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Investigations put national lottery bids in doubt

TWO OF the US groups brought in to help leading bidders for the multi-billion pound national lottery are under investigation by US and Australian authorities over possible irregularities in securing lottery contracts.

GTECH, the US computer group that has joined with such blue-chip companies as Cadbury Schweppes and De La Rue in the Camelot consortium bidding for the lottery, is facing investigations in New York state and Maryland over recently won lottery contracts. In California, it has been caught up in a bribery scandal involving a state senator.

In addition, the parent company of Automated Wagering International, which has been signed up to help the Great British Lottery Company and Rank Organisation in their bids, has had a contract for lottery supplies to the Australian state of Victoria suspended because of alleged bidding irregularities.

GTECH has been caught up in an inquiry by the Inspector-General of New York state, George Moresco, into the award of lottery contracts. Mr Moresco is investigating whether 'inappropriate influence' was exerted on the director of the state lottery by Victor Collucci, a former GTECH sales manager.

A spokesman for GTECH said there was no continuing problem in New York and a challenge to the contract had been dismissed by the courts.

GTECH faces a more difficult problem in Maryland, where it was awarded a contract two years ago. The contract has been reviewed three times and last December the US Attorney General's office said it had launched an investigation - still under way - into the lottery procurement process in Maryland.

In February last year, a lobbyist hired by GTECH in California, Clay Jackson, was indicted on racketeering charges after a scandal involving former state senator Alan Robbins, who has admitted accepting bribes to vote against certain anti-lottery bills. Though GTECH has been told by the legal authorities that it is not a target of the investigation into Mr Jackson, Mr Robbins admitted he agreed to vote against the bill 'in exchange for campaign contributions to me and the state leadership from Jackson's lobbying client, GTECH, who opposed the bill'.

A banker advising on the lottery said there was a danger that the regulator, Peter Davis, currently deputy chairman of Abbey National, would be forced to hold up any bids involving GTECH and AWI while all regulatory issues were settled, and this could put them out of the running.