Lotteries facing more scrutiny
SHANNON KARI

From Wednesday's Globe and Mail

TORONTO — The Ontario Lottery and Gaming Corporation is facing new allegations that fraudulent wins by lottery ticket sellers may be more widespread than it is willing to admit, including a $12.5-million jackpot that was awarded despite the suspicions of internal investigators.

The lottery corporation has insisted that the case of Bob Edmonds, an 82-year-old Coboconk resident defrauded out of a $250,000 prize by a store clerk, was an isolated event.

But internal lottery corporation documents obtained by the CBC program the fifth estate for a broadcast tonight reveal that the lottery corporation investigated four $250,000 wins by ticket sellers between November, 2002, and December, 2003, as well as the $12.5-million jackpot.

In one of the cases, a clerk in Orillia pleaded guilty to fraud. The documents say that in the other four investigations, including the $12.5-million prize that originated from a Super 7 ticket bought in St. Catharines, Ont., in December, 2003, the lottery corporation eventually awarded the prizes to the retailers.

Related to this article
Follow this writer
Add SHANNON KARI to my e-mail alerts
Latest Comments
The easiest way to protect yourself against fraud is to sign...
For those who want a break down on Tim hortons Roll Up The Rim...
Blasphemous! Here here, David Pollack. I don't buy'em either...
I see, instead of paying Mr Edmonds $250,000 and getting the...
20 reader comments | Join the conversation
In about a month, the provincial Ombudsman is supposed to release the results of his investigation into the lottery corporation and how it protects the public from fraud.

Since the fifth estate broadcast its first program last fall about Mr. Edmonds and the unusually high number of insiders winning lottery and instant scratch tickets, the lottery corporation has instituted new security measures. They include the installation of more than 1,800 self-serve "ticket checkers" and requirements that retailers have customers sign the back of tickets before they validate them.

After the bad publicity last fall, the lottery corporation retained outside public relations consultants. Chief executive officer Duncan Brown was instructed to appear proactive and "confident yet humble," in media interviews, according to this week's the fifth estate report.

While the lottery corporation is investigating every insider win of more than $10,000, e-mails between lottery corporation officials show that, as recently as last May, it had planned to institute a new policy that ticket sellers would no longer be categorized as insiders.

"The Ontario Lottery Corporation has known for a long time that it has a serious problem with so-called insider wins," said fifth estate producer Harvey Cashore. "What is not clear is why they planned to remove retailers from their insider-win policy. How would that help the problem?"

A spokesman for the lottery corporation said it is not going to make any further statements about its insider-win policy until the release of the Ombudsman's report.

Jim Cronin, director of public affairs, also declined to comment on the cost of the outside public relations agency or its legal bills in defending itself in Mr. Edmonds's lawsuit.

Information disclosed under the provincial Freedom of Information Act indicates that the lottery corporation has paid the Toronto law firm of Cassels Brock nearly $600,000 in connection with the Edmonds case. More than $165,000 of that total has been billed since the lottery corporation reached an out-of-court settlement with Mr. Edmonds in the spring of 2005.

Criminal charges against the Coboconk store clerk were stayed in the fall of 2004 after she and her husband agreed to pay Mr. Edmonds $150,000.

The program to be broadcast by the fifth estate tonight also raises questions about the Ontario Provincial Police and why the force did not execute a search warrant against the lottery corporation that was requested by the constable investigating the clerk and her husband. The officer wanted to search the computers of some lottery corporation officials in August, 2004, who he suspected of allegedly obstructing the police investigation.

The OPP has confirmed that a warrant was drafted, but never approved by the constable's supervisors.

The OPP conducted a review of why the request for the search warrant was not approved. Inspector Dave Ross said yesterday that the Crown and the supervising OPP officer decided at the time that a further search of the lottery corporation's records was not needed.

Special to The Globe and Mail