During the depths of the Covid-19 pandemic last year, Atlantic Lottery Corp. saw in the shutdown an opportunity to build up its online gaming market.
Seeing “unprecedented growth” in online gaming as millions of Canadians in the country’s four Atlantic provinces were forced to stay home, Atlantic Lottery in April 2020 made a hard sell pitch to the provincial governments to act “immediately” to authorize online casinos to raise governmental revenues.
CBC News learned of this when it acquired a copy of a revised business plan Atlantic Lottery sent to the government of Prince Edward Island in April. Apparently, the same business plan was sent to the other three Atlantic provinces. In it, Atlantic Lottery told its provincial governments: “Covid-19 has dramatically altered the gaming landscape, as citizens are encouraged to stay home as much as possible while non-essential services have been suspended.” It also advised: “Interest for in-home entertainment options are [sic] at an all-time high. Internet gambling is up across the globe.” But it warned, “Opportunity will diminish if launch is post-Covid.”
Online casinos was not a new idea for Atlantic Lottery. It had promoted the idea for ten years—but when the pandemic hit the company saw its opportunity. New Brunswick was the first province to follow its advice in August. Now Nova Scotia and Prince Edward Island (P.E.I.) are on the verge of following its lead.
When the business plan surfaced on April 22, Atlantic Lottery issued this statement: “Atlantic Lottery regularly updates its shareholders on a variety of topics. This was particularly true during the early stages of the Covid-19 pandemic when our operations experienced significant changes.”
The company noted that the estimated 3,000 illegal and offshore sites that offer online gaming increased advertising last year as Covid infections spiked. “This raised the risk that more people in our region would be drawn to these sites, which may not offer the same level of player protection and do not keep revenue within Atlantic Canada.” It added, “Atlantic Lottery would not introduce a game to Atlantic Canadians if it wasn’t possible to do it responsibly.”
As brick and mortar casinos closed all over Canada in March and April last year, Atlantic Lotto’s website’s sales increased by a factor of 2.5 to one over two weeks with 3,000 new customers signing up in March alone.
Robert Henderson, a member of the P.E.I. called Atlantic Lottery’s pitch a “diabolical home gambling plan” that sought to “exploit Islanders during this pandemic while they were home.”
On April 21 he demanded of Finance Minister Darlene Compton: “Did you inform Atlantic Lottery Corp. and your appointed board of directors that their efforts to exploit the pandemic were not merely distasteful, but simply wrong?”
At the time, Compton had replied to Atlantic Lottery: “Our government is fully focused on helping Islanders weather a public health emergency. We are not interested in expanding access to gambling during this time.” But by December 22 the government had changed its mind and authorized the lottery commission to go forward.
On April 21 Compton told reporters that the goal of online casinos is to bring home residents who are wagering on the offshore sites. She said most players would prefer to support a home-based online casino “where you know the profits that are made come back to the province to support all of the services that Islanders expect.”
She has promised to earmark all government profits from the online casinos to mental health and addiction programs.
Critics have compared that to pouring gasoline on a fire and then increasing resources to firefighters.
Meanwhile, defending against possible criticism that online gaming is associated with gambling problems, Atlantic Lottery in 2019 commissioned a report by Responsible Gambling Council (RGC) that concluded, “the causal link between online gambling and gambling problems is not clearly established.” RGC provides certification for online and physical casinos.
The report, not intended for public consumption, was obtained by CBC News using a freedom of information request. Atlantic Lotto has said such reports were part of its “years of planning and independent expert reviews” that led to its operating of online casinos beginning earlier this year on the Atlantic provinces. The reports’ conclusion obviously came before the advent of the Covid pandemic.
According to the Lottery, the reports conclude “no substantial evidence that the introduction of online casino gambling would have a measurable impact on vulnerable players, nor that problem gambling has become more prevalent in the other Canadian jurisdictions where online casino games are already available.”
The RGC did warn that there is a risk factor associated with “easy and constant physical access” to online gaming combined with social isolation. It also cited the risks of relying on credit cards and digital currency, which could lead to the cash being “digitally abstracted” by players.
The other report it commissioned was by gaming consultant Richard Wood, who, while agreeing with that conclusion, added, “tentative evidence that online casino games can be problematic for at-risk players.”
Atlantic Lottery’s president and interim CEO Patrick Daigle has vigorously defended opening the online casinos, declaring, “Our perspective on this is that the most irresponsible thing to do is nothing while these offshore illegal operators are taking money from Atlantic Canadians.”
