Richard Branson's "The People's Lottery" appears to be a lock for landing seven year operational rights to the world's largest lottery, the U.K. National Lottery. The National Lottery Commission announced yesterday that it has failed to reach a decision on whether it will be the current operator, Camelot, or The People's Lottery, although Camelot has been dropped from consideration. The People's Lottery application didn't meet statutory criteria, but the group has been given a month to work out the kinks.
"Both bids have many merits," Chairwoman Dame Helena Shovelton said yesterday during a
press conference to announce the commission's decision. "We met the bidders and gave them every
chance to make improvements to their applications. But, they also had important failings. We are disappointed about that, but we would fail in our statutory duty if we granted a seven-year licence based on either bid in its present form."
Camelot lost its bid due to concerns about the conduct by officials from equipment supplier GTECH. Earlier this year, it was revealed that a minor technical glitch caused a miscalculation of prize payments over several years. Top GTECH officials hid the problem from Camelot officials until a former employee informed the Commission about the glitch, which had been fixed in 1998. As a result Chairman/CEO William Y. O'Connor and President/COO Steven Nowick, the two officials blamed for keeping news about the problem from Camelot, both stepped down, but the Commission determined that "the integrity of the lottery was compromised." A report detailing the Commission's investigation is due next month.
"We are extremely disappointed by today's developments and will continue to cooperate fully with Camelot and the NLC. We are going to review today's decision closely, and will not have any further comment at this time," said W. Bruce Turner, chairman of GTECH's Board of Directors. "Current GTECH
customers will continue to receive full service in keeping with all of our customers' contract requirements." GTECH officials, whose contract with the Lottery runs through September 2001, has since made several corrective actions to ensure their future integrity.