Lottery operator Camelot has been fined £3 million for control failures that led to a “deliberately damaged ticket” winning.
The Gambling Commission launched an in-depth investigation following claims that a “fraudulent” National Lottery prize had been made and paid in 2009.
The incident only came to light last year, the commission said, and was then referred to police.
Camelot told the BBC the suspect payout was £2.5m.
The Commission found that Camelot had breached the terms of its operating licence in three key areas: Its controls relating to databases and other information sources; the way it investigated the prize claim, and its processes around the decision to pay the prize.
While the Commission said it could not be certain a fraud had taken place, “it was more likely than not”.
The £3m penalty package has been paid by Camelot and is for the “benefit of good causes”, the Commission said, adding that £2.5m represents “the amount that would have been received by good causes had the prize claim not been paid.”.
The Commission said its investigation had led it to believe the fraud was “specific” and that there were not “systemic failings of the kind that would call into question other prize payouts”.
It said Camelot had since made changes to “strengthen” its processes.
Commission CEO Sarah Harrison said “The Gambling Commission’s chief concern is to ensure the National Lottery is run with integrity and that player interests are protected.
“Camelot’s failures in this case are serious and the penalty package reflects this. Importantly, the package also ensures that good causes will not lose out as a result of Camelot’s licence breach.
“Lottery players can feel reassured that our investigations have found no evidence of similar events happening and that controls are in place today to mitigate against future prize payout failings of this type.”
Camelot apologised for the incident, but stressed that it was a “one-off” and had nothing to do with the National Lottery’s integrity.
Camelot chief executive Andy Duncan told the BBC: “We accept that, at the time, there were some weaknesses in some of the specific controls relevant to this incident and we’re very sorry for that.”
He told the broadcaster that despite police being notified once the suspected fraud was uncovered, it was not taking further action. However, Duncan added that Camelot may choose to reopen the case at a later date.