Texas Lottery Prohibits Online Ticket Sales by Third-Party Couriers
The Texas Lottery announced Monday that it is banning third-party courier services from selling lottery tickets online after concerns were raised by Lt. Gov. Dan Patrick and state lawmakers.
The policy takes effect immediately and “aligns with legislative efforts to address serious concerns raised by players and state leadership regarding the integrity, security, honesty, and fairness of lottery operations,” according to a statement from the Lottery Commission.
Retailers that collaborate with couriers will lose their sales agent licenses, the commission stated.
Courier services operate by accepting online orders or app-based requests, purchasing lottery tickets from retailers, and providing buyers with scanned copies while holding the tickets until the drawing. These services charge fees for purchasing and managing tickets, according to the commission.
The policy shift follows concerns from Texas lawmakers that couriers violate the intent of state law, which mandates that tickets be sold directly to individuals at retail locations.
Following sharp criticism from Texas senators at a recent committee hearing, the commission sought a written opinion from Attorney General Ken Paxton regarding its regulatory authority over courier transactions.
Lawmakers have also introduced legislation aimed at restricting the practice.
State Rep. Matt Shaheen, R-Prosper, who proposed a bill this session to prohibit online lottery ticket purchases, welcomed the commission’s decision.
“They were slow, but it’s better late than never,” Shaheen said.
Shaheen has also introduced another bill to eliminate the lottery altogether.
“I have a bill to get rid of the lottery and fund public education through other means in the general revenue,” Shaheen said. “The lottery targets low-income Texans, and the state of Texas shouldn’t be exploiting low-income families for revenue.”
The lottery contributes approximately $2 billion annually to Texas schools, an amount that, when combined with state, local, and federal funds, covers about five days of a standard 180-day school year.
The Texas Lottery faced heightened scrutiny after several companies, including a courier service, won a $95 million jackpot in April 2023 by purchasing over $25 million worth of $1 tickets.
Last week, Patrick raised concerns over an $83.5 million jackpot won in February. He visited Winners Corner, an Austin lottery store where the winning ticket was purchased. The store has ties to a courier service.
Patrick wrote on social media platform X that the store was packed with “terminal after terminal after terminal,” offering an experience unlike that of a typical convenience store lottery sale.
In a statement Monday, Patrick criticized lottery officials for delaying action and said the policy change proved they “had the oversight authority all along and allowed these businesses to creep into Texas and undermine the integrity of the Texas Lottery.”
“I’ve never read so much garbage from a state agency press release in my 18 years in office,” Patrick wrote. “After years of claiming they had no authority to regulate lottery couriers, today the Texas Lottery Commission suddenly exercised the ultimate regulatory authority by banning all lottery couriers in Texas.”
“The truth is, the only reason the Lottery Commission acted today was clearly because I exposed the courier services and the Commission when I showed up at one of the courier stores last week,” Patrick wrote on X. “Suddenly, they found religion and now want integrity in their game.”
The Texas Lottery, currently undergoing a sunset review process, will expire on Sept. 1 unless action is taken. Patrick has warned that the sunset bill will not be approved unless the lottery addresses the courier issue.
Although the ban on couriers is already in effect, lottery commissioners will review amendments formalizing the policy at their March 4 meeting, followed by a 30-day public comment period. The final adoption of the changes is expected at an April meeting.