Con man's 'cash pot' - High-tech illegal gambling operation rakes in $millions

Durrant Pate, Gleaner Writer

Big money, big business, but it is all underground. Illegal operators rake in millions of dollars in sales of the popular Cash Pot game despite concentrated efforts by the police and the Betting, Gaming and Lotteries Commission (BGLC) to shut them down.

A Sunday Gleaner probe has revealed that the illegal operators are getting more sophisticated, using remittance agencies to expand their operations islandwide while pulling millions from the licensed operator Supreme Ventures.

Vice-president of group corporate Communications at Supreme Ventures, Sonia Davidson, last week confirmed the Sunday Gleaner findings.

"Yes, we are aware of some of the more sophisticated methods now being used with the aid of technology. We do gather intelligence from the field," said Davidson.

The BGLC is also aware of the increased use of technology by the illegal operators and their sales agents popularly referred to as 'runners'.

In one recent case, the BGLC held an illegal operator who had a very elaborate accounting system, which showed him having an annual turnover of $300 million with his top sales agent or runner earning $3 million for the year.

"The accounting records and computerised system were so detailed that they showed the sales by all agents, the dates on which the sales were made, payments to sales agents and even loans to sales agents by the illegal Cash Pot operator," said Derrick Peart, executive director of the BGLC.

He confirmed that remittance agencies

are now being used in the illegal Cash Pot business.

According to Peart, "Runners use the remittance agencies to funnel the profits from their weekly activities to bankers, while the bankers utilise these agencies to send cash to agents to cover winnings when the agents' daily sales are not able to cover payments for winnings."

Peart noted that the illegal operators use a combination of computer and telephone technologies, where the numbers bought and the amount wagered are transmitted to the banker from runners in some cases 10-15 minutes before the draw takes place.

The BGLC boss said the technology has allowed many illegal operators to go national in their business, servicing remote communities where Supreme Ventures has a difficulty setting up shops.

Roving business

The illegal operations have also moved from being stationary enterprise to a roving business where runners travel gate to gate selling numbers. This makes it convenient for players who do not have the time to travel to a Supreme Ventures location.

In addition, the runners offer credit to regular customers, a deal which Supreme Ventures cannot match.

Davidson explained that Supreme Ventures' operation is governed by the conditions of its gaming licence, the major one being a fixed-address location for lottery operations.

"As such (the company) is not able to participate in some of the methods being used by illegal operators, including the use of runners, bets via telephone and Internet," said Davidson.

She noted that the company continues to expand its network of lottery terminals islandwide to make the legal game available in a convenient manner to the public.

At the start-up of the Cash Pot game in 2001, there were 300 legal agents operating across the island. That number has now grown to more that 1,000.

In the meantime, the BGLC said its new drive to shut down the illegal Cash Pot operators will see it focusing on the bankers and major operators.

Illegal operations ended

According to the BGLC, that strategy is already reaping success, dismantling a number of illegal Cash Pot operations.

Peart said the new strategy is targeting the big bankers, whose operations may also involve money laundering, as seen in the case of Kingston businessman Patrick Chang, otherwise called 'Three Hand Chang', whose illegal gaming business made $278 million over an eight-month period - January to August 2003.

Chang pleaded guilty to breaches of the Money Laundering and the Betting, Gaming and Lotteries acts at his trial in September 2007.

The BGLC boss noted that the new strategy is informed by the experience that eliminating the banker is the only sure way of having any serious impact on the illicit trade.

"Each time a runner is caught and brought before the court, the small fines imposed by the magistrate is paid for by the banker in return for that individual's continuing service."

Peart contended that most bankers have set up multiple operations, spanning several communities throughout the island, and as such moving forward requires a more targeted enforcement strategy.