Protestations and Issues surrounding the award of the license to operate the UK National Lottery
UK National lottery: Richard Desmond takes legal action over licence award
Billionaire follows Camelot in high court bids to overturn decision to let Czech firm Allwyn run draw
Fri 15 Apr 2022
Companies owned by the billionaire Richard Desmond have launched legal action against the UK’s gambling regulator’s decision to grant Czech-owned Allwyn the licence to run the National Lottery.
Desmond’s Northern & Shell and a subsidiary, the New Lottery Company, have taken legal action against the Gambling Commission, according to a high court filing dated 13 April – becoming the third party to challenge the award.
The commission announced Allwyn’s victory in the fourth competition for the highly lucrative National Lottery contract last month, putting an end to 27 years of unbroken operation by Camelot. Camelot made a net income of £730m in the year to March 2021 on revenues of £8.4bn from almost 10m players.
The current licence is scheduled to end in 2024, 30 years since the launch of the lottery in 1994.
However, Camelot, owned by a pension fund for Ontario teachers and its tech provider International Game Technology, have also launched high court actions to try to overturn the commission’s decision.
The competition was shrouded in secrecy, with code names used internally by the commission to prevent details of the judging process leaking.
Northern & Shell, which owns the Health Lottery, had not previously made its bid public, and there are no other publicly available details of the former porn baron’s procurement claim. The claimants are represented by law firm Bryan Cave Leighton Paisner, in a case first reported by the Financial Times.
Another bidder, Italian operator Sisal, which was bought during the competition by Paddy Power owner Flutter, is also considering joining Camelot’s action, according to the Sunday Telegraph.
The Gambling Commission declined to comment on Northern & Shell’s action. When Camelot announced its action on 1 April the commission said: “The competition and our evaluation have been carried out fairly and lawfully in accordance with our statutory duties, and we are confident that a court would come to that conclusion.”
Allwyn is ultimately owned by the Czech billionaire Karel Komárek, and it already runs lotteries in the Czech Republic, Greece, Cyprus, Italy, and Austria. It hired prominent British businessmen to run its bid, including Sir Keith Mills, who ran London’s winning bid for the 2012 Olympic Games, and former Sainsbury’s boss Justin King.
After winning the contract competition, Allwyn said it planned “to generate more money for good causes and the public purse” as well as stopping the “slide towards scratchcards and instant win games, giving due consideration to the wider societal impact these can have”.
It also said Camelot employees would “all be welcome to join us”. Camelot employs 1,000 people in Watford.
Allwyn and Northern & Shell were approached for comment.
Northern & Shell joins Camelot challenge of UK National Lottery tender
April 19, 2022
Northern & Shell Plc, the publishing group of Richard Desmond, will appeal the UK Gambling Commission’s (UKGC) decision to award the 4th National Lottery operating contract to Allwyn Group.
According to a Financial Times report, Northern & Shell will join ousted incumbent Camelot UK in launching a High Court appeal against the UKGC’s decision to appoint Allwyn as National Lottery steward, effective 2024.
Under its subsidiary ‘the New Lottery Company’, Northern & Shell had participated in the UKGC’s tender competition.
Company founder and chairman Richard Desmond has been a long-standing critic of Camelot as the operating steward of the National Lottery for the past 30-years.
Yet circumstances have prompted Northern & Shell and Camelot to join forces to overturn the UKGC’s decision in the hope that the competition will be replayed.
Camelot seeks answers as to why its bid was rejected, having scored the highest ‘scorecard results’ during the competition’s evaluation phase of participants.
Furthermore, Camelot has demanded that UKGC disclose whether it changed any rules and conditions related to how participant bids were evaluated.
Standing by its result and judgement, the Commission outlined that from start-to-finish, it had applied every measure possible to ensure a level playing field for all competing parties.
In response to Camelot’s appeal, the UKGC maintains that the competition was a ‘fair, open and robust’ process, with Allwyn coming out on top due to its commitment to good causes and the growth of the National Lottery.
Of significance, Allwyn had pledged £38bn to help good causes over the 10-year contract, whilst Camelot has only raised £45bn since the National Lottery’s inception in 1994, raising concerns over the validity of the preferred applicant’s claims.
Allwyn has also recently courted criticism over alleged links between its chairman and founder, Karel Komarek, and Russian energy supplier Gazprom, amid Russia’s ongoing invasion of Ukraine.
Defending itself against Camelot’s legal appeal earlier this month, a UKGC statement read: “The competition and our evaluation have been carried out fairly and lawfully in accordance with our statutory duties, and we are confident that a court would come to that conclusion.”
Man presiding over award of licence to run UK lottery to Czech billionaire has extensive links to Russia
17 April 2022
The man presiding over the award of a licence to run the lottery to a Czech billionaire has extensive links to Russia, The Mail on Sunday can reveal.
Veteran money manager Stephen Cohen chairs the National Lottery Competition Committee which last month handed the licence to Allwyn Entertainment, founded by Czech oil and gas tycoon Karel Komarek.
An investigation by the MoS found that Cohen spent years helping channel foreign investment into Russia and even worked for one of Putin's former ministers.
From 2005 to 2008, Cohen ran the hedge fund arm of Troika Dialog, once described as the 'Kremlin's preferred investment bank'. It was a period when its investments included Russian state energy giant Gazprom, which has also done business with Allwyn.
Cohen worked under Andrey Sharonov, Putin's former deputy economic minister. Troika moved the management of the Cayman Islands-registered fund from London to Moscow after he left.
Komarek has condemned Vladimir Putin's invasion of Ukraine, but questions over his business ties to Russia have been asked in Parliament.
His company MND in 2016 built a gas storage facility in the Czech Republic with Gazprom. Komarek's group also owns a stake in a gas terminal in Russia.
Cohen, who sits on the Gambling Commission regulatory body, was also a director of financial intermediary EG Capital Advisors for four years until 2021. EG is controlled by Igor and Alexander Mints, the children of exiled Russian billionaire Boris Mints.
Cohen's official Gambling Commission biography makes no reference to his extensive links to Russia and they were omitted from the Government announcement of his reappointment in 2020. His LinkedIn page makes no mention of Russia.
Existing lottery operator Camelot, as well as Richard Desmond's Norhern & Shell group, are taking the Gambling Commission to court. Italian bidder Sisal may follow suit. MPs said the links raised questions over Cohen's Russian connections.
Sir Iain Duncan Smith, who is vice-chairman of the All-Party Parliamentary Group for GamblingRelated Harm, said:
'This is such a big decision, all of this must be completely above board, particularly as the decision is being challenged and given the company awarded the licence has its owns links to Russia.
'This is important given what has been happening politically in Russia for a long time. I'm surprised to find the chairman of the committee has Russian connections that are not declared.'
Tory MP Dean Russell said: 'This is one of the biggest contracts the Government will award. We need complete confidence in the decision and those who are making it. The process must be seen to be beyond reproach.'
The process to award a new ten-year licence began in 2020. The Gambling Commission said it listed Cohen's potential conflict of interest through the EG Capital job online until 2021 when he left the role.
A Gambling Commission spokesman said Allwyn's victory 'followed a fair, open and robust competition which received four applications.
'Throughout the application and decision process, information regarding applicants was anonymised, even during the final decision-making process by the board, meaning a fair and transparent process was in place to only identify the application that best meets the needs of the National Lottery.'
Allwyn, previously known as Sazka, runs lotteries in Austria, Italy and Greece, and plans to cut the cost of UK tickets from £2 to £1 when it takes over in 2024.
UK National Lottery Is All-Time High in Ireland
April 19, 2022
The UK is undoubtedly the hub of gambling with a large section of 2.1 million regular customers, enjoying the thrill of gambling and contributing a Gross Gambling Yield (GGY) of 14.12bn annually. Furthermore, the setting up of the UK National Lottery, which is state-franchised with a legal license in 1933 lured even more customers. Currently, the UK National Lottery is operated by the Camelot Group.
Recently, the Camelot UK Lotteries registered itself as the largest channel, with an average sale of all its products an increase of 2.34bn Euros, or a 4.5% increase over previous years. Furthermore, they earned a soaring half-yearly income of 3.96 billion in the financial year 2021-2022. Right from 1 April 2021, the half-yearly total sales are calculated at 107.3 million, or approximately 2.7% higher than in previous years.
The UK earns an average of 650 million on sports betting daily, which is higher than any other nation in the world. But the current year comes with record-breaking sales of online betting and draw-based games from the UK National Lottery according to DatingCelebs. In fact, the ‘National Lottery Scratch Cards’, as well as ‘instant win games’ gained huge popularity, and the sales increased dramatically to 1.73 billion Euros or an average increase of 1.6%.
Why is the UK National Lottery so high?
Soaring up huge income without any prior setting and luck is simply not the case for the National Lottery Sales. The largest contributing factor could be the innovations made on the ‘rolldown feature’. Had more players chosen the EuroMillions rollovers, statistics of income would have swelled up even more. Nevertheless, the ‘must be won’ draws more attraction from the GamStop customers that are based in Ireland and follow CasinoGap offers, as it comes with assured jackpots for all the winners.
The Camelot Group has undergone an overwhelming expansion in the first 6 months of the current financial year, by ransoming partnerships with leading supermarkets, such as Aldi and Iceland. This clearly implies that customers could avail themselves of checkouts of all UK National Lottery incentives all across 1900 stores.
Online shopping too comes in handy in such a case, as the recorded growth of Camelot could be witnessed by means of 795,000 new registrations in just six months. The mobile sales accounted for an increase of 1.5bn, or 1.8% of an average, compared to all-time sales.
The recent pandemic, responsible for shutting down several casinos, bookshops, etc. brought with it a boon to the UK National Lottery, which suddenly soared its digital sales by 1.62 bn Euros. The Camelot Group has also been very vocal about its funding and social welfare help, because of which it attained a positive image in the eyes of its customers. During the first Covid-19 lockdown, the UK National Lottery aided the victims and gave out an average of relief.
The 2021 Tokyo Olympics, which happened around this time has also proved highly fruitful for the UK National Lottery, as well as its potential customers since it led to a new hype for casino games. Nigel Railton, Camelot’s chief executive, confirmed that several high-profile customers, playing for the National Lottery, added a large section of their incomes for Paralympic and Olympic training purposes. The Scratchcards for the Olympic Lottery were brought up around July 27, 2005, with the interesting brand name ‘Go for Gold’. Furthermore, the London Summer Olympics of 2012 was a great success too. It is speculated that the National Lottery and the Olympic Lottery Distribution Fund raised a huge ransom of 750,000,000 Euros, which was a great help in covering all the costs of the game.
Welfare Programmes and Prizes
Around 2.7bn Euros were handed out to the players as cash money, within a period of just six months. This huge money is at least 30.6m Euros higher than in the preceding years. What is even more shocking is bringing in approximately 184 new millionaires.
Even after the money allotted for prizes, approximately 884.5m Euros is handed over for Good Causes. Since 1994, there has been an initiative with the urge of helping the local citizens, such as giving food and shelter, providing clothes to the needy, etc. Currently, about 45.0bn Euros have been allotted for the Good Causes.
Nigel Railton, Camelot’s chief executive, proudly boasts about the huge demand for the Lotto barometer and the high rise in sales. The National Lottery is all-time high and comes with excellent services. Camelot comes with new enhancements, and improvisation to make the National Lottery a more thrilling experience.
They also calculate their profits and extra expenditure from the prize budget. For example, 1% of the prize money is always retained as profits, while 4% of the ransomed cash goes to operating causes. Several projects under the Good Causes also attract a large section of players, who wish to contribute their bit to social affairs. However, the current years have proved to be even more profitable for the National Lottery due to the lockdowns, where players can enjoy the gaming experience right at their fingertips.
Gambling Commission grabs £155million from UK National Lottery ticket sales meant for charities
The gambling regulator awarded itself the funds to cover admin costs
It is £50m more than budgeted and money which should have been used to support cash-starved charities and community groups
Andrew Rhodes, commission's chief executive, admitted it has taken £154.8m that will be used to regulate the lottery for the next ten years
He said it will also pay for the recent bidding process which will see a Czech billionaire take over contract from Camelot
, 9 April 2022
The Gambling Commission has pocketed £155 million from National Lottery ticket sales that was meant for good causes, The Mail on Sunday can reveal.
In a raid that critics have branded appalling, the gambling regulator awarded itself the funds to cover administration costs – £50 million more than budgeted and money which should have been used to support cash-starved charities and community groups.
Andrew Rhodes, the commission's chief executive, has admitted it has taken £154.8 million that will be used to regulate the lottery for the next ten years, as well as paying for the recent bidding process which will see a Czech billionaire take over the contract from Camelot.
Last night Sir Iain Duncan Smith, vice-chairman of the All-Party Parliamentary Group for Gambling-Related Harm, blasted the cash grab.
He said: 'This is another example of the appalling way the lottery is run. The proportion of funds going to good causes has plummeted.'
In a letter to Dame Meg Hillier, who chairs the Commons Public Accounts Committee, Mr Rhodes reveals the costs to license and regulate the lottery spiralled to £154.8 million – more than £50 million above the initial budget of £102.9 million.
He said that the vast sum was being drawn down from the charity funds raised by National Lottery players, but insisted it accounted for just 0.7 per cent of the more than £14.5 billion saved for good causes.