Nfld. & Labrador

Amid layoffs, Atlantic lottery head says $100M in business lost to offshore gambling sites

On the heels of layoffs, the Atlantic Lottery Corporation estimates it's losing $100 million to unregulated websites.

ALC estimates $100M is lost to unregulated websites

The Atlantic Lottery Corporation is shifting its focus to a digital platform to try to prevent revenue from going to unregulated offshore sites. (CBC)

The president and CEO of the Atlantic Lottery Corporation says it's struggling to compete with unregulated, offshore digital gambling, and is hopes a shift in focus to online gaming will prevent an estimated $100 million in annual revenue from leaving Atlantic Canada

Chris Keevill told CBC Radio's On The Go on Thursday that offshore gambling providers have taken advantage of the COVID-19 pandemic to acquire more customers.. 

"We think that there's at least a 20 per cent increase on an annualized basis with that number, and maybe more. So it's a problem and it's getting worse," he said.

The Atlantic Lottery Corporation let go of 61 employees on Wednesday, citing business challenges requiring the organization to "urgently transform."

But the move to a digital platform isn't without its own challenges, said Keevill, who added the competition from hundreds of offshore gaming platforms — which are illegal in Canada — is tough.

What's more, Keevill said, the unregulated platforms are unsafe for players. 

Keevill said the ALC felt an obligation to the Atlantic provinces to restructure in light of these challenges because the proceeds that go back into Atlantic provinces are now "under threat."

Unregulated sites 

Keevill said some jurisdictions allow the hosting of offshore gaming platforms, most of them in Gibraltar, the Isle of Man, some Caribbean countries and some areas of Central and South America.

He said those companies are able to market themselves through digital channels and sometimes television, offering free registration and free-to-play games. 

Chris Keevill says the competition from unregulated offshore sites is fierce. (Atlantic Lottery Corporation)

"But once they've got you for free, registered online, then they can market to you directly, to drop your credit card or set up a funded account so that the money moves offshore," Keevill said.

"There's no certainty that the play is fair, as an example. There's no certainty that the money is going to come back to you when you want it to come back to you. There's no regulation or oversight."

Keevill said the ALC, through all of its products, wants to promote safe and responsible gambling, which he said is not a concern for offshore sites.

"They have no incentive to do that, because they're not part of this community," Keevill said. 

"And it's the simple problem that $100 million is leaving Atlantic Canada and it's not coming back."

Pandemic role in restructuring

Keevill said the ALC's business has been affected by the ongoing COVID-19 pandemic. 

"Our challenges are not unlike a lot of other businesses in Atlantic Canada. There's a digital transformation that is hitting a lot of industries, and that digital transformation is moving customers from traditional ways of buying goods and services to buying online," Keevill said. 

"That change is upon us in the lottery business as players look to buy their tickets and play their games through our website."

The ALC laid off 43 people in New Brunswick, seven in Newfoundland and Labrador, seven in Nova Scotia and four in Prince Edward Island.

Read more from CBC Newfoundland and Labrador

With files from On The Go

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