Ont. ombudsman gives OLG extension on insider wins

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Ontario's ombudsman has given the Ontario Lottery and Gaming Corp. another 30 days to report back to him on its efforts to control so-called insider lottery wins.

Six months ago, Andre Marin gave the Ontario Lottery and Gaming Corp. a six-month deadline.

If he doesn't like what they do, Marin has said he would recommend that retailers and OLG employees be barred from playing OLG games.

"Insiders are in purgatory," he said Feb. 5 in a news release. "If they prove to be an ungovernable lot, they shouldn't be allowed to play."

Earlier that month, the OLG issued a report, prepared by the Deloitte accounting firm, which found insider wins accounted for $198 million in payouts for the period from 1995 to 2008.

That is about what it costs to run an Ontario hospital, he said.

Marin also said that's about double the OLG's previous estimates.

The ombudsman said he considers the figure to be "conservative" and "very suspect." He is worried that fraud is still happening despite measures undertaken since a 2007 report by his office.

Watching over insiders cost the OLG about $3 million per year. The OLG has broadened its definition of insiders to include retailers' employees and family members.

The corporation spent $750,000 on the Deloitte report and previously spent $640,000 on an earlier study by KPMG.

However, Marin also said he thought the OLG is now on the right track, crediting it with accepting and implementing recommendations made in 2007.

Here are some of the changes:

the Alcohol and Gaming Commission of Ontario now regulates the lottery system and reviews all insider wins
Retailers must be registered and are subject to a code of conduct
there are "secret shopper" investigations to ensure that the rules are being followed

Marin also noted the following: