All's not well with Kerala Lotteries, CAG points out

State-owned Kerala Lotteries has never made a loss since its inception in 1967, but the latest report of the CAG reveals that all's not well with the department.

In its report released Tuesday, the Comptroller and Auditor General covered an audit period from 2006 to 2011. Numerous defects like multiple claims, mistake in publication of prize-winning ticket and absence of validation controls, among others, were found.
The most curious case that surfaced was one in which the second prize for the Onam Bumper Lottery-2011 was published as ticket number TH-339602, but the real winner was ticket number IR-339602.

When the published ticket holder came to receive the prize, the department realised the mistake. Taking into account the mental agony suffered by the claimant for non-disbursal of his claim, the government gave him Rs.2 lakh as special compensation.

"The department said that this occurred due to a mistake in the computer system and measures were being taken to ensure correct results are uploaded," the CAG statement read.

"The fact remains that in addition to the mental agony suffered by the incorrect claimant, it resulted in a compensation of Rs.2 lakh paid by the department," the CAG commented.  
According to the government, Kerala Lotteries is heading for an all-time high sales of tickets, expected to exceed Rs.2,500 crore. The lottery has around 40,000 authorised agents and over 1,00,000 retail sellers of its tickets in the state. These are people whose livelihood depends on the lottery. 

The CAG report pointed out that no authenticated reports are available with this department on the actual number of selling agents.

"No data is available with the department to analyse and compare these figures," the CAG noted.

The audit also revealed that of the 214 prizes amounting to Rs.810.29 lakh distributed to agents during 2010-11, two agents got Rs.447.21 lakh in 122 prizes. This indicates monopoly of the agents, pointed out the CAG report.

Forged lottery tickets also appear to have surfaced, as the report points out that during 2008-2011, 118 multiple claims were received against 91 prize-winning tickets. "In 67 cases, Rs.73,200 was paid to the second claimant, and in  the remaining cases, the claims would be paid after the verification is over. It was found that admission of false claims was due to non-reading the barcode of the ticket to ascertain the genuineness of the ticket," states the CAG report.

Another thing that surfaced in the course of the audit was that of the 344 prizes, 69 prizes amounting to Rs.3.94 crore were  repeatedly won by persons residing at 30 households in Mumbai. This is a pointer to the possibility of fraudulent practice in claiming prizes.

"It is recommended that the department may pursue the cases with the Crime Branch for ensuring credibility," recommended the CAG. There are seven lottery draws a week in the state; there are also six bumper draws.