Lottery licenses expired in 2014
An illegal gambling market is flourishing in the Ukraine, and the big loser is the government, according to a report in the Kyiv Post. The publication reported that hundreds of gambling halls are operating with relative impunity out of lottery offices.
Throughout the Ukraine, almost all forms of gambling are banned with the exception of licensed lotteries, reported Casino News Daily. The parliament, or Verkhovna Rada, established the ban in 2009, then relaxed the ban in 2012 to allow lottery operators to offer gambling activities. But “unfinished reforms in the sector” and the lack of clear regulation mean that underground gaming facilities proliferate, without tax dollars going to the government.
The Post reported that there are lottery offices in every city and town in the country and many purport to offer lottery tickets. But many in fact do not sell the tickets, but are basically internet cafés stocked with computers that work like slot machines.
Customers purchase plastic cards that are placed into special slots on the keyboard and the computer instantly turns into a Vegas-style casino game, the newspaper reported. Only cash is accepted. And authorities seem to be in the dark about the industry, which could be reaping up to $1 billion in revenues, according to Agia Zagrebelska of the Anti-Monopoly Committee.
Adding to the confusion, the licenses of the three legal lottery operators—MSL, Patriot and the Ukrainian National Lottery—expired in 2014 but due to a legal loophole, can operate until new licenses are issued.
Each of the three operators is allowed to run up to 5,000 lottery shops, which suggests that there must be up to 15,000 lottery offices in Ukraine, CND reported. In addition, these three operators have extended their permits via franchise to some 180 retailing companies that can sell lottery tickets. As a result, the actual number of lottery offices cannot be estimated.
