The 89-year-old now lives a quiet life in a beach house on the island of Vanuatu.

Stefan Mandel, a Romanian economist and self-described “philosopher-mathematician,” was struggling to make ends meet in the early 1960s.

The ambitious young mathematician was desperate to increase his earnings and better his life.

A natural with numbers, Mandel spent every spare minute analysing theoretical probability papers written by the 13th-century mathematician Leonardo Fibonacci.

After years of research, he wrote a “number-picking algorithm” based on a method he dubbed 'combinatorial condensation.'

In an interview on YouTube, Mandel disclosed the story behind his huge financial coup. Here’s how it worked.

If a player picked 6 numbers in a 49-ball lottery, his odds of winning were 1 in 13,983,816. If he selected 15 numbers (which required purchasing 5,005 games — one for each possible combination), his odds of winning increased to 1 in 2,794. Mandel claimed that his algorithm could reduce these 5,005 combinations to just 569.

If the 6 winning numbers fell among his 15 picks, he’d be guaranteed to win at least a 2nd prize and hundreds of smaller prizes — and he’d have a 1 in 10 chance of winning the grand prize.

Miraculously (and with a lot of luck), he won the first prize of 72,783 lei (12,339.96). After expenses, he walked away with enough to bribe foreign ministry officials and flee Romania for a new life — and a bigger jackpot.

Mandel, now living in Australia, recruited the help of investors and a syndicate – named the International Lotto Fund or ILF.

This small group of collaborators banded together and bought 228 tickets each per draw.

After several modest wins, Mandel and the ILF turned their attention towards one lottery in particular.

The state lottery in Virginia offered several advantages.

It was fairly new, and allowed buyers to purchase tickets in unlimited quantities and print them at home. But most importantly, its numbers only ranged from 1 to 44 (other states went as high as 54).

This meant that with 6 picks, there were “only” 7,059,052 possible combinations, compared to the usual 25m+.

In a Melbourne warehouse, Mandel set up 30 computers and 12 laser printers, and hired 16 full-time employees to print millions of tickets pre-populated with every combination — a process that took 3 months.

He then shipped the one-tonne of paper weight to a point-person in the US at a cost of £46k.

With the tickets secured in Virginia, Mandel had to wait until the jackpot hit a number that would make financial sense after taxes.

A state lottery prize typically begins in the low millions and increases every time a drawing goes by with no winner.

When you see those insane £100m jackpots, it means nobody has won in quite some time. Mandel had to anticipate when to strike, and had to hope for the best that there wouldn’t be multiple winners to dilute the pot and ruin his margins.

On February 12, 1992, the Virginia Lottery jackpot hit £12.5m. Mandel’s team on the ground was given a simple directive: Go.

They won the jackpot, and because they had done every ticket imaginable, they scooped up £700k in additional prizes for the tickets which placed second, third, fourth and so on.

After the big win, Mandel's name was flagged by US authorities and 14 different international agencies ended up investigated him and the ILF – including the CIA and FBI – but both were cleared of any wrongdoing.

When the dust settled, each person who’d bought into the lottery through Mandel’s life insurance policy — small business owners, machine operators, housekeepers, and doctors — made out with around £1.3k.

Meanwhile, Mandel paid himself a one-time “consultant’s fee” of $1.7m and now lives out his days at a beach house on a remote tropical island in Vanuatu, a country off the coast of Australia.

He lives a quiet life and reports being “retired” from the lottery.

Quit while you're ahead I suppose!