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INTEGRITY & SECURITY UPDATE

Tuesday, October 2, 2007

In October 2006, the gambling industry received a wake-up call; lottery retailers were winning more times than would be statistically expected. In response, the Nova Scotia Gaming Corporation (NSGC) acted immediately, launching an internal review of our ticket lottery operator’s, the Atlantic Lottery Corporation (ALC), policies and procedures. We also called in Dr. Jeffrey Rosenthal, leading Canadian statistician, to find out if more retailers were winning in Nova Scotia than would be expected. His analysis confirmed that there were statistically higher winnings occurring in the retailer group. To address this, we have led several key initiatives, working with ALC to leave no stone unturned in restoring integrity and security in Nova Scotia’s lottery system.

Our response has been proactive at every juncture. Over the past several months, we have:

  • Turned all customer complaint files related to retailer wins over to the RCMP to determine whether any further investigation was warranted, including criminal investigations. This review has not yet concluded.
  • Led the introduction of a Broad Scope Review into all aspects of ALC’s business. The review, being conducted by KPMG, will look at controls, operational procedures, as well as management practices. Led by NSGC, the other three Atlantic Provinces are also participating in this review. The results of this review are scheduled for Winter 2008.
  • Implemented self-ticket checkers in all ticket lottery retail locations across Nova Scotia. This is a key step in giving consumers control over their own tickets.
  • Proceeding to fill several positions in NSGC’s gaming operations unit to expand NSGC’s role into audit, monitoring and compliance reviews of our operators’ businesses.
  • Commissioned an independent review of NSGC’s corporate policies and procedures to align our efforts in ensuring the industry has the proper oversight and monitoring functions.
  • Collaborated with ALC in the development of its Way to Play customer awareness campaign.