Jerry Selbee: I Cracked the Lottery and Won $26 Million
Every once in a while, you might come across someone claiming that they’ve figured out a way to game the system and win the lottery. The issue with these claims is that they rarely have any basis in reality. However, in the case of Jerry Selbee and his wife, Marge, a loophole in the system allowed them to win millions of dollars in prizes playing the lottery.
WHO IS JERRY SELBEE?
Jerry Selbee is a retiree from a small town in Michigan. He lived in Evart, population 1900, with his high school sweetheart, Marge. The couple had six kids together and ran a convenience store for 17 years before selling it and settling down to retire. When running the store, Marge was in charge of making sandwiches and keeping the books, while Jerry handled cigarettes and liquor. At the time of their retirement, Jerry was 62 and Marge was 63, and the couple had no plans except to enjoy life a little.
The couple’s plans changed slightly in 2003 when Jerry visited the old convenience store that they used to run. He noticed a brochure for a new lottery game, Winfall. By the time Jerry, who has a bachelor’s degree in math from Western Michigan University, finished reading about the game, he knew there was potential for him to win big money.
Within just a few minutes, Jerry realized that Winfall had a unique feature called rolldown that he could use to his advantage. Unlike other lottery draws, Winfall prizes rolled down any time the jackpot reached $5 million. This means that unlike a draw like Mega Millions, wherein the pot continues to grow until someone purchases a ticket that matches all of the numbers drawn, a Winfall player could split the jackpot without having to match every number, so long as the prize was at the $5 million cap. During one of those draws, if no one has a ticket with all the winning numbers, then players with five, four, or three winning numbers could win significant amounts of money. Essentially, the jackpot prize ‘rolled down’ to the lower-tier winners.
Jerry says that uncovering the loophole wasn’t difficult at all, as it was just a case of using basic math. Using a “basic” math equation, he realized that if he spent enough money, say, $1,100, then he could mathematically guarantee that he would have at least one four-number match, which would be worth $1,000. Not only that, he could win 18 or 19 three-number matches as well, which each come with a $50 prize. With 18 tickets, he could guarantee a $1,000 win for the four-number match and $900 worth of winnings for three-number matches. In total, he could spend $1,100 and get a $1,900 return. His plan was made even easier by the fact that the lottery would make an announcement each time a rolldown draw was happening.
HOW MUCH MONEY DID JERRY SELBEE WIN?
The next time Winfall announced a rolldown, Jerry bought $3,600 worth of tickets and won $6,300. The next time, he paid $8,000 and won nearly double that. It was only at that point that he filled his wife in on what he was doing. Marge says she wasn’t surprised that Jerry had figured out this system, as the equation made sense to her as well. The couple said the only thing that surprised them was that there weren’t a million other lottery players who had also figured out the loophole.
With Marge on board, the couple started spending hundreds of thousands of dollars on tickets for the rolldown draws. Eventually, Jerry set up G.S. Investment Strategies, a corporation that they invited their friends and family to join to share in the winning. They sold shares of the corporation for $500 each and even invited local investors to participate. One particularly successful draw took place when they played $515,000 and won $853,000 for their trouble—about a 60 percent return on their investment.
By 2015, Jerry and Marge’s lottery ‘club’ had 25 members. They had played the Winfall lottery 12 times, winning millions. One of the members of the club said that through his participation, he was able to pay for three kids to go to school, including law school. Unfortunately, Michigan shut down the Winfall game, citing a lack of sales.
The club wasn’t deterred for long, as one member noticed a similar game, Cash Winfall, organized by the state of Massachusetts. For six years, Jerry and Marge would drive to Massachusetts for every rolldown draw. They would spend, on average, over $600,000 on tickets, and then station themselves in a cheap hotel to sort through them. On some trips, they would be sorting through tickets 10 hours a day for 10 days in a row.
Over those six years, they would play seven times a year. On average, they would win $4.2 million a year. In nine years, Jerry and Marge Selbee’s group from their little Michigan town grossed over $26 million from playing the lottery.
WHAT IS JERRY SELBEE UP TO NOW?
Unfortunately, the Massachusetts State Lottery caught wind of the loophole, as a group from MIT had been doing the same thing as the Selbees. The Cash Winfall lottery was shut down.
Before taxes, the Selbees made nearly $8 million by playing the lottery. They used that money to renovate their house and help their 14 grandchildren and 10 great-grandchildren pay for their education. Though the lottery club is no longer making huge purchases on lottery tickets, they still get together for nickel and dime poker nights.
Jerry and Marge Selbee were fairly unique repeat lotto winners who were able to find a legal loophole that helped them earn millions of dollars. Though the small-town high school sweethearts don’t see anything too remarkable about their story, Hollywood disagrees. In April 2018, it was announced that their story will be made into a movie, though a release date has not yet been set.