Greek gaming company Intralot was slapped with a $5 million fine by the D.C. Council for contract bid lies and woeful underperformance, costing the District millions.
Poor Performance
As states around the nation began passing sports betting legislation and subsequently licensing proven mobile sportsbooks to operate within their boundaries, one jurisdiction decided to recreate the wheel and give a no-bid $215 million contract to a foreign gaming company to engineer its own sports betting platform.
That jurisdiction was Washington, DC, and the name of the company was not Caesars, DraftKings or FanDuel, all with proven platforms, but a foreign entity named Intralot that ultimately created the glitchiest sports betting platform in the nation, GambetDC.
Complaints with the GambetDC platform were immediate after its launch in May 2020. Although the company made several attempts at fixing the bugs and improving the product, by the time it made any headway, customers had turned off and tuned out.
Only after contracting FanDuel, which many believe should have been one of several proven mobile sportsbooks servicing the DC area from the very beginning, did revenues increase and customer satisfaction improve dramatically.
Ultimately, the powers that be in the District opened up the market like virtually all other US states before them and now have several companies, including Caesars, BetMGM, DraftKings, Fanatics and FanDuel competing in a much more robust market.
Bringing Down the Hammer
The D.C. Council has announced a $5 million fine on Intralot and a $1.5 million fine on its small business subcontractor, Veterans Services Corporation (VSC), for deception and failing to perform. It was a long time coming, yet Intralot is still a provider of record for the District despite its many failures.
According to reports, the fine was handed down for the following reasons:
- Technical Failures: Frequent outages and usability issues with GambetDC which drew significant user complaints.
- Missed Revenue Targets: Underwhelming performance in generating anticipated revenue for the District, falling well short of projections.
- Lack of Transparency: Failure to provide timely and comprehensive reports on operations and financial performance, as stipulated in the contract.
The fines were unanimously approved, but there are rumors that there could be further action taken, including the rescission of Intralot’s contract with the District.
Councilmember Charles Allen stated:
“This fine sends a clear message that D.C. will not tolerate substandard performance, particularly in critical revenue-generating initiatives. Our residents deserve better oversight and outcomes from public contracts.”
The Attorney General of the District of Columbia, Brian Schwalb, said:
“This is a warning to any company that tries to manipulate and exploit District contracting laws, especially laws intended to build the capacity of the local businesses vital to our economy. Intralot and VSC’s sports betting deal was a sham from the start—an elaborate scheme to secure a lucrative, high-profile opportunity on a sole-source basis while circumventing the District’s small business contracting laws.
My office will continue to enforce the False Claims Act to root out contracting fraud, hold accountable anyone who tries to get over on the District and its taxpayers, and level the playing field for law-abiding companies seeking to do business with District government.”
Intralot acknowledged the council’s decision, issuing a statement that included the following:
“We remain committed to improving our operations and restoring trust with the District.”
