Lottery rigging accomplice used payout for offshore tax scam – Minneapolis Star Tribune

IOWA CITY, Iowa After Robert Rhodes collected a Wisconsin Lottery jackpot that had been rigged by his friend, he used the windfall for an investment scheme that produced another wave of undeserved government money, court records show.

Rhodes, an accomplice in a scandal that has shaken state lotteries, recently explained under oath how he used the $783,000 payout to receive an additional $180,000 in bogus tax refunds. The Texas businessman sent his lottery winnings offshore to buy a phony insurance policy for a personal corporation that never did any business except receive the lottery prize. He then claimed the policy as a tax-deductible "business expense."

The upshot: Rhodes received roughly $150,000 from the U.S. government and $36,200 from Wisconsin in tax refunds on the lottery payout. But in an ironic twist, the St. Lucia-based insurer where Rhodes sent his cash would later be accused of duping investors and, in Rhodes' words, "abscond" with a chunk of the loot.

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Lottery rigging accomplice used payout for offshore tax scam - Minneapolis Star Tribune