Washington Attorney General Preparing to Probe Intralot for Mismanaging Betting Platform
Date: 2024-08-12 Author: Alex Crawford Categories: EVENTS
According to the Washington City Paper, the results of the request will determine the next steps for Schwalb’s office. If violations of the law are found, Intralot could be fined. Moreover, the attorney general’s office could order the company to comply with a compliance plan or bar it from doing business with the city.
Intralot’s most recent lottery and sports betting contract expired on July 15. The city did not renew the betting agreement, but the DC Council approved a one-year, $39 million contract for lottery systems services. The Office of Lottery and Gaming (OLG) had originally requested a two-year contract extension to include sports betting.
In 2018-2019, the Washington City Council debated and ultimately legalized retail and digital sports betting in the nation’s capital. The decision was made to hand over the sports betting contract to Intralot, which already had a lottery contract with the city.
At the time, suspicions arose that Council Chairman Jack Evans had coerced his colleagues into approving the sole-vendor model. There were also questions about subcontractors associated with council members. Evans eventually resigned and became the subject of an ethics investigation. Earlier this year, he was appointed to the city’s arts commission.
GamBetDC, FanDuel, and New Players in the Market
Intralot launched the GamBetDC platform, which was a failure in both profitability and usability. Among the many problems was a site outage during the 2022 Super Bowl.
In March, the Office of Lottery and Gaming announced that FanDuel would replace GamBetDC as the only available platform citywide. However, FanDuel’s partnership with Intralot lasted only three months. In June, the City Council budgeted an open competitive betting market.
In July, BetMGM and Caesars Sportsbook, which already offer digital betting in two-block zones around sports arenas, began offering their platforms throughout the county. At the time, FanDuel stopped operating through the lottery, as its contract with Intralot expired. FanDuel soon relaunched through a partnership with Audi Field.
DraftKings is expected to launch a partnership with DC United and Audi Field later this year. Fanatics Sportsbook is also coming to the market, having expressed interest in several hearings.
Intralot Continues to Operate the County Lottery
Intralot remains the city’s partner in operating the lottery, and some GamBetDC terminals are still operating in the county. However, Schwalb’s office has requested documents related to Intralot’s sports betting activities, as stated in a court document dated July 22. That document, as well as the materials the company provided, are sealed.
Washington’s sports betting law is unique because it created a monopoly for Intralot and required operators to comply with rules regarding minority- and women-owned businesses. Specifically, Intralot pledged $215 million for these purposes, but has yet to deliver on that promise, as noted by the city auditor in 2021.
Veteran’s Services Corporation’s Troubles
Veteran’s Services Corporation (VSC), led by Washington insider Emmanuel Bailey, has also come under scrutiny. In June, the company launched the “LetsBetMD” platform in neighboring Maryland, which offered worse odds and used “free bet” language banned in several U.S. jurisdictions.
Intralot has tried to distance itself from VSC, arguing that the company failed to meet its obligations. However, the city continues to do business with VSC.
