TATTERSALL'S involvement in an allegedly illegal African lottery is being probed by Victoria's gambling watchdog.

The pokies giant is helping to run a financially troubled Nigerian lottery that could be illegal under the west African nation's constitution.

Tattsnet, a private company half-owned by Tattersall's and Swedish company Essnet, has a multi-million dollar technology supply contract with National Sports Lottery.

A Tattersall's spokesman said he had no knowledge of NSL's financial situation and denied Lotto Nigeria was acting illegally.

NSL, which runs Lotto Nigeria, has the support of President and former military dictator Olusegun Obasanjo.

Nigeria is Africa's second richest country, but was recently ranked its most corrupt.
Lotto Nigeria has been denied membership of the World Lottery Association, of which Tattersall's is a founding member, because of a query over its legality and the nation's money-laundering problems.

Tattersall's is moving towards a historic $2 billion sharemarket float before its Victorian lotto monopoly expires in 2007.

A senior investigator with the Victorian Commission for Gambling Regulation has launched a preliminary inquiry into Tattersall's involvement with Lotto Nigeria, and will soon interview Tattsnet staff.

"We'll be talking to Tattersall's and getting their explanation of what they are actually doing in Nigeria," executive director Peter Cohen said.

Mr Cohen said "a quick look" had found no evidence of wrongdoing by Tatts' Nigerian business associates, but warned that the VCGR would act swiftly if any were uncovered.

"We would bring it to Tattersall's attention and advise them of the legislation which requires them not to have a business association with someone that is unsuitable," he said.

Nigeria's biggest city-state, Lagos, has won a temporary court order to stop what it calls an "unconstitutional" lottery, causing heavy financial losses for the lotto operators.

"It is illegal. This lottery has no place in Nigeria," Lagos State Commissioner for Communications and Strategy, Dele Alake, said. "It is clear and plain to anyone that this is illegal ... it is in plain English."

Mr Alake said companies such as Tattersall's should not have become involved with a legally suspect enterprise. "We want anyone involved with this to realise it is illegal and will not be tolerated," he said.

Tattersall's spokesman Simon Doyle said Tattsnet would quit Nigeria if the lottery was unconstitutional, but was confident it was legal.

"The lottery operator, the party which was granted the licence by the federal Government of Nigeria, is utterly confident that the licence is valid," he said.

"I'm aware that there are other points of view based on Nigerian constitutional law . . . (but) as far as we're concerned, the lottery is legal."

The World Lottery Association said it had refused to accept Lotto Nigeria's bid to join the peak industry body.

"They have applied for membership . . . and we have rejected it," general secretary Yvonne Schnyder said from WLA headquarters in Switzerland.

"They have not been granted affiliation with the World Lottery Association."

Nigeria Lotto is operated by NSL Lotteries Management Company Limited, a wholly owned subsidiary of NSL, which went broke in 2002, leaving both creditors and lotto winners out of pocket.

Tattsnet was last year awarded a 10-year contract to provide online lottery services for the re-branded NSL enterprise, which was awarded a 30-year licence by the President.
More recently, President Obasanjo has fought amendments to a Lottery Bill that would curtail his control of the distribution of lottery funds and control his appointments to gambling commissions.

NSL has so far failed to attract support for Lotto Nigeria.

A draw last month saw no winners in first, second or third divisions, and only one winner in fourth division.

Sources in Nigeria told the Herald Sun that NSL already had unpaid bills, its financial problems compounded by the lack of lottery ticket sales.

"I'm not aware of (NSL's) financial position, personally," Mr Doyle said.
"I've got no knowledge of what you're putting to me."

Mr Cohen, who was unaware of Tattersall's Nigerian links until contacted by the Herald Sun, could not say when the VCGR would conclude its inquiries.

"In any investigation, as you go you find new information. You can't put a time-line on it," he said.