Maryland's big lottery winners want the money, not the renown

Maryland, meet lucky lottery winners "Kathryn and Ricardo," "Nittany Lions Fan," "Ocean Pines Winner" and "The Three Amigos."

They're fabulously wealthy and largely anonymous. And they intend to keep it that way, even as most other states — including the three in which record-high Powerball tickets were recently sold — require the fortunate few to step into the public eye.

Maryland is among six states in which winners' identities may be kept private. Its rules allows wary winners to hide their faces behind oversized checks and to use creative monikers instead of names in promotional photos posted on the lottery agency's website.

A Frederick couple, "Kathryn and Ricardo," opted to keep their last names hidden when they won $1 million in the Jan. 13 Powerball drawing featuring a record $1.58 billion jackpot. A Baltimore man who won $1 million in a recent instant ticket game publicly called himself only "Nittany Lions Fan," apparently reflecting his devotion to Penn State athletics.

But in such states as California, Florida and Tennessee — where winning tickets were purchased for shares of the Powerball jackpot — the claimants' names are public record. The winning Tennessee couple, John and Lisa Robinson, quickly came forward. More than a week after the drawing, the ticket holders had not yet surfaced in California or Florida, where winners are given one year and 180 days, respectively, to claim their prizes. The cause of the delay was unclear.

The anonymity issue raises a public policy issue. Lottery officials around the nation say it's healthy to identify winners because it keeps the games transparent and accountable. Allowing lottery agencies to recount players' success stories also offers an important marketing device.

Lotteries are important budget tools for many states. Maryland received $525 million from the lottery in the last fiscal year, and $487 million from casinos. The total of more than $1 billion was 19.1 percent higher than in the previous year. Those combined state revenues are only topped by income, sales and corporate taxes.

"The best thing for the lottery is for somebody to win and hold up that gigantic check and talk about how their life is going to be so much better," said Robert Pagliarini, California-based author of "The Sudden Wealth Solution."

But some analysts and player advisers — Pagliarini included — say big winners' lives soon will be complicated enough without sacrificing their privacy.

For a mammoth jackpot winner, "the amount of harassment is off the charts," said Richard Friedlander, tax partner at Rosen, Sapperstein & Friedlander, a business consulting and accounting firm.

Some states, such as Connecticut, allow winners to claim prizes using trusts or business partnerships. In other states, such as North Carolina, legislators have considered abandoning the public-disclosure requirement.

"Not being able to protect your privacy means that you don't have the option to try to minimize the negative social consequences when your family, friends, neighbors and work associates suddenly discover that you are their ticket to Easy Street," said George Loewenstein, an economics and psychology professor at Carnegie Mellon University. "You will also be hounded by sleazy would-be financial advisers who want to help you manage your money, and if you typify the financially unsophisticated winner, you are going to be vulnerable to" them.

Maryland Lottery and Gaming Control Agency director Gordon Medenica is the former lottery chief of New York State, where winners' identities are routinely disclosed.

"In New York, people would sometimes come to the winner press conferences wearing hats and sunglasses and scarves, but we would still announce their names and present the 'big check,'" Medenica said. "Occasionally, people would resist the requirement to appear at a press conference, but they would not receive their winnings until they appeared."

Only very rarely, Medenica said, was a winner given a waiver.

"For example, one winner was an active undercover detective and we allowed him to stay anonymous," he said.

Medenica said it's not clear "that anonymity really shields winners from exploitation." Sometimes, he said, the "exploiters" can be friends, acquaintances or even relatives.

Maryland lottery officials say the rules have allowed anonymity for as long as they can remember. Delaware, Kansas, North Dakota, Ohio and South Carolina are the other states specifically allowing lottery winners to remain anonymous.

The purpose is "to provide a shield for winners to avoid being approached by people looking to exploit their good fortune," said Medenica, who was appointed director by Gov. Larry Hogan last spring. "It's essentially a consumer protection argument."

Maryland officials estimate that 80 percent of the winners choose to not be identified, at least not publicly.

"Kathryn and Ricardo" happily posed behind their giant check in the Baltimore lottery headquarters "winners' room," telling agency officials they planned to use the winnings to start a college fund for their ten-month-old baby, buy a house, take a vacation and invest.

Many other winners, such as "Nittany Lions fan," have their faces obscured, and their photo depictions resemble oversized checks with arms and legs. In their 2012 group picture, the "Three Amigos" — public school educators who shared a $218.6 million Mega Millions jackpot in 2012 — employed a similar face-blocking tactic.

Maryland winners "can't hide their identities from us, only the public," said lottery spokeswoman Carole Everett.

"You want to make sure the person signed the ticket. And you want to make sure they don't owe back taxes or child support," which can be subtracted from winnings, she said.

Lottery staff members typically cheer as winners claim their prizes and pose for pictures.

"We want to make it fun, make it a richer experience — pardon the pun," Everett said.

The Jan. 13 Powerball drawing featured the world's richest lottery jackpot. California lottery spokesman Russ Lopez said there might be some anxiety about publicly claiming a portion of it. The California ticket, purchased at a suburban Los Angeles 7-Eleven, is worth $528.8 million — or $327.8 million if taken as a lump sum, all before federal taxes. Lottery winnings aren't subject to California's income tax.

"Anytime anybody wins there is always trepidation," Lopez said. "We're really looking out for the security of our winners. They don't have to take part in a press conference. Obviously we encourage them to get the media questions out of the way, then get lost. Go take a vacation."

The Robinsons — the Tennessee winners — were asked on NBC's "Today" if they were nervous about carrying such a valuable ticket.

"Now I'll be nervous because everybody knows,'' John Robinson said.

jebarker@baltsun.com

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