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Criminal probe sought in award of NJ Lottery contract

Oct 10, 2006, 9:03 am

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New Jersey LotteryNew Jersey Lottery: Criminal probe sought in award of NJ Lottery contract

A New Jersey Assembly Democrat has asked for a criminal investigation into the role a Republican assemblywoman and her former lobbying firm played in helping the state's lottery operator gain a new contract despite bidding nearly $32 million more than a competitor.

Assemblyman Reed Gusciora, D-Princeton, sent a letter Sept. 29 to Gregory A. Paw, director of the state Division of Criminal Justice, asking for an investigation to determine whether Assemblywoman Jennifer Beck, R-Red Bank, and her former lobbying firm, the MWW Group, illegally helped GTech get a new five-year, $106.7 million contract when competitor Scientific Games bid $75 million.

In a quasi-court hearing before former Supreme Court Justice Daniel J. O'Hern Jr., lawyers for Scientific Games said state officials skewed the bidding process to keep GTech and that there was a conflict of interest because the MWW Group held a public relations contract with the lottery while also lobbying for GTech.

Documents not yet discussed in the hearing show that Beck and other lobbyists were meeting about the pending contract bid a year before it was awarded. Beck has said she did not lobby on the contract.

"It raises serious questions about the legality of Ms. Beck's lobbying activities for GTech when the private lottery service provider was seeking a renewal of its state contract and while MWW was under contract to perform public relations service for the lottery commission," Gusciora wrote.

David Wald, spokesman for the Department of Law and Public Safety, said Paw hadn't seen the letter and declined comment.

The letter comes during a feud between Assembly Republicans and Democrats after the minority GOP called for a special session on ethics to complement the ongoing property tax session.

"We're trying to stamp out the sanctimonium," Gusciora said. ". . . If they want all members to be above board and their ethics to be beyond reproach, which I agree, then they should join in on this."

Beck, who left MWW in December 2004, said she never lobbied for the contract renewal. She said she lobbied mostly on bringing video lottery terminals, or VLTs, and keno to New Jersey.

"Reed should really do his homework. I had been gone from MWW for almost a year at the time the GTech contract was awarded," Beck said. "These are the same deceptive tactics that they used against me during the campaign last year."

Bill Murray, senior vice president for MWW, said Gusciora has been misled by statements Scientific Games' lawyers made during the contract hearing. He said his company would welcome an inquiry.

"The statements made by attorneys for Scientific Games are untrue, without any basis in fact and grossly irresponsible," Murray said. "Their false statements are the product of a company that lost an open public bid and is now attempting to change that result through misleading lobbying and public relations tactics."

Representatives of Scientific Games declined comment.

Joel Sterns, the lead lawyer for GTech, has argued that there was no conflict surrounding MWW.

"All of the information that everybody has with regard to the lottery shows there was absolutely no conflict whatsoever," Sterns said.

Assembly Minority Leader Alex DeCroce called Gusciora the "hatchet man" for the Assembly Democrats and called the lottery letter retaliation for his party's recent push for ethics reform.


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