The Romanian National Lottery accounts were blocked by prosecutors, because of evidence of revenue generated from gambling without a license. The estimated damage is more than 100 million Euros, but there are reasons to believe that other 130 million would be also illegal proceeds.
The criminal investigation involves other three private companies as well, Greek: LOTROM, Intracom and Intralot. Prosecutors have calculated provisionally the current damage of over 100 million, is due to the fact that the Romanian National Lottery has generated its incomes from their slot machines without a license.
In addition, secondary investigators will recover 130 million from the Lottery and the three private companies for illegal income earned after 2009, when an emergency ordinance changed the rules on the Romanian gaming market.
The prosecutors stated that: “Even after the entry into force of this regulation, the Lottery hasn’t made its obligation to request authorization for each slot machine, which comes at the price of 8,000 euro / year and hasn’t even applied for a gambling license(25,000 lei / year)”.
The investigation was started by the antifraud authority in 2010 and has been taken over this year by prosecutors at the Court of Appeal in Bucharest. The “gambling” deal was based on a secret agreement which was signed in 2003, and was completed ten years later in 2013. However, by 2014, the prosecutors have calculated the unlawful proceeds of over 130 million. In order to recover the laundering, prosecutors have requested the blocking the accounts of all companies involved, but also have taken other protective measures as well.
The leading national company on the Romanian market has over 1,109 offices in which these slot machines can be found. The state company owns 150 units only in Bucharest.
Here is the BUSINESS PLAN. The Romanian Lottery purchased 6.263 devices from LOTROM, the contract was financed by the other two companies in the Greek group. The money would have been returned from generated incomes. But, according to the trade agreement concluded, the devices were recorded for another game – “video lottery” – which is taxed differently. In fact, the problems are even more ancient. Since 2006, the Lottery would have had to pay special taxes for the slot machines. Prosecutors are accusing the Lottery to work under undisclosed terms since the Lottery has in reality has done business with other gambling units than those for which it was licensed. The additional revenue would come from these incomes and are the key cause of prejudice against the state budget.
This investigation has be conducted by RISE PROJECT.
Who are the benefitors of this deal? LOTROM is a company which was founded in 2000 by two companies connected to a Greek billionaire, Sokratis Kokkalis. The second beneficiary was George Copos, who engaged in the business with his offshore companies. George Copos was released this Tuesday from prison after being convicted last year for another criminal business with Romanian Lottery.
Kokkalis, 75, is one of the richest men in the world, with a fortune estimated at 1.6 billion euros. He was the main shareholder of the football team Olympiakos Piraeus and multinational Intralot – holding the majority of stocks at LOTROM he is also active over a hundred companies involved in gaming worldwide. A Greek journalist investigation showed that the billionaire is an ex-Stasi agent – the former East German secret police. Kokkalis was personally involved in the affairs of its subsidiaries in Bucharest.
Switel LOTROM Corporation entered the deal in 2001, the company based in Lichtenstein connected to George Copos as well. The Lichtenstein company is registered a “Ana Group” brand, owned by Copos. The company appears in the indictment in “Transfers” criminal records, in which George Copos was convicted last year, along with other important names in the Romanian football. The bank statements reviewed by prosecutors show that the former owner of Rapid Bucharest football club has made a transfer from his personal account towards a brokerage firm based in Lichtenstein. The money traveled further and lead to the acquisition of shares in Switel Corporation. This company has owned five percent of LOTROM until 2008, when it has succumbed it’s shares to and offshore company based in Cyprus which owns several businesses controlled by George Copos.
The Lottery Contract between the stated owned company and the private companies involved in the case was initialed by director Nicholas Cristea, convicted in the “Lottery” case together with Copos.
You can the official list of licensed operators on the Romania gambling market bellow:
