In the popular imagination, the lottery is a harmless amusement in which people spend a few dollars on a Powerball ticket when the jackpot gets big. 

Data journalists and reporters from the Howard Center for Investigative Journalism at the University of Maryland and from Boston University found this is not the reality.

Increasingly powered by multinational corporations, state lotteries have become the engine of a multibillion-dollar wealth transfer that relies on spending by less-educated and less-wealthy Black and Hispanic Americans.

Students from the University of Maryland’s Philip Merrill College of Journalism conducted a first-of-its-kind analysis of mobile-phone location data to prove that the majority of customers at lottery retailers come from nearby neighborhoods and, using census data, that those neighborhoods are disproportionately home to Black, Hispanic and lower-income people.

They also examined marketing and advertising documents, state spending records, legislative history, federal financial disclosures and education funding formulas to follow the money from the sale of a scratch-off ticket to show who was really benefiting from that spending.

The end result is a package of stories, called “Mega Billions: The great lottery wealth transfer.” It not only documents the wealth transfer made possible by lotteries – it examines the factors that make it possible: increasingly sophisticated advertising that is not subject to federal regulations; a lobbying campaign to create state lotteries that was often billed as grassroots but was orchestrated by the biggest lottery management firm; the growing privatization of state lotteries as states turn over the running of their games to four multinational corporations, none based in the U.S.

The mission of the Howard Center is to teach the next generation of investigative journalists through hands-on investigative projects. Student journalists have teamed with Merrill College’s professionals to win some of the nation’s top investigative journalism awards for packages that focused on such topics as climate change, lynching culture, homelessness and how companies prey on the poor. The center is generously funded by a multimillion grant from the Scripps Howard Foundation in honor of Roy W. Howard, one of the newspaper world’s pioneers.


University of Maryland

Reporting and photography: Brandie Bland, Tinashe Chingarande, Shannon Clark, Jillian Diamond, Elizabeth Flood, Spencer Friedman, Emmett Gartner, Victoria Ifatusin, Daniel Lawall, Alexandra Macia, Jon Meltzer, Lauren Mowry, Stephen Neukam, Zoe Pierce, Vanessa Sanchez, Kate Seltzer and Abby Zimmardi. 

Data reporting and graphics: Aadit Tambe, Rachel Logan, Jamie Pinzon, Michael Purdie and Shreya Vuttaluru. 

Public records requests: Trisha Ahmed Hoque, Julia Arbutus, Chris Barylick, Joshua Davidsburg, Natalie Drum, Brittany Gaddy, Alexandra Gopin, Daisy Grant, Eric Harkleroad, Kelly Livingston, Rachel Logan, Carmen Molina Acosta, Allison Mollenkamp, Ashkan Motamedi, Clara Niel, Pierce Panagakos, Gabriel Pietrorazio, Jack Rasiel, Vanessa Sanchez, Rina Torchinsky, Molly Work, Jason Belt, Damon Brooks, Sydney Bullock, Ava Castelli, Seth Mateo Cohen, Kinsey Gibb, James Hollenczer, Julia Joseph, Hyun Lee and Steven Mehling.

Editing: Professor Deborah Nelson, Howard Center Data Editor Sean Mussenden, Associate Professor Rob Wells, Lecturer Constance Mitchell Ford, Howard Center Director Kathy Best, Communications Manager Josh Land and Capital News Service Audience Editor Alexander Pyles. 

Digital design and web production:Capital News Service Data Editor Adam Marton.

Logistical support: Howard Center Program Coordinator Maria Lee.

Boston University

Reporting and photography: Henry Kuczynski, Ethan Biddle, Isabel Tehan and Melissa Ellin. 

Editing: Associate Professor Maggie Mulvihill.

This post was originally published on Howard Center for Investigative Journalism.