Former Washington State Employee Sentenced for Embezzling Nearly $900K to Fuel Gambling Habit

A former Washington state employee has been sentenced to 18 months in federal prison for embezzling about $878,000 from the Washington State Office of Administrative Hearings (OAH), in what prosecutors described as the state’s most significant insider theft in 15 years.

According to the United States Department of Justice press release, Matthew Randall Ping, 48, of Olympia, pleaded guilty in June to wire fraud and filing a false tax return. Following his prison term, Ping will serve three years of supervised release. He will also pay more than $1.1 million in restitution to the State of Washington, its insurer, and the Internal Revenue Service (IRS).

How the Scheme Worked

Ping joined the OAH in 2009 and by 2017, was promoted to Management Analyst and credit card custodian. The role gave him access to internal vendor payment systems. From 2019 to 2023, he embezzled $878,115 from the state agency.

Ping created fake vendor accounts to mimic legitimate contracts. Between 2019 and 2021, he charged over $330,000 through OAH credit cards. Between 2021 and 2023, he siphoned another $530,000 using new payment processor accounts. He also used the OAH credit cards to make $17,359 in personal purchases from Verizon and Walmart.

Investigators said Ping would upload his fraudulent charges and “upload and approve payment himself without the required oversight on his fraudulent transactions. He also took steps to manipulate the accounting data to make it more difficult to determine that he had violated protocol by uploading, reviewing, and approving his own transactions.”

The scheme came to light in 2023 during a review by the Washington State Auditor’s Office. Ping resigned shortly after. The investigation involved the Federal Bureau of Investigation (FBI), the IRS Criminal Investigation Division, and the auditor’s office.

Gambling Addiction Cited as Motive

Assistant United States Attorney Dane Westermeyer initially requested a 33-month sentence. He cited as reasons that Ping had gambled away a significant portion of the stolen money.

“He used this stolen taxpayer money to fuel his gambling habit, fund at least six trips to Las Vegas, pay off a luxury vehicle loan, and otherwise support his lifestyle. And, perhaps not surprisingly, he failed to report any of the income from his theft on his federal tax returns, which resulted in a tax loss of nearly $250,000,” Westermeyer wrote in his sentencing memo.

At sentencing, Tiffany M. Cartwright, U.S. District Judge for the United States District Court for the Western District of Washington, acknowledged Ping’s addiction while stressing the seriousness of his crimes.

“Your crime was very serious, but was driven by severe addiction…. Gambling addiction can destroy the life of someone who is otherwise an upstanding citizen,” Cartwright said, according to the DOJ.

Teal Luthy Miller, Acting U.S. Attorney for the United States Attorney’s Office for the Western District of Washington, said Ping’s theft was “the largest insider embezzlement from Washington State in the last 15 years.” Miller added that it betrayed taxpayer trust.

Similar Gambling-Linked Fraud Cases

Ping’s case is part of a broader pattern of high-stakes fraud resulting from gambling addiction or debts.

Earlier this year in Texas, authorities charged a former oil-field equipment company controller with first-degree felony for stealing roughly $683,000 from his former employer. He would take small amounts at first and win the money back. However, he would end up in deeper debt, necessitating the need for more money.

In another case, federal prosecutors in New York accused a former Wall Street executive of misappropriating nearly $4 million from investors in a crypto-casino startup. Investigators say he secretly transferred company funds to cryptocurrency wallets. He also placed bets and gambled at online casinos while misleading investors about the extent of his losses. He faces charges of securities and wire fraud.

One of the highest-profile cases involved MLB star Shohei Ohtani’s former interpreter, Ippei Mizuhara. He received 57 months in prison for stealing about $17 million from Ohtani to repay illegal gambling debts. Mizuhara amassed about $40 million in debt to illegal bookmakers.

These cases showcase how gambling addiction can drive people in financial positions to exploit their access to large sums of money. Instead, such schemes tend to spiral out of control until they collapse under their own weight.