March 6, 2003 – Interviews and e-mail exchanges with prominent people in the lottery industry from Washington, D.C., to Australia find them not only aware of but also "concerned" across the board about the secrecy with which the V.I. Lottery handles its finances.
Charles Strutt is the director of the Multi-State Lottery Association, the Iowa-based organization known as MUSL that promotes the big-ticket Powerball game, a recent addition to the lottery offerings in the Virgin Islands. He visited the territory last year when Powerball was introduced.
Asked by the Source to provide sales figures for the territory, Strutt declined to do so. But he did call the V.I. Lottery headquarters from his mainland office to encourage Virgin Islands officials to disclose the Powerball sales volume, which is a matter of public record everywhere else the game is played.
Strutt subsequently told the Source that the V.I. authorities had "indicated that they do not have any issues with releasing sales information."
A spokesman for a mainland lottery trade publication, who asked that it not be identified, said personnel there have been "following with concern the events in the USVI" having to do with secrecy in lottery operations. But he added that the publication has no intention of writing about the subject, as "you can appreciate that as a trade journal we have to be very cautious in approaching situations like this."
That trade paper spokesman suggested that an Australian publication, Lottery Insider, might react differently to queries. It did.
"We are talking with some lottery agents in the V.I.," its editor, Ernie O'Keefe, wrote in an e-mail exchange. "We have also scheduled an interview with one of the lawmakers who is very critical of the way the lottery has been operating."
The Australian publication editor also volunteered that he had been following reports on the matter published by the Source. (See "V.I. Lottery unique in not disclosing finances".)
Following up on Strutt's suggestion that contact be made directly either with V.I. Lottery officials or with the governor's legal counsel, Paul Gimenez, the Source this week did just that.
Gimenez e-mailed back that "I will contact the lottery and ask that they respond to your inquiry."
But despite the interventions of the Powerball executive and the Government House lawyer, no response was forthcoming from the V.I. Lottery.
If total Powerball sales or even all V.I. Lottery sales are released publicly, this will be only part of the story. The other critical question is: How much of the gross sales goes into the territory's General Fund?
The standard for state lottery operations on the mainland is not only that finances are revealed in detail, but that on average 35 percent of lottery gross proceeds go to the public treasury. For Powerball, the average is 31 percent; for the Virgin Islands, apparently it is about 2.6 percent.(See "V.I. Powerball percentage far below U.S. average".)
Sen. Adlah "Foncie" Donastorg chairs the Senate Finance Committee, which is undertaking an audit of the V.I. Lottery When he and a member of the Legislature's post audit staff went to the lottery offices on St Thomas last week seeking to examine financial records, they were turned away on orders of Gimenez and Attorney General Iver Stridiron.
This week, Stridiron said the Finance Committee does have authority to audit the V.I. Lottery but the problem was that the senator had not property notified lottery officials of his wish to examine the records.
Also this week, Donastorg in letters to Stridiron and Gov. Charles W. Turnbull took issue with the definition of "gross revenues" that he said appears in the government's contract with Caribbean Lotto Inc. He said the contract provides for the government to receive 10 percent of gross sales proceeds "after deducting the cost of free tickets issued as a part of the lottery games and the commissions retained by the selling agents."

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