Linda Cloud, who followed Littwin, resigned in 2002 after admitting she lied to the media to cover up a lottery commissioner’s alleged sexual harassment and physical assault of a female employee. She blamed instructions from Gov. Rick Perry’s chief of staff.
By 2005–06, Reagan Greer became the next to go, resigning after the agency was caught inflating advertised jackpots for Lotto Texas to artificially boost sales, a clear case of misleading the public and players.
One brief exception stood out: Acting Director Anthony Sadberry served without scandal until his death in office in 2008. But the culture of corruption quickly resumed under long-time insider Gary Grief, who rose to executive director and served nearly two decades.
A Breaking Point
Under Grief, the agency’s problems escalated dramatically. In 2015, he pushed to expand the lottery into sports betting, only to be blocked by Attorney General Ken Paxton. Undeterred, the commission began quietly enabling “courier” services and online resellers, effectively smuggling internet gambling into Texas through rule tweaks.3 A pivotal 2020 change removed the requirement that a player be physically present while tickets are printed, allowed 24/7 selling of lottery tickets, and allowed electronic playslips for draw games, opening the door to bulk purchases and third-party courier apps.
The breaking point came on April 22nd, 2023. An international syndicate, led by a Malta-based gaming executive and bankrolled by a London wagering firm with a history of cornering lotteries, spent approximately $25 million to purchase over 25 million tickets.4 They covered 99% of all possible number combinations in Lotto Texas, rigging a $95 million jackpot (paid as a $57.8 million lump sum to the Delaware LLC “Rook TX”). The operation used pre-programmed QR codes, extra terminals approved and provided expeditiously by the commission, and courier affiliates at four retailers across the state. Children were even reportedly seen helping print tickets in one location around the clock.
Lt. Gov. Dan Patrick called it “the biggest theft from the people of Texas in the history of Texas.”5 Internal reports later confirmed rule violations, yet the commission took no action at the time. Grief had pre-approved aspects of the scheme, according to courier executives’ testimony.
The scandal exploded in 2024–2025. A Houston Chronicle6 investigation exposed the foreign players. Sunset Advisory Commission reviews slammed lax oversight. A class-action lawsuit filed by longtime lottery watchdog Dawn Nettles accused Grief, Lottery.com, IGT, and Rook TX of fraud, misappropriation, and manipulating outcomes. Federal prosecutors indicted Lottery.com executives (including a Russian operative) for securities fraud tied to inflated revenues and the scheme. Leaked audio and videos surfaced showing further irregularities.
A second controversial jackpot followed in February 2025: an $83.5 million win claimed via the Jackpocket courier app at a tiny Austin retailer.7 The ticket was withheld amid probes. Investigations by the Texas Rangers, Attorney General Ken Paxton, and Senate committees revealed potential money laundering, sales to minors and out-of-state players, and commission complicity.
Executive Director Ryan Mindell (Grief’s successor) resigned in April 2025 after flip-flopping on courier regulation and facing withering Senate criticism during the 89th legislative session.8
Grief himself has reportedly gone missing during the height of the Texas Rangers’ ongoing investigation.
The Consequences
The consequences were severe: eroded player confidence, diverted proceeds through massive payouts to sophisticated syndicates rather than Texans, and millions in administrative waste on investigations and legal battles. Courier sales had reached $101 million in just seven months of one fiscal year, all while skirting the original intent of in-person, cash-only gambling at brick and mortar establishments.
In response, the Texas Legislature took some steps in the right direction. In June 2025, Gov. Greg Abbott signed Senate Bill 3070,9 abolishing the Texas Lottery Commission outright,10 banning courier services, imposing new restrictions on bulk buying, and transferring oversight. The lottery continues under tighter rules, but the agency that ran it for over 30 years is gone.
But many taxpayers wonder (and rightly so) if these actions will finally prevent corruption and fraud in the operation of the controversial government program, even under new management by the Texas Department of Licensing and Regulation.
Texans for Fiscal Responsibility has long warned that a government-run, predatory gambling scheme naturally invites waste, cronyism, and inefficiency. The Texas Lottery’s 30+ year history proves the point: repeated executive removals, contractor scandals, rule-bending for out of state and foreign entities, and millions siphoned from low-income or addiction-prone Texans.
While the abolition of the Commission is a victory for accountability and reducing government bloat, true fiscal responsibility requires a recognition that Texas families deserve education funding built on sound policy and fiscal discipline, not on a government-run, rigged game of chance.
These scandals are not anomalies. They are the legacy of the Texas Lottery.
Texans for Fiscal Responsibility launched Texas Anti-Predatory Gambling Alliance (TAPGA) in 2025 to focus on the harmful effects of predatory gambling on Texas taxpayers and families. TAPGA is advocating for the complete abolition of the Texas Lottery ahead of the 90th Legislature set to convene in January of 2027.
Texans for Fiscal Responsibility relies on the support of private donors across the Lone Star State in order to promote fiscal responsibility and pro-taxpayer government in Texas. Please consider supporting our efforts! Thank you!
Get The Fiscal Note, our free weekly roll-up on all the current events that could impact your wallet. Subscribe today!
- https://www.statesman.com/story/news/politics/state/2025/02/26/texas-lottery-commission-courier-services-jackpocket-history-scandal-controversy/80255746007/ ↩︎
- https://texasscorecard.com/analysis/analysis-the-texas-lotterys-100-track-record-of-corruption/ ↩︎
- https://texasscorecard.com/state/texas-lottery-commission-caught-misrepresenting-rule-change/ ↩︎
- https://www.houstonchronicle.com/news/investigations/article/surefire-lotto-texas-win-malta-exec-london-19727984.php ↩︎
- https://ktrh.iheart.com/content/2025-04-22-lottery-director-steps-down-after-biggest-theft-in-the-history-of-texas/ ↩︎
- https://www.houstonchronicle.com/news/investigations/article/texas-lottery-executives-sec-fraud-lawsuit-21316317.php ↩︎
- https://www.houstonchronicle.com/projects/2025/texas-lottery-scandal-timeline/ ↩︎
- https://www.texastribune.org/2025/04/21/texas-lottery-commission-resignation-executive-director/ ↩︎
- https://capitol.texas.gov/BillLookup/History.aspx?LegSess=89R&Bill=Sb%203070 ↩︎
- https://www.texastribune.org/2025/06/25/texas-lottery-commission-abolished-couriers-restrictions/ ↩︎
