Police probe in lottery scandal not over yet

The probe into Ontario's lottery system is continuing, as police investigate four other cases of possible fraud, some worth more than a $1 million.

The probe into Ontario's lottery system is continuing, as police investigate four other cases of possible fraud, some worth more than $1 million.

Ontario's embattled lottery agency faced another onslaught Wednesday after provincial police charged a former convenience store operator for allegedly cashing a stolen $5.7-million ticket as part of a larger probe stemming from the province's lottery scandal.

Lotteries across Canada have been under scrutiny ever since a scathing ombudsman's report blasted the Ontario Lottery and Gaming Corp. for not cracking down on retailers who collected tens of millions of dollars in jackpots between 1999 and 2006, some of them fraudulently.

Ombudsman Andre Marin's report in March prompted major changes at the Ontario agency in accordance with his recommendations.

The OLG tried Wednesday to put a positive spin on the scandal that has plagued the agency for the better part of a year by announcing that the four Toronto co-workers who claimed they were bilked of the $5.7-million prize in 2004 would receive the money after all— plus more than $788,000 in interest.

OLG officials even went through the traditional ceremony of handing over an oversized cheque, but instead of giving it to the four beaming lottery winners, the cheque was presented to their lawyer, Greg Harris, who helped the group bring the matter to the attention of the OLG in July.

Despite their ordeal, Lorraine Teicht, Paul Carlisi, Silvana Pincivero and Aurora Pincivero managed to provide the OLG with winner "testimonials"— gushy, exclamation-filled statements about what they planned to do with the cash, which included travel, a dream car and even buying a pearl necklace for Carlisi's cat.

Ontario Premier Dalton McGuinty said he was pleased that charges had been laid, adding that the OLG was acting on "each and every one" of Marin's 23 recommendations.

McGuinty said the charges send a clear signal to retailers of lottery tickets.

"We treat this as being very serious and you are going to be prosecuted in court."

Marin was more cautionary, reminding the OLG "to remain vigilant and not let its guard down" in protecting the public interest.

"No doubt the OLG has undergone important changes in the last few months, but culture change is not achieved overnight," Marin said in a statement Wednesday.

Don Edmonds, whose late father Bob challenged a $250,000 lottery win claimed by two retailers and was vindicated years later after a lengthy battle with the OLG, was more skeptical.

Police are investigating four other lottery-related cases which involve large amounts, in some cases more than $1 million, said provincial police Det.-Insp. Paul Beesley, the lead investigator.

Assets seized

Hafiz Malik, 60, of Mississauga, Ont., is facing two counts of fraud over $5,000 and one count of theft over $5,000, and was granted bail during a court appearance Wednesday.

In addition to the charges, about $5 million worth of Malik's assets have been seized or frozen by police, including a large house west of Toronto, bank and investment accounts, and three vehicles, Beesley said.

Police say the four Toronto co-workers purchased a Lotto 6-49 ticket in June 2004 at a retail outlet in central Ontario. Malik, who used to operate a small convenience store in Toronto's west end, is alleged to have claimed the $5,750,256 jackpot in January 2005.

The group realized something was amiss after checking the OLG website and noticing someone had claimed a June 2004 jackpot with their winning lottery numbers.

Believing they had enough evidence to prove they were the rightful winners, the group approached Harris, who advised them to take their complaint to the OLG. They did so in July, and the OLG subsequently informed police.

In October, the OLG completed its own internal investigation into the matter that confirmed the group's claim, but held off making an announcement because of the police investigation, said OLG CEO Kelly McDougald.

'The right thing for our customers'

"At OLG, we know that our first priority is to do the right thing for our customers and to earn your confidence each and every day," said McDougald, who was appointed in September after several key executives resigned from the agency around the time of Marin's report.

"Today, we feel we've accomplished that."

David Caplan, the minister in charge of Ontario's lottery system, said public confidence hasn't been shaken by the allegations of fraud since people continue to buy lottery tickets.

"The public should have full confidence that Ontario Lottery and Gaming is holding a fair game," Caplan said.

"If there are things that are suspicious, they will go to the appropriate authorities and have an investigation. It will be treated with the utmost seriousness."

Police began probing allegations of fraudulent lottery prize claims by retailers after Marin accused the corporation of "coddling" ticket sellers and playing "games" with customers who complained they had been cheated of their jackpots.

That is all changing, Caplan said. The lottery corporation is being overseen by the arm's-length Alcohol and Gaming Commission of Ontario, which will investigate all suspicious wins.

Starting Jan. 1, players across Canada will have to sign their lottery tickets before cashing them in, while retailers will have to undergo background checks and navigate a new set of rules in order to play the lottery.