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The Stefan Mandel Story

Talk with any advantage player about the lottery, and the chances are that they'll laugh in your face. After all, lottery games need absolutely zero skill, and every one knows that they are just for poor suckers, grandmothers and dreamers. You only have to consider the odds of being around 1:292 million. Or rather you have a much greater chance of being struck by lightning over the course of your lifetime, at just 1:3,000. Luckily, no one told Stefan Mandel these facts.

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Introduction: Stefan Mandel

Stefan Mandel has won more lotteries than anyone. Ever. Thanks to skill as opposed to luck, he managed to win 14 lotteries in three countries and pocketed the resulting $40 million. He’s pretty shy about discussing his good fortune, but says, “I’m a weekend mathematician, I’m an accountant with too much education. But, mathematics, applied properly, can guarantee a fortune.”

In The Beginning

As a young man he was living in Romania, and in 1964, he was working as an accountant for the national mining company. In those days the country was under socialist rule, and like everyone, he was looking for a means of improving his lot in life. Without a reason, Mandel started to focus on the Romanian State lottery. he looked at it from every angle. Even though he didn’t have a computer, he still managed to figure it all out. Just his brain, intellectual ambition and a desire to leave Romania and change his life.

Whenever he was not at work, Mandel devoted all his time to mathematical theories and concepts. In the end, he formulated a concept which he called, “Combinatorial Condensation”. This was an algorithm that allowed him a guaranteed second place in a six-number lottery. It picked five of the six numbers and was accomplished by buying all the tickets featuring those numbers. By doing so, he could 100% guarantee success.

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Stefan Mandel: First Triumph

After having shared his theory with a group of friends, he secured their backing for the scheme. They all bought the correct tickets and he scored his first of many triumphs. They were lucky in that, though they were aiming for a second-place finish, they actually ended up winning first prize. This was for $30,000. After paying back his investors along with the tax bill, Mandel ended up with a tidy $5,000 or around $40,000 in today’s money. Though this was not exactly a fortune, you have to remember that this was the equivalent of eight years of his salary.

Off Travelling

We don’t know much about his life over the next few years. What is certain is that he did finally leave Romania and spent some years just traveling around Europe. Eventually, he found his way to Israel where he went to university in Haifa and took a degree in economics. We do know that by 1980, Stefan Mandel had made his way to Australia. Here he took a job as an accountant, whilst investing heavily in precious metals. He was living a regular life, and though he did think about the state lottery there, the prospect of beating a draw with 45 numbers and over 8 million possibilities seemed even beyond his genius. But why not give it a go!

Stefan Mandel: The Sydney Lottery

So Mandel once again took to studying the lottery and all its complexities. He formulated an algorithm that reduced the number of tickets from 8 million to 3 million. Though it was a lot more profitable, it was also a lot more complicated. The whole scheme seemed both impossible and quite unreal. But Stefan Mandel knew better. As he said, “Not all lotteries are profitable from the player’s point of view,” he has said. “The only sure way to win is to cover all the possibilities. The one in Sydney provided the opportunity for me to invest $7-million in order to win $27-million.”

Thanks To Computers

Once again, with his excellent pitch, Mandel was able to secure investors in his scheme. The technology was also helping him. We are now in 1987 and personal computers were easy to access. He used them to go through the math and to print out all the ticket forms. “When I announced [in 1987] that I would take the big prize in the Sydney lottery, everyone told me, ‘You won’t succeed,’” Stefan Mandel said. “I got angry and won the big prize 13 times in a row, with $400,000 in smaller prizes.” Well, the Australian authorities got pissed and so changed the lottery laws in order to make Mandel’s game plan work again. So he decided to set his sights on the US, and on the Virginia lottery in particular as this had the least number combinations.

The Virginia State Lottery

In order to purchase every ticket, he’d need to set aside $7.1 million. He would then have the tickets printed out at home in Australia and then shipped back to the US. But with such a large initial investment, Mandel needed to wait for a lottery rollover before proceeding. And so he waited and kept an eye on the size of the pool. Wen it eventually hit $27 million, Mandel put his plan into action. Essentially, he had just three days to buy all 7 million tickets.

Over thirty computers and dozens of printers were now working. In fact, he used around 25 tons of paper to print out the betting slips. He then spends a further $60,000 having them flown back to the US, where an army of accountants was on hand to get them to the lottery outlets and then pay for the ticket that has been printed.

Living On An Island In The South Pacific

Though everything went off smoothly, the team actually ran out of time. They “only” managed to buy 5 million tickets at the time of the draw. Stefan Mandel scored the first prize, along with added millions of dollars in smaller prizes. Though this was a great deal for Mandel, for some of his “investors” it was not. He paid himself $1.7 million for organizing it all. But some of his investors, who for example put $4,000 into the pot, only saw a return of $1,400 after deductions and taxes. Not surprisingly, the US government sent a team over to inspect Mandel and his team. The Virginia Lottery Board tried it’s best not to pay out Mandel, but in the end, nothing illegal had taken place. As you can imagine, they changed the lottery rules pretty fast after this case.

Now backed-off from the most lucrative lotteries in the world, Stefan Mandel spends his days on his desert island in the South Pacific. He no longer gambles according to the latest lottery news.