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D.C. Lottery game bidder back with new partner

- The Washington Times - Wednesday, December 12, 2012

The majority subcontractor on the $38 million D.C. Lottery contract is competing for a new game with a different foreign partner in a process that could involve one of his well-connected friends at D.C. Lottery.

An application for a certified joint venture between Emmanuel Bailey's firm, Veterans Services Corp. (VSC), and Canadian firm Pollard Banknote Ltd. is under consideration by the same District authorities who certified him as a legitimate local business in his previous joint venture with Greek gaming giant Intralot — a decision deemed improper by the D.C. inspector general based on VSC's misrepresentations and lack of qualifications.

District law affords preference to firms that ensure local participation on city contracts.

D.C. Lottery's newest Instant Ticket contract comes online as a federal grand jury investigates suspected bribery and contract steering in the underlying lottery contract. It also arrives as D.C. Council member Jack Evans, chairman of the Committee on Finance and Revenue, convenes a hearing on the latest contracting process and on recent news reports that have included claims of favoritism related to Gabrielle Barry, chief of marketing new games and promotions for D.C. Lottery.

Among those reports were that Lottery Director Buddy Roogow overrode a hiring panel decision not to hire Ms. Barry — a close associate of Mr. Bailey's previously at Fannie Mae and at DC-09, the joint venture between Intralot and VSC that runs the D.C. Lottery — because she lacked sufficient lottery or marketing experience.

Not only did Mr. Roogow hire Ms. Barry, according to a complaint filed with the inspector general, he rewarded her with a salary commensurate with directors who have more responsibility.

But it is Mr. Bailey's relationship with Ms. Barry that could make competitors for the Instant Ticket contract uncomfortable, in the event either she or someone in her chain of command is responsible for evaluating the marketing component of the bids being submitted by VSC and Pollard Banknote.

The Office of Chief Financial Officer Natwar M. Gandhi did not respond to numerous written questions and calls seeking comment.

Neither Mr. Roogow nor Ms. Barry returned calls for comment. Mr. Bailey could not be reached for comment.

The complications of the Instant Ticket contract are just the latest installment of a long-running D.C. Lottery saga. One recent chapter of that saga likely involved both Mr. Bailey and Ms. Barry, as a new games manager who experienced an ill-fated attempt to launch a first-in-the-nation online gambling program known as iGaming. The venture surfaced after recently defeated At-Large Council member Michael A. Brown, who had worked for a law firm that represented gaming operators and who had received substantial campaign support from Mr. Bailey and his friends and associates, quietly included a provision for Internet gambling in a massive budget bill in late 2010.

However, the council was forced to repeal iGaming earlier this year in the face of criticism that it had been approved without sufficient public scrutiny and after the inspector general's report raised serious questions about the underlying D.C. Lottery contract and Mr. Bailey's firm's qualifications.

That collapse further tainted D.C. Lottery and the OCFO, which already had been discredited when a former procurement officer charged in court that he had been pressured to exclude a local contractor from an early round of bids and after a second procurement process resulted in a winning solo bid by Intralot, which was then forced by various council members to take on a local partner to gain their approval.

Asked to comment on Mr. Bailey's latest foray into D.C. Lottery's newest game but with a different international partner, in the midst of a council oversight hearing and a federal grand jury investigation, Byron Boothe, spokesman for Intralot said, "Mr. Bailey's a product of the D.C. Council and government. His position is a product of the council. They demanded we have a local partner, and we acceded to those demands. Now the subcontract belongs to a minority business that has a majority interest in the contract. Intralot is going to cooperate with any D.C. or U.S. government inquiry. And we are not privy to any illegal or illicit or unethical activity that may or may not have occurred in the District."

Community activists, concerned about what is supposed to be a stream of charitable revenue for the city, see red flags.

In a recent letter to city leaders, Rev. Anthony Motley, of Concerned Citizens for an Ethical and Transparent City Government, urged that Mr. Roogow be excluded from "any further contract deliberations" until the hearings and investigations are completed. "It would be a conflict of interest and highly unethical for such individuals to participate in any procurement decisions involving the current lottery contractor," he wrote.

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