BCLC’s slots glitch; Alberta on the fence; Quebec’s IP-blocking ‘health’ plan

loto-quebec-ip-blocking-health-planCanada’s British Columbia Lottery Corporation (BCLC) has paid out nearly $1.1m to customers after uncovering a software glitch on its online gambling site PlayNow.com.

In a statement issued last week, BCLC said a review had uncovered an incorrect configuration setting on its Wizard of Odds slots title that failed to alert players of a progressive jackpot win. The glitch affected a total of nine players who should have been awarded varying jackpots totaling $1,088,120 between July 16, 2014 and June 10, 2015.

BCLC said it removed the offending slots title from its site on June 10, after which it conducted a review of the past 11 months’ activity. BCLC says the game was found to qualify only those players who bet one dollar or more per spin, when the game was supposed to have no minimum bet requirement. BCLC claimed to have found no problems with the game’s random number generator.

Meanwhile, across the border in the province of Alberta, the new NDP government has yet to decide whether it will follow through with the previous administration’s plan to launch its own online gambling network later this year. The NDP were surprise winners in May’s election, ending the Tories’ 44-year run as the province’s ruling party.

Earlier this month, NDP Finance Minister Joe Ceci told the Calgary Herald that he’d yet to form an opinion because he hadn’t reviewed the previous government’s consultations with prospective technology providers. Health Minister Sarah Hoffman was equally noncommittal, saying only that the current lack of governmental oversight of online gambling made it “difficult to assess the hardships it causes some users.”

Much further east, Quebec’s plan to impose IP-blocking of sites not controlled or licensed by the province have come under further criticism. Late last month, online rights watchdog Michael Geist told Vice.com that the Quebec government was “pretty transparent about the fact that it wants the blocking in order to commercially benefit its licensed alternative [Loto-Quebec’s Espacejeux gambling site].”

Late last month, Geist wrote a widely distributed op-ed arguing that the province was overstepping its legal bounds by attempting to claim jurisdiction over telecommunications regulation, which is the federal government’s responsibility.

But the province appears to have anticipated such concerns by framing it’s blocking plan not as a matter of telecommunications but as a public health issue, i.e. supporting Loto-Quebec’s efforts to mitigate compulsive gambling issues. Provincial Finance Minister Carlos Leitao has stated that there are “things we can do on our side because we can tackle these questions from a public health perspective, which is in our jurisdiction.”

In reality, the real health issue here is Loto-Quebec’s bottom line. Quebec estimates that its provincially-run online gambling site could earn an additional $13.5m in its first year of IP-blocking, rising to $27m per year after that.

Loto-Quebec might not be so desperate to go down this route were it not for the fact that the company has been badly mismanaged in recent years. In October 2014, the corporation announced it was writing off $98.3m in taxpayer funds from a failed investment in French casino operator JOA Groupe.

More recently, the Journal de Montreal revealed that Loto-Quebec had lost an additional $92m from an ill-fated investment in a brick-and-mortar casino partnership in Pointe-au-Pic. Since Casino de Charlevoix was built 15 years ago, Loto-Quebec has invested $127.7m in the partnership while receiving only $9.7m in revenue. Loto-Quebec recently declared the property’s book value to be just $26m, resulting in a net loss to date of $92m.

Claude Charbonneau, an Accountant and Chartered Financial Fraud Examiner who represents the League of Quebec’s taxpayer watchdog group, characterized Loto-Quebec’s investment history as a “disastrous adventure.” Claire Joly, the League’s director general, said there was “a serious problem of financial transparency at Loto-Quebec.” Point taken, but as far as the IP-blocking plan, we agree with Geist’s assertion that Loto-Quebec was being thoroughly transparent.