Along with Jerry Colombo, Baker became one of the people who started working with Jerry Jacobson in his scheme. Per Daily Beast, Baker was recovering from a stroke of bad luck that started as far back as 1985, when the family lost their home, and had continued to the year 2000, when his real estate development company owed $30,000 in back taxes and he had damaged his spinal column in an accident that saw his tractor roll down a hill.
Once Jacobson got him involved, Baker sold his foster child George Chandler a winning game piece for $50,000 (after initially wanting $100,000). Then, in 2001 he gave a $1 million game piece to friend Ronald Hughey, followed by a $500,000 token to his wife Linda’s sister, Brenda Phenis. For this, she agreed to give Baker $90,000 and Jacobson $70,000.
However, per an affidavit (reported on in Greenville News) from when the case was eventually heard in court, Linda Baker was heard in an intercepted phone call telling Phenis that she would report the game piece as stolen if she did not give the Bakers the entire $500,000.
Baker had warned Phenis and Chandler not to get involved in any promotional activity around the win, but Chandler agreed to attend a giant check ceremony at a McDonald’s, which led to the FBI in Jacksonville investigating the wins. Despite the winners setting up fake addresses and phone numbers, the investigation soon uncovered that they all lived fairly close to each other in South Carolina. Per Greenville News writing contemporaneously, the FBI also intercepted calls of Linda discussing the fraud.
On August 21 2001, Baker and his wife Linda were among the first eight arrests in what the FBI were calling “Operation Final Answer,” alongside Phenis, Hughey, Jacobson and Michael Hoover, whose story was covered in the first episode of McMillions. All eight were charged with conspiracy to commit mail fraud, a charge with a maximum penalty of five years in prison and a $250,000 fine.
At the time of the arrest, District Attorney John Ashcroft said in a statement: “This fraud scheme denied McDonald’s customers a fair and equal chance of winning… Those involved in this type of corruption will find out that breaking the law is no game.”
After appearing in federal court this first time, they were sent to Spartanburg County Detention Center while awaiting their court case. The Bakers were then indicted on September 10, 2001, though the ensuing trial, in which they pled guilty, received little press coverage due to the events of September 11.
The Daily Beast reports that Baker said of this that if the FBI has spent more time investigating terrorists and less investigating his own case, 9/11 may have never happened.
At the end of this trial, the Bakers and Phenis had to serve probation, and per Daily Beast are paying back their winnings at a rate of $50 a month as of July 2018. Dwight Baker was also excommunicated from the Mormon church.
Chandler, meanwhile, eventually had his conviction overturned in 2004, with a circuit judge agreeing that he had been duped by the recruiters for the scheme. In that case, Circuit Judge James Clinkscales Hill said: “The government did not prove that the defendants committed mail fraud. Nor did the government prove a single mail fraud conspiracy, as alleged. Because the convictions in this case were predicated upon both of these trial errors, we must reverse.”
McMillions airs Mondays at 10 p.m. ET on HBO.
