Texas Lottery Commission, ex-director face felony charges in 2023 Lotto scheme

Former Texas lottery director Gary Grief and the Texas Lottery Commission have been criminally charged with misusing their positions in a $95 million Lotto Texas draw in which the agency assisted international gamblers engineer a guaranteed win, earning tens of millions in profits at the expense of ordinary players. 

The April 22, 2023, Lotto Texas draw was the subject of a two-year Houston Chronicle investigation that revealed how the executive and agency tasked with overseeing the game helped the professional bettors purchase virtually every possible six-number combination — more than 25 million tickets in all — thus assuring they would have a jackpot winner.

Court records show the Travis County District Attorney’s Office issued summonses for Grief and the commission on Wednesday, indicating the defendants were being notified of the charges. Grief was ordered to appear in court on June 26. The lottery commission’s summons was issued to Courtney Arbour, executive director of the Texas Department of Licensing and Regulation.

CHRONICLE INVESTIGATION: How rich investors stacked the odds for a $95M Texas Lotto win

The crime, abuse of official capacity, is a broadly worded offense alleging “intent to harm or defraud another” by misusing “government property, services, personnel or any other thing of value belonging to the government.”

Prosecutors pegged the value of Grief and the lottery commission’s alleged misconduct at more than $300,000, making it a first-degree felony.

For an individual, the crime carries penalties of up to 99 years in prison and a $10,000 fine. For an association or agency, the penalty is a $20,000 fine, or the amount of money gained or lost due to the misconduct.

In a written statement, Sam Bassett, Grief’s attorney, said, “The indictment returned by the Travis County Grand Jury is the product of politics, not facts demonstrating a crime. Gary cooperated with the Texas Ranger investigation but neither he nor his counsel had input with the Grand Jury. The Rangers had their direction from politicians searching for a scapegoat. When all facts are revealed in court, the public will see that Gary’s leadership at the Lottery Commission generated millions of dollars for Texas schools and veterans and there was no crime.”

Court records show a grand jury indicted Grief in mid-April. A day later prosecutors filed, then dismissed charges. That appears to have been a procedural snafu that prematurely leaked prosecutors’ intentions earlier this week.

The indictments against the lottery agency and Grief, who retired in 2024, are scant on details, saying only that their alleged crime was related to “the Lotto Texas drawing held on April 22, 2023.” Prosecutors typically file a more comprehensive document, including specific details of the alleged offenses, as a case progresses.

Participants said Grief was aware of the operation from the start, pre-approving the scheme despite it being unfair to regular players who purchased tickets unaware they could at best only tie for the jackpot with a player assured of holding a winning ticket before the draw was even held. Grief has denied giving the go-ahead.

To process and print the millions of tickets in the 72 hours between Lotto draws, organizers needed dozens of official state lottery terminals and paper. Lottery officials went above and beyond to assist the team, quickly providing extra machines and pallets of paper with no questions asked – including to three retailers that had sold barely any tickets in the months prior. Lottery executives from other states described Texas’s official help as unusual.

As the big operation got underway, lottery officials then turned a blind eye to several apparent rules violations that, had they been enforced, would have prevented the scheme from being carried out. 

No other player guessed the right six-number combination, and, two months after the draw, the State of Texas handed an entity called Rook TX a $57.8 million check. The company collected another $2.5 million from lesser prizes.

The lottery commission typically audits large jackpots to make sure they are legitimate. But the agency’s after-game investigation of the April 2023 draw was perfunctory and failed to identify any misconduct. A second investigation following the Chronicle’s reporting confirmed that the gambling group appeared to have violated state rules.

Texas law allows lottery prizes over $1 million to be claimed anonymously. But the Chronicle identified Zeljko Ranogajec, an enigmatic Australian said to wager billions of dollars a year and known as “The Joker”; and Bernard Marantelli, a London-based gambler, as likely principals behind the operation. Both have since acknowledged their participation – Ranogajec as a funder, and Marantelli as the Texas point person in the caper. 

The revelations spurred two state investigations. In February 2025, Gov. Greg Abbott ordered the Texas Rangers to look into the drawing. Attorney General Ken Paxton said his office also would investigate. Sources said it was the Ranger investigation that was the foundation for the criminal charges.

As details of the enterprise trickled out, state lawmakers directed their ire at Grief, who during his 30-plus years at the agency – including 14 as director – had accumulated an unusual amount of autonomy.

An audit by the Sunset Advisory Commission, which performs a deep dive into the operations of state agencies every decade, concluded the Abbott-appointed board that was supposed to be overseeing operations had ceded much of its authority to Grief. A subsequent audit found that Grief also had made a series of controversial decisions whose legality was not entirely clear.

Grief was “comfortable operating in the gray areas” of the law, the report concluded.

In a February 2025 legislative hearing, an executive for Lottery.com, which was affiliated with two of the retailers that participated in the big buy, testified that a representative from the company had called Grief prior to the operation to check if the state would permit it. The executive, Greg Potts, said he fully expected the director to say “no.”

Instead, “we were very surprised that the answer was yes,” Potts told legislators. “As a person and a lottery player, I cannot believe they said yes. I was shocked.”

Potts also confirmed that the agency was “fully aware” that one of Lottery.com’s facilities was in violation of state rules, and did nothing.

“We just need to call in the Texas Rangers immediately,” Sen. Lois Kolkhorst, a Brenham Republican, said. 

“You’ve got this Gary Grief guy out there who has enabled, or helped to promote having this money laundering going on,” Sen. Carol Alvarado, a Houston Democrat, added. “He’s out there with no criminal charges or consequences.”

After enduring withering criticism from state lawmakers during several hearings, in April 2025, Ryan Mindell, Grief’s successor as lottery director, submitted his resignation. In June, Abbott signed legislation dissolving the lottery commission and moving oversight of the game to the Texas Department of Licensing and Regulation.

Fallout from the April 2023 Lotto Texas draw also spurred several lawsuits. One – filed by the winner of the following jackpot claiming the Rook TX win was illegitimate so his prize should include their winnings – is ongoing.  

This is a developing story.