The McDonald’s Monopoly game is one of the most successful marketing promotions of all time.
Every year, for a limited time only, you can win big money collecting Monopoly pieces. The packaging on McDonalds products has properties from the board game, and if you get, say, both Boardwalk and Park Place, you win a $1 million prize. Of course it’s more likely you’ll instantly win a less lucrative prize like a Filet-O-Fish.
The game has a cult following. People visit McDonalds each year -- even fast food haters -- just to collect the pieces and take a shot at winning $1MM. The promotion is so successful, McDonald’s has run it for two decades.
But from 1995 to 2001, the game had only one real winner. This the story of Jerome Jacobson, the man who cheated at McDonalds Monopoly to a tune of $20 million.
Careful Who You Let Be Banker
The key to a successful promotion like McDonalds Monopoly lies in the probabilities. Prizes need to be ubiquitous enough that the game is fun, but grand prizes need to be few and far between so that the bump in sales more than offsets the cost of the prizes.
Promotions usually achieve this by giving out lots of cheap prizes and only a handful of grand prizes. The creators of McDonalds Monopoly do the same, doling out lots of sodas and medium fries to 1 in 4instant winners. But some years no one wins the $1MM grand prize.
The Monopoly setup, however, makes the odds behind grand prizes more deceiving. To win one, customers need to collect a full set of properties from the Monopoly game. An entire generation of parents has argued with children who demand McDonalds because they just need one more property to win. But everyone is just one game piece away from a grand prize. Rather than make each piece appear with the same probability, McDonalds makes one piece from each set extremely rare. So thousands of people with 3 out of the 4 railroads are all searching for Short Line Railroad, with only 1 in 150 million odds of finding it.
The setup draws scammers, who put out Craigslist ads or post on forums that they have Park Place and want to team up with someone who has the (rare) Boardwalk piece. When someone ignorant of the odds agreed, he or she sends the rare piece and never hears from the scammer again.
Jerome Jacobson had a simpler idea. Jacobson worked as head of security at Simon Marketing Inc, the company entrusted with running almost every McDonalds promotion, from Happy Meal toys to the Monopoly game. Simon’s internal policies called for 2 or 3 people to oversee the production and distribution of game pieces, but Jacobson alone oversaw the distribution of Monopoly pieces around the country. In 1989, two years in the running of the promotion, Jacobson stole a piece worth $25,000 and gave it to his stepbrother. By 1995, the former police officer was stealing all the pieces of value.
The Florida Times-Union describes how Jacobson made off with the valuable real estate:
Jacobson oversaw a security process that began at a printing plant where pieces were made, separated by value and stored in a vault. He was responsible for transporting those pieces in sealed envelopes to plants that manufactured McDonald's food cartons and cups, where the pieces were supposed to be attached.
But Jacobson would slip into airport bathrooms, lock himself in stalls and carefully open the envelopes to steal the pieces. He received cash kickbacks for stealing 50 to 60 pieces and bought homes, cars and other property.
Jacobson couldn’t redeem the pieces himself, nor could his family without attracting attention. Instead he sold the pieces to people he recruited through friends and family. Some of the recruits mortgaged their house to pay a mysterious figure they knew only as “Uncle Jerry.” The prizes included $10,000 cash prizes, cars, and even the rare $1 million prizes awarded with much fanfare.
In 1995, St Jude’s Children’s received an anonymous gift of McDonald’s pieces worth $1 million (A receptionist nearly threw the unmarked envelope away before discovering its value.) Who was the anonymous donor behind this generous gift? Uncle Jerry of course.
Uncle Jerry Gets Caught
The scheme worked for six years, until someone recruited by Jacobson and his friends to win a 1996 Dodge Viper revealed the fraud to the FBI. The agency in turn launched “Operation Final Answer,” in reference to Who Wants to Be a Millionaire.
The FBI informed McDonalds, but asked the fast food chain to continue running the contest so agents could collect evidence. Wiretaps, phone records, and (according to the FBI) “some of the most sophisticated and innovative investigative techniques available” helped the agency prove that the mysterious Uncle Jerry at the center of the scheme was Jerome Jacobson. The pattern of prize winners mortgaging their house just before they won also provided evidence of Jacobson’s role. Agents also followed several suspects as they met with recruiters, in one case going to, in the words of the FBI director, “a secluded lot in, of all places, Fair Play, S.C.”
In court, Jacobson apologized for his actions. He earned $1 million himself from the fraud, which he returned as a result of the case. He was sentenced to 3 years in federal prison and was released on October 21, 2005. Some 51 other members of the conspiracy were indicted, and many pled guilty, yet few faced stern sentences. On appeal, a Florida judge overturned the criminal sentences for 4 of the most central members of the plot.
McDonalds Monopoly Lives On
Uncle Jerry’s actions didn’t deter enthusiasm for McDonalds’s Monopoly promotion.
McDonalds reacted to revelation of Jacobson’s actions by going on damage control. It fired Simon Marketing Inc, taking its $500 million contract elsewhere, and announced an additional cash giveaway promotion worth $10 million in 55 cash prizes as an apology to players who for years had played a rigged game. (McDonalds did continue to pay St Jude $50,000 installments on its million dollar prize, even though it was fraudulently won through Jacobson.)
Most McDonalds company kept playing the game obliviously, and the McDonalds Monopoly promotion is now over 25 years old. Law enforcement, meanwhile, had a hard time maintaining a serious tone. Attorney General John Ashcroft stressed in an announcement that “We want those involved in this type of corruption to know that breaking the law is not a game.” CNN’s reporter deadpanned that “Jerome Jacobson allegedly monopolized McDonald's winning real estate.” But a local Florida paper probably said it best: “It's a scam only the Hamburglar could love.”
This blog post is an excerpt from our mildly amusing book → Everything Is Bullshit.
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