Maltco objects to MaltaToday report on Illinois probity

Maltco lotteries has objected to a report by MaltaToday's report last Sunday that quoted details from a probity investigation led by Kroll Associates, a Chicago-based investigations firm, which uncovered numerous criminal indictments brought against mother company Intralot SA, the world's second-biggest gambling services provider.

In a reply sent to this paper, Maltco alleged that the article published by MaltaToday was "defamatory and unsubstantiated."

Maltco accused the paper of having "ulterior motives" in publishing the article as the company currently is involved in court proceedings to obtain a court injunction against a government call for tenders on the operation of the national lottery.

Released under the US Freedom of Information Act, the Kroll report undertook limited probity investigations into the backgrounds, history and business practices of gaming companies that expressed interest for the selection of private lottery manager in the State of Illinois, in the United States.

Intralot was one of three bidders on the lucrative State of Illinois contract to privately manage the lottery with the goal of increasing sales and revenue for the state. The others were Camelot Illinois and Northstar Lottery Group, a consortium of Gtech, Scientific Games and Energy BBDO.

Investigators alleged that Intralot failed to disclose the ownership interests of two key people: Socrates Kokkalis and Constantinos Antonopoulos in the company. Both had been indicted for criminal offences in the past, although the report also noted they were acquitted, mostly because the charges were time-barred.

But in its defence, Malto said there was neither a conviction nor an indictment for a felony against Intralot, and added that the same allegations had appeared in 2002 when Intralot was the preferred bidder in the privatisation process for the awarding of the national lottery license and the company provided all the necessary explanations to the Maltese authorities that were responsible for the tender.

"The reality is that the privatisation of the national lottery games, which Maltco was awarded in 2004, is a success story from which all stakeholders namely the Government, the Lotteries & Gaming Authority, the Lotto Receivers, the players, the company and its employees benefitted," Maltco said.

On the Illinois privatisation process, Maltco said that Intralot was not disqualified for probity reasons, but due to unequal treatment.

"In July 2011, the Illinois Independent Auditor General, Bill Holland, announced that the process used by the Illinois Department of Revenue was flawed, while the motives for requesting a probity report from Kroll Associates were questioned.  Intralot has since filed a law suit for defamation and unequal treatment which is pending," it said.

The company added that during the past nine years, Intralot has been awarded lottery contracts in 11 different US States, while in October 2011 the company undertook one of the largest-scale projects in the US, to provide the VLTs monitoring system in the Ohio Lottery, which is the twelfth largest lottery in the US.

"Contrary to the report, Intralot has provided the lottery system and participates to the South African National Lottery, Gidani, which holds a valid license that was granted following thorough probity checks that included Intralot, its shareholders and management," it said.

In its reply, Maltco said that Intralot also has a very profitable operation in Bulgaria, while recently, in September 2011, it has added another major project in its portfolio in Australia, to provide the VLTs monitoring system to the Government of Victoria. Intralot holds also a license to operate lottery games in Victoria and in Tasmania and has a successful contract with LotteryWest in Western Australia.