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Prosecutors: 'Ironman' ran illegal lottery, must forfeit $2.8 million

The Ironman Group will remain headquartered in Tampa following its purchase for $730 million by a New York company. In 2008, Joanna Zeiger won the Foster Grant Ironman World Championship in Clearwater, a 1.2-mile swim, 56-mile bike and 13.1-mile run.

TAMPA — It takes dedication, training and quite a bit of money for elite athletes to qualify for the Ironman World Championship in Hawaii, the most prestigious triathlon on the planet.

Or one could just pay $50 to enter a lottery.

That's what thousands of triathletes have done since 1983 to get a coveted slot in the Ironman, which has been run from the Tampa Bay area for the past 35 years.

Those profits were illegal, according to the U.S. Attorney's Office, because World Triathlon Corp. of Tampa charged athletes for the chance to win.

So the company on Monday forfeited to the U.S. government the $2.8 million in lottery fees it made from the past three Ironmans. WTC, however, does not believe that it broke any laws.

"World Triathlon Corporation denies any wrongdoing," said the company's attorney, Ed Shohat.

But some local triathletes wonder why the Ironman has a lottery in the first place.

Clearwater Beach's Cassie McWilliam, 48, qualified for her Ironman age group in 2007 and 2008. That last year, she had to win two half marathons to make it to Hawaii.

And while she stood on the shores of Kailua Bay, waiting for the 2.4-mile swim that kicks off the 140.6-mile Ironman, she looked around and realized that some of her competitors didn't look like they should be there.

"I feel like a world championship requires world championship athletes," she said. "You have people who spend a lot of money and time trying to qualify and rightly earn a spot, and then there are other people who just win a spot?

"They're just not good enough to be there."

To McWilliam, it comes down to one thing: "It's all about money."

The Ironman has become increasingly lucrative since a Tarpon Springs ophthalmologist and a partner bought the Hawaii triathlon for $3 million in 1980.

Dr. James Gills, the founder and director of St. Luke's Cataract & Laser Institute in Tarpon Springs, was also an Ironman competitor when he and a partner bought the event and formed WTC to run it. In 2008 they sold WTC to Providence Equity Partners for what is believed to be $50 million to $80 million.

Providence has been monetizing the Ironman brand ever since. There are now 180 Ironman events in 20 countries and Ironman-branded products like Timex watches that cost up to $400. Last year, Fortune magazine wrote that Providence increased revenues up to $150 million annually.

The Ironman lottery was just one of the ways WTC made money off the triathlon. Every year 86,000 apply for 2,000 slots to swim 2.4 miles, bike 112 miles and run 26.2 miles in less than 17 hours.

There are four ways to enter: by qualifying in more than three dozen events, the lottery, a legacy program for past contestants and an eBay auction for charity.

The lottery offers 100 slots every year. It costs $50 a year to enter, and paying another $50 to the "Passport Club" can double the chances of winning.

The U.S. Attorney's Office used 2015's lottery as an example of how much it generates for the company: 14,254 people entered the $50 lottery, and 6,889 of them paid the extra $50 club fee. That generated an extra $1 million for the Ironman, or $10,571 for each lottery slot.

The lottery winners in this year's Ironman on May 30 will not be affected, the company said.

WTC did not return requests for comment on Wednesday. But in a statement, the company said that the lottery is a tradition established by founders John and Judy Collins to make the world-famous competition as accessible as possible.

"The Ironman Lottery has changed lives and provided athletes of all abilities the opportunity to participate in the world's most challenging and iconic one day endurance event," the statement said.

USA Triathlon, the sport's governing body in this country, said it supports that goal. It also said that the Ironman is the only one of the 4,300 events it sanctions that uses a lottery.

The U.S. Attorney's Office said that the $2.8 million forfeited by the company will go to the government, not to those who paid the money.

Shohat said that the federal government contacted WTC about four months ago. The company quickly decided that it wasn't worth it to contest the allegations.

"It's a business decision," Shohat said.

Palm Harbor's Spencer Smith, 42, is a former pro triathlete-turned-coach who competed in several Ironmans. He's also McWilliam's boyfriend.

He understands that the Ironman is a business and that its owners need to make money.

But that doesn't mean he has to like it.

"It may be elitist, but it's the world championship," Smith said. "Why bother having any qualifying races to begin with?"

Times researcher John Martin contributed to this report. Contact Jamal Thalji at thalji@tampabay.com or (813) 226-3404. Follow @jthalji.

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