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Reason I Back Sanitization Of Lottery Industry In Nigeria – Kashamu

Senator Buruji Kashamu represented Ogun East Senatorial District in the Senate between 2015 and 2019. He is an entrepreneur with interests in real estate, hospitality and entertainment sectors of the economy, among others. In this interview with reporters over the weekend, he speaks on why he is supporting the call for transparency in the gaming industry in Nigeria.

Musliudeen Adebayo brings excerpts of the interview for DAILY POST.

What is your interest in the gaming industry in Nigeria?

My interest in the gaming industry stems from the opportunity it gives for wealth generation, redistribu

tion and empowerment of the masses. I have heard some of the operators and sympathisers describing me and Western Lotto as whistle-blowers for the Federal Government. Yes, we are whistle-blowers. But the fact is: Premier Lotto’s Adebutus and Bet9ja’s Ayo Ojuroye and others were the first whistle-blowers who falsely alleged that I and Western Lotto wanted to deprive the Federal Government of revenue accruing from lottery and that we wanted to take over the role of the regulator. Their whistle-blowing led to the purported ban of foreign lottery games in Nigeria, a decision which has been reversed after the National Lottery Regulatory Commission (NLRC) found out that it was misled.

Now, the Commission has officially permitted Western Lotto to sell and promote the Ghana Games in Nigeria in a letter dated 30th January, 2020. Conversely, our own whistle-blowing led the Economic and Financial Crimes Commission (EFCC) to looking into their books and accounts from where they verified our assertions that many of the operators have been defrauding and short-changing the Federal Government for many years, thereby shutting them up.

Over the years, they had blackmailed many start-ups in the lottery business and this led to their premature death. But, in this case, it boomeranged. Our own incontrovertible evidence drowned their unsubstantiated claims against me and Western Lotto. Upon seeing the light and the truth of the matter, the Federal Government decided to follow the light and uphold the truth. My interest and support for a transparent reign in the lottery business in Nigeria is further accentuated by my known support for the anti-corruption drive of President Muhammadu Buhari’s administration and avowed commitment to fighting injustice wherever it raises its ugly head. The truth is: most of the lottery and sports betting operators have been defrauding and practically exploiting the federal and state governments by short-changing them for over 20 years.

What is your assessment of the gaming industry?

Experts have said the gaming industry in Nigeria is worth $70 billion. That is over N25 trillion. Unfortunately, how much of that do we see? What is the impact on our people and economy? It has been a case of the more you look, the less you see. If things were done rightly, all the lottery operators ought to have paid N600 billion to the Federal Government and its agencies but they have only paid N9 billion in the last 14 years. It is common knowledge that leading lottery and sports-betting companies are generating more than N1.5billion daily and N45billion monthly. Some of them have over 400 active accounts in various banks in Nigeria that they use to perpetrate their fraud and illegality of short-changing the government. The EFCC is well aware of all their antics and it is still investigating them. I wish to urge the Minister of Justice and the Minister of Special Duties to support the EFCC to bring the fraudulent operators to book and recover the almost N1 trillion in their kitty. After all the pay out, an average of N400 million still goes into their accounts daily. They share almost N10 billion every month. It is this money that they divert to various accounts and share to their children, directors, promoters and family members. They also use the proceeds to acquire properties all over the place and outside Nigeria.

For example, Premier Lotto generates N45 billion monthly and N500 billion yearly as profit. After deducting the cost of operations, the winnings and other expenses, Premier Lotto should be paying about N20 billion yearly to the Lottery Trust Fund and the Federal Government as tax. In 12 years, Premier Lotto should have paid nothing less than N240 billion in remittances and taxes to the Federal Government. But sadly, facts have shown that only about N6 billion has been remitted in 12 years. That is an average of N500 million yearly. The question is: Where is the remaining money? This needs to be thoroughly investigated. I have seen a schedule of the amount paid by Premier Lotto and other top lottery companies to the National Lottery Trust Fund. It is nothing to write home about.

It is on record that Premier Lotto only jerked up its remittances to N750 million in 2018 after the House of Representatives queried why it has consistently paid N500 million over the years, wondering if the company made the same sales in those years.

As if all these were not already too much, a major operator single-handedly sponsored the 2017 amendment to the enabling Act that set up the NLRC, with the singular aim of whittling down the government and NLRC’s powers and having exclusive rights over fixed odds in Nigeria. Some 500,000 dollars exchanged hands over the amendment. The process of the amendment was wrongly compromised and its contents obnoxious to the growth and development of the sector. It will be in the interest of Justice for the Federal Government to revisit the issue of the amendment of the Act and return it to what it used to be. Even if there is a need for an amendment, it should not be in the mould of the heavily compromised version.

Golden Chance Lotto remits about N7.5 million per month to the Commission and the Trust Fund respectively as its statutory obligation whereas it generates about N30 billion per month.

Very credible information which can be verified independently has it that Bet9ja makes over N1 billion daily. If it were to pay the statutory one (1) and two (2) percent that should go to the Commission and National Lottery Trust Fund, Bet9ja’s remittance to the Commission and Trust Fund should have been close to N2 billion per month.

All the lottery and sports-betting companies have over 60,000 outlets/agents spread all over the country. Instead of them to allow the industry to flourish like it is in Ghana, South Africa, United States and the United Kingdom, where the funds are used to support the government and promote good causes, they short-changed the Federal Government while feathering their own nest. Can you imagine one lottery operator saying he wanted to fix the National Stadium in Lagos when he has government’s money in his hands? What kind of corporate social responsibility or philanthropy is that? One of the sons of the operator, who is a politician, granted interview to PM News and other news media on the 17th of March, 2018, where he had the temerity to ask President Buhari to resign over alleged non-performance.

Another operator known as BetKing began operations in October 2017 whereas it was officially licensed in 2018. This means it had illegally begun operations before it was officially permitted to do so. Since 2017, it has not remitted or submitted any financials to the Commission and the National Lottery Trust Fund. Yet, it rakes in billions and takes same back to South Africa. As at May, 2019, the company was making N10 billion monthly. Now, it is generating between N12 billion and N18 billion monthly without making any report or remittance to the Commission and the Trust Fund. On the average, the amount that the lottery and bet companies are supposed to be paying to the NLRC and FIRS should not be less than N20billion per month. If they cannot recover the money that the operators have diverted in the past, the relevant authorities and agencies should take steps to recover all the assets and properties that they acquired through the proceeds of crime and criminality, and return them to the Federal Government.

In recent times, a lot of issues have been brewing in the gaming industry in Nigeria following the acquisition of exclusive rights to sell and promote the Ghana Games in Nigeria by Western Lotto Nigeria Limited. What is your take on this?

The Ghana Games is responsible for about 70 percent of the revenue from the lottery business. But it is being done in an illegal way. This aids the manipulation of the system and under-declaration of what they ought to be paying the government. They divert the funds into property acquisition and other businesses.

In a bid to correct the ugly trend and sanitise the system, Western Lotto obtained the franchise of the Ghana Games in Nigeria. And if due process is followed by the lottery operators in Nigeria with respect to this matter, the government will have so much to cater to the needs of the people and fix infrastructure, including the National Stadium. It should be noted that it is not only in the area of statutory remittances that they have been short-changing the government. How can a father and three of his biological children be members of a 14-man board of the National Lottery Trust Fund if it is not to circumvent the system? I urge the government to rise up and correct these anomalies.

A lot of the atrocities have been discovered by the Economic and Financial Crimes Commission (EFCC). The EFCC is investigating the allegations against the lottery and sports-betting operators in both Lagos and Abuja. After weeks of investigation, it was reported that some of the operators were invited and questioned at the Ikoyi office of the EFCC two weeks ago. They were later released on administrative bail. Sources say preliminary investigation has shown that they have short-changed the National Lottery Regulatory Commission (NLRC) and the Federal Government to the tune of over 100 billion naira; and more revelations are coming. Earlier, a lawyer and an accountant of the leading sports betting company, who were arrested by the EFCC in Abuja, lied that they have “an understanding” with the National Lottery Regulatory Commission (NLRC) not to pay remittances to the government on the retail arm of their business which is worth over N35 billion monthly. It is only on the online transactions that they make remittances. Can you imagine how much the Federal Government would have been deprived of?

Going by the level of atrocities that the lottery and sports-betting companies have perpetrated, they may have cumulatively short-changed the Federal Government to the tune of N600 billion. This is the money that they have been using to buy foreign football clubs, luxury cars and choice properties both locally and internationally.

May I at this juncture commend the universally-acclaimed Acting Chairman of the EFCC, Mallam Ibrahim Magu, for the good and thorough job that he and his team have done so far. They should keep up the good work and recover all the illicit funds in the hands of these criminals. The EFCC should also not forget the criminal aspect of their offences against the state.

I am aware that what Western Lotto and its promoters are doing is in line with the whistle-blowing policy of the Federal Government and anti-corruption drive of President Muhammadu Buhari’s Administration. I do know that the management of Western Lotto and other witnesses are ready to testify against the mafia in court. Although some of members of the mafia in lottery industry have threatened to kill me and those exposing them, I am not bothered since this is a cause of justice and truth. And the Almighty Allah will never allow anyone fighting a just cause to be unjustly treated!

For many years, Bet9ja has pegged its monthly remittances to the Commission and the Lottery Trust Fund at between N3 million and N6million. Take for instance; on Friday, 10th January, 2020, Bet9ja wrote to the Commission to remit its monthly dues for December, 2019.

The letter reads, “Our monthly remittances for the period under review are as follows: National Lottery Regulatory Commission – the sum of N3,170,045.83 (Three Million, One Hundred and Seventy Thousand, Forty-Five Naira, Eighty-Three Kobo) representing one percent of our online revenue and National Lottery Trust Fund – the sum of N6,340,091.66 (Six Million, Three Hundred and Forty Thousand, Ninety-One Naira, Sixty-Six Kobo) representing two percent of our online revenue. Evidence of the aforesaid remittances are annexed to the report herein attached.

“While thanking you for all your cooperation and supports in the past years, we look forward to a mutually beneficial relationship with the Commission in the year 2020.

“On behalf of our Board of Directors and Management Team, please accept the assurances of our highest consideration.”

I also have seen two letters dated 7th of November, 2019 and 10th of December, 2019 wherein KC Gaming Networks Limited, the operators of Bet9ja, reported to the Commission that it realised N329,011,000 and N315,488,583 for the months of October and November, 2019, and consequently remitted N9,870,330 and N9,463,456 to the Commission for the months of October and November, 2019 respectively. Yet, it is common knowledge that N45 billion is being raked in every month.

In a nutshell, the acquisition of the rights of the Ghana Games will bring about transparency in the gaming industry and boost the revenue of the Federal Government. So, why would anyone resist it?

Some members of the mafia in the lottery business are the ones resisting. They say how can Western Lotto seek to change the corrupt system that they have institutionalized and been feeding fat on over the years. So, they decided to become whistle-blowers against Western Lotto. In their desperate bid to maintain the status quo, they ganged up and lied to the Federal Government that Western Lotto was out to deny the government of the revenue accruing from the Ghana Games and that Western Lotto wants to take over the job of the National Lottery Regulatory Commission (NLRC). They went further to get the Commission to issue a statement that it had banned foreign lottery games in Nigeria. So, in setting the records straight, Western Lotto had to show that all the allegations against it were the handiwork of the mafia in the gaming industry in Nigeria who want to continue to defraud the Federal Government whereas its initiative is meant to sanitise the industry and bring a quantum leap to the revenue accruable to the Government from the gaming industry. I don’t know why they will want to continue in illegalities, oppose an initiative that will sanitise the industry and be disobeying the orders of court.

So far, there are two orders dated 16th December, 2019 and 21st January, 2020, restraining Premier Lotto and other operators from selling the Ghana Games or using its drawn numbers without recourse to Western Lotto. But, they have continued to flagrantly disobey these orders. May be they do not know that Western Lotto can go back to the court to recover all the proceeds they realised from the Ghana Games since the orders were made.

It is worthy to note that at a stakeholders’ meeting called in Abuja two weeks ago, the DG of NRLC confirmed Western Lotto’s position that the operators have not been paying what is due to the Federal Government. The Honourable Minister of Special Duties and Inter-Governmental Affairs, His Excellency, Senator George Akume, also confirmed same and further said the government has evidence to that effect. He advised the operators to remit what is due to the government to it without further delay. Otherwise, the relevant agencies of government will go after them and recover the monies. I give it to them and the universally-acclaimed Ibrahim Magu, for standing on the side of the truth. That is why I am joining the management of Western Lotto and the National Union of Lottery Agents and Employees (NULAE) in appealing to the EFCC to act swiftly on this issue and dismantle the whole mafia in the gaming industry. I want to also urge the Federal Government to continue to support the EFCC to unearth and recover all the government’s monies that they have used illegally to acquire properties for themselves and their families.

What are your views on the ban of foreign lottery games by the National Lottery Regulatory Commission?

As a public institution, the interest of the majority of the people, not a few, should be the major consideration of the Commission. I am strongly persuaded that the decision by the Commission was ill-informed as a result of the lies and wrong information it was fed with by the mafia in the lottery business. Thankfully, like I said earlier, that decision has been reversed and Western Lotto has been given the go-ahead to sell and promote the Ghana Games in Nigeria. At the stakeholders’ meeting, the Honourable Minister of Special Duties and Inter-Governmental Affairs categorically told the operators to obey the Rule of Law on the issue of the Ghana Games and allow the company that has acquired the rights of the Ghana Games to be, just as he impressed on them the need to remit what is due to the Federal Government. Otherwise, the relevant agencies of the government will be asked to go after them.

Some people say the major issue the NLRC has against Western Lotto is the fact that it took the Commission to court over the Ghana Games. How would you react to this?

The court case is not against the Commission per se, it is a nominal party. It was joined in the suit merely as the regulator with the powers to call the operators to order, especially when the Commission and the Trust Fund have also been complaining about non-remittances and under-declaration of what is due to them and the Federal Government. So, the Commission was only joined as the regulator with the mandate to bring sanity into the system and increase the revenue that is accruable to the Federal Government. To put it simply, we are partners-in-progress.

What is the way forward?

The only way for the government to generate huge revenue from the gaming industry is for the operators to promote their indoor games and those who have the franchise of foreign games like the Ghana Games should be allowed to promote same.

Anyone who is interested in the Ghana Games will go to Western Lotto to obtain the necessary conditions; one of which is to key their platforms into the NLRC and Western Lotto’s platforms to be able to monitor what is generated every day for transparency. That way, there will be harmony, transparency and growth in the industry, and Nigeria will be the better for it. I congratulate the Honourable Minister of Special Duties and Inter-Governmental Affairs, the Director-General of National Lottery Regulatory Commission (NLRC) and management staff, as well as the Board and Management of the National Lottery Trust Fund, and particularly rejoice with the Chairman and Executive Secretary of the Fund, because their clamour for transparency and more funds for the government to fix infrastructure, health and education is about seeing the light of the day.

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