Ali Jaafar, 63, was the top individual lottery ticket casher in Massachusetts in 2019. His sons Mohamed, 31, and Yousef, 28, were third and fourth respectively, per Complex. According to prosecutors, family luck had nothing to do with it. In reality, the three men who cashed in more than 13,000 winning lottery tickets worth almost $21 million from 2011 to 2019 were running a ticket-cashing scheme that allowed the true winners to escape paying owed taxes or child support, as required with lottery prizes over $600 in Massachusetts, according to an indictment unsealed Monday.
Prosecutors said the trio falsely reported large gambling losses on their tax returns—$886,261 for Ali Jaafar, $106,032 for Mohamed, and $185,951 for Yousef—to minimize taxes paid on the winnings, per the New York Times. Ali Jaafar paid less than $24,500 in federal taxes on $15 million in winnings from 2011 to 2019, Mohamed paid less than $21,700 in federal taxes on $3.3 million in winnings, while Yousef paid less than $10,700 on $2.4 million in winnings, according to the indictment. They "conspired with others to purchase winning lottery tickets from the actual winners for cash, at a discount that was typically between 10-20% of each ticket's value," according to the US Attorney's Office for the District of Massachusetts.
The three men had unsuccessfully fought to reverse a 90-day suspension handed out by the Massachusetts State Lottery Commission in 2019. "I think it really speaks to a level of hubris," the commission's executive director, Michael R. Sweeney, tells the Times. Of their incredible number of winning tickets, most of which were scratch tickets, he adds, "a statistician will say that there's some astronomical odds … but the reality is, it's zero." The three are charged with conspiracy to defraud the IRS, conspiracy to commit money laundering, and filing false tax returns. Arrested Monday, Ali Jaafar and Mohamed pleaded not guilty. It's unclear if Yousef is in custody, per the Times. (Read more fraud stories.)