Detroit News
Saturday, April 10, 2004 
Authorities break up private lottery, seize $2.2 million
Oak Park woman, 77, ran the game for years, sheriff's department says
By David N. Goodman / Associated Press

Facts on gambling in Michigan

-- In 1972, Michigan voters approved the creation of the Michigan Lottery.

-- The Michigan Lottery took in $1.68 billion in the fiscal year ending Sept. 30. Of the total, $712 million, or 42 percent, came from the twice-a-day Daily and Daily 4 drawings.

-- The net income from the lottery, $586 million, goes into the state's public education fund. In more than 31 years, the lottery has raised $11 billion for education.

-- Illegal numbers games frequently use the numbers by the Michigan and other state lotteries but have bigger payoffs. Michigan pays $250 for a winning 50 cent Daily 3 bet. And unless caught, customers of illegal numbers games can dodge taxes on winnings.

DETROIT -- For as long as Michigan has had a legal lottery, a 77-year-old grandmother may have been running her own own private lottery -- drawing millions of dollars in business by offering higher payoffs than the state. Authorities say they seized $2.2 million and broke up the family-run lottery that they say used the Michigan State Lottery Daily 3 and Daily 4 numbers but paid off significantly more money.

Operating from modest homes in the city and nearby Oak Park, the family business appears to have roots going back 30 years, the Wayne County sheriff’s department and prosecutor’s office announced Friday.

“Numbers operations have been around for several decades before the lottery, but this is the largest we have seriously disrupted,” Sheriff Warren Evans said. “They appear to have a large customer base and to have handled a tremendous amount of money.” Illegal numbers games have flourished in Michigan and elsewhere despite the growth of state-run gambling in recent decades, experts say.

Overall, Americans spend as much as $100 billion a year on illegal gambling, Dunsten said. “Numbers persist because its convenient, flexible, offers credit, and if you owe the government for taxes or welfare, it may be a better place to bet your money,” researcher Roger Dunsten wrote for the California Research Bureau. “And the payout is much larger than the approximately 50 percent of state-run lotteries.”

The state-run Michigan Lottery took in $1.68 billion in the 12 months ending Sept. 30. The net earnings support public schools.

The sheriff and county Prosecutor Kym Worthy declined to give details on the operation, saying more information would be released at the six defendants’ preliminary examinations. Officials say Heloise Johnson, 77, of Oak Park was the “matriarch” of the private lottery, running it with her daughter and three adult grandchildren. Prosecutors say another man also was involved in the case.

The defendants were named in warrants issued Thursday charging them with gambling conspiracy and taking illegal bets. They were scheduled to be arraigned Monday and, if convicted, face up to 5 years in prison and $10,000 in fines. Also charged were daughter Donna Toney, 56, of Oak Park; grandsons Keith Dunlap, 39, and Kian Williams, 26, both of Detroit; and granddaughter Keanna Hurt, 23, of Detroit. A sixth suspect, John Cunningham, 62, of Detroit, is unrelated. No one answered telephone calls Friday made to Johnson’s and Williams’ homes. The other suspects do not have listed numbers.

The sheriff and prosecutor are filing civil suits to retain the $2.2 million and use it to patch their recession-hit budgets, Worthy said. “Law enforcement can reap the benefits of this kind of behavior,” Worthy said. She said the extra cash would come in handy, “especially with all the homicides that are going on in Detroit and Wayne County.”