A scathing report about dishonest retailers and lax controls at the Ontario Lottery Corporation has prompted calls for a police investigation and the resignation of the minister responsible.

Minister David Caplan wants the Ontario Provincial Police to probe deeper into allegations that lotto ticket sellers win a disproportionate number of prizes and the provincially-run corporation did little to stop it.

"I've instructed that all files, all information that the ombudsman reviewed, be turned over to the Ontario Provincial Police for their review, Caplan, the Minister of Public Infrastructure Renewal, said Monday.

It was a turbulent day for OLG. Ontario ombudsman Andre Marin released a scathing report into the allegations, saying that "confidence in our lotteries is shattered."

Marin found that at least 247 lottery retailers have made dishonest claims in the past eight years, resulting in millions of dollars of payouts. As this was happening, Marin said the "buddy-buddy" relationship between the corporation and retailers caused OLG to turn "a blind eye" to the allegations.

The ombudsman's report, titled "A Game of Trust," made 23 recommendations, including the creation of an external group to provide oversight for OLG. All the recommendations were accepted by the provincial government.

"I think the ombudsman quite rightly points out this is a flaw in the set-up of the corporation and the way it was originally put together and why he recommends we have an outside regulatory and adjudicator ability and process independent of the Ontario Lottery and Gaming Corporation," Caplan said Monday.

He added that he agrees with the ombudsman's assessment of OLG and the recommendations Marin made. Caplan added that he wants to quickly set up meetings between Marin and others to get the "proper regulatory regimes" in place.

Resignation calls

It is not enough for Caplan's rivals, who sought political blood on Tuesday.

Conservative Leader John Tory rejected Caplan's claim that he first learned about problems at OLG in October 2006, citing emails that reportedly Caplan's staff was informed six months earlier.

"I don't know how stupid this man thinks we are," Tory said.

"The notion that he doesn't talk to his senior staff, who are getting emails months before this was in the public domain; it's ridiculous. These people speak for him every day. Is he some sort of monk that sits in his office and doesn't talk to his staff?"

"I think he should go. How can anybody have confidence in the lottery system as long as he's ultimately in charge?"

Premier Dalton McGuinty defended his embattled cabinet minister, lashing back at the opposition saying they are playing political games.

"I understand the opposition is bringing their own particular, partisan perspective to bear on this issue, but I think what we're really after here is upholding the public interest," McGuinty said in Peterborough Tuesday.

"I think the appropriate thing to do in the circumstances is exactly what the minister did lately, which is turn over any information to the police."

Advertising campaign

Increasingly under the microscope of public scrutiny, the lottery corporation launched an extensive advertising campaign Tuesday morning.

In the campaign, OLG committed to follow Marin's recommendations, plus recommendations made in a KPMG review and audit of the corporation.

Finally, OLG said it will embrace "a corporate culture based on putting customers first while instilling our corporate values and operating philosophies in our employees."