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Auditor General criticizes Ontario Lottery top executives

Ontario Lottery and Gaming CorporationOntario Lottery and Gaming Corporation: Auditor General criticizes Ontario Lottery top executives

Ontario's provincial Auditor General, Jim McCarter, released his 21 page report this morning which has questioned the integrity of the executives behind the OLGC.

(See link to the full report after the article.)

The report not only showed unnecessary purchases made by some of the top executives in the company, but disclosed how millions of tax payers' dollars were being used for parties, cars, trips to the spa and even hiring party planners.

The investigation began on August 31, 2009 when the Minister of Finance made a request that the Auditor of General for Ontario investigate and review the Ontario Lottery and Gaming Corporation under Section 17 of the Auditor General Act.

The Minister requested that all findings under the investigation be made public and would include "a review of the employee expense practices with respect to the Ontario Lottery and Gaming Corporation, including the approvals process, and whether such expenses were incurred in accordance with established policies." The report covered OLG's senior executives, who have since been dismissed or have resigned from their roles within the OLGC and the board of directors.

Today's report disclosed expenses for travel, business meetings and hospitality incurred by the Ontario Lottery Gaming Corporation based on Ministry guidelines and compared many of them to expenses of the Federal Government and private companies.

While the expenses claimed for accommodations by OLGC executives was on par with the ministry guidelines, the receipts did lack detail and were vague at best. There were also charges for hotels that were slightly above the OLG negotiated rates.

Additionally, McCarter's report shows that 20% of the claims made weren't itemized and more than 10% did not include a list of attendees which is required by policy. Most of the claims for accommodations were approved without any written explanations or specific details as to what the expense was for.

Employee meetings could have been more cost effective, suggested the report, had the OLG execs held meetings in-house instead of opting for lavish lunches at pricey restaurants. In fact, the report shows that approximately $1 million was spent during the 08/09 fiscal year for both hospitality and employee meetings. Unfortunately an exact figure between the two wasn't available since the OLG didn't keep track of which expense was for hospitality and which was for employees.

A few points raised in McCarter's report included spending for corporate and divisional meetings, hospitality and executive vehicles. According to the report, the OLG spent more than $1 million on corporate and divisional events, including a conference in 2009 for 250 senior employees that cost a whopping $551,000. In addition to this, the report shows spending for spa retreats, gatherings at resorts, boat cruise and more than $100,000 spent on sporting events to rent whereby the OLG would rent sky boxes for certain retailers.

An astonishing blow to the investigation came from the vehicle expenses. The OLG leased "an executive fleet" of vehicles for 26 senior members which amounted to $17,000 to $24,000 per year. Another 16 senior employees were offered the vehicle package but instead declined and took an allowance. When questioned about the vehicles, the OLG said this was part of the company's "executive compensation package" which when compared to the packages provided to Minster cabinets is significantly higher.

While the OLG expects its employees to be prudent in their spending, McCarter's report clearly shows the opposite. Receipts for a conference held in Toronto during 2009 showed 40 of the 90 employees reserved a room at Toronto hotel even though they lived in the GTA. The OLG did eventually cancel the reservations but still had to pay the $3,900 cancellation fee for 22 of the 90 reservations that failed to cancel within the respected timeframe.

OLGC Expense Practices Report Suggestions

The report followed up with some suggestions and recommendations for the OLG including;

  • Work with its responsible ministry to develop an effective accountability framework that includes clear expectations and periodic reporting;
  • Where the current employee expense policy is silent on certain types of expenditures, develop guidelines to provide the necessary guidance to employees;
  • Reinforce and communicate the need for a culture of prudent employee expense practices to staff through training and leadership commitment;
  • In periodic internal audits include an assessment of whether departmental managers have properly approved employee expense claims; and
  • Through the new board of directors, review its employee meeting and conference arrangements, employee rewards and recognition programs, and entitlement to executive vehicles in the context of OLG executive compensation arrangements.

There was a lack of a prudent mindset," McCarter said, "A group of employees would get together and have a meeting, and rather than, say, ordering in a couple of sandwiches or paying for their own lunch, they'd go downstairs and have a fairly expensive meal at a restaurant.

McCarter said expense claims for meals, taxis and parking were regularly approved without supporting documentation. One in five expense claims lacked itemized bills. One in 10 meal expenses didn't list attendees.

What we tried to say to them is, at the end of the day, you really need a culture that recognizes you are in a quasi-public-sector environment.

The OLG began to implement changes within the different areas McCarter expressed concern about while the investigation was underway, including the rewards programs offered to employees and the purchase of tickets to professional sporting events, among others, and will be implementing additional changes.

Newark Examiner

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6 comments. Last comment 7 years ago by tiggs95.
Page 1 of 1
rdgrnr's avatar - walt
Way back up in them dadgum hills, son!
United States
Member #73904
April 28, 2009
14903 Posts
Offline
Posted: June 3, 2010, 11:01 am - IP Logged

Wow, Are these people refugees from the US Government or what? If not, they could be hired as Czars and put on the payroll immediately and given big expense acoounts. They'd fit right in with the program here.

Parties with Party Planners, cars, spas, travel, fancy hotels, lavish lunches at pricey restaurants, resorts, boat cruises, sky boxes, sporting events, expensive meals, taxis, parking, corporate events, half million dollar conferences. Half million dollar conferences? What were they conferring about? What to name the next scratcher?

I know, there must have been a big controversy over whether to name it "Easy Money!" or "Go For The Green!".

So they had to confer over steak and lobster and champagne at a luxury hotel for the weekend.

Makes perfect sense to me.


                                             
                     
                                         

 

 

 

 

                                                                                                   

"The only thing necessary for evil to triumph is for good men to do nothing"

                                                                                            --Edmund Burke

 

 

    Avatar
    Oklahoma City, OK
    United States
    Member #87976
    March 7, 2010
    101 Posts
    Offline
    Posted: June 4, 2010, 7:18 am - IP Logged

    Wow, Are these people refugees from the US Government or what? If not, they could be hired as Czars and put on the payroll immediately and given big expense acoounts. They'd fit right in with the program here.

    Parties with Party Planners, cars, spas, travel, fancy hotels, lavish lunches at pricey restaurants, resorts, boat cruises, sky boxes, sporting events, expensive meals, taxis, parking, corporate events, half million dollar conferences. Half million dollar conferences? What were they conferring about? What to name the next scratcher?

    I know, there must have been a big controversy over whether to name it "Easy Money!" or "Go For The Green!".

    So they had to confer over steak and lobster and champagne at a luxury hotel for the weekend.

    Makes perfect sense to me.

    Wonder if they're hiring?  We don't get these kind of perks where I work!!  Ridgy, if we both go to work for them, we could get together for lunch and call it a conference so we'd have an excuse to order lobster for lunch.  We'll let them hire us as consultants.  Unless you'd rather be the party planner!

    Looks like a party to me!  Party

    Apparently having a job on the Ontario Gaming and Lottery Commission is just like actually winning the lottery and you can use the lottery fund like your own personal bank account!

    Luck is when preparation meets opportunity!    Cool

      rdgrnr's avatar - walt
      Way back up in them dadgum hills, son!
      United States
      Member #73904
      April 28, 2009
      14903 Posts
      Offline
      Posted: June 4, 2010, 8:57 am - IP Logged

      Wonder if they're hiring?  We don't get these kind of perks where I work!!  Ridgy, if we both go to work for them, we could get together for lunch and call it a conference so we'd have an excuse to order lobster for lunch.  We'll let them hire us as consultants.  Unless you'd rather be the party planner!

      Looks like a party to me!  Party

      Apparently having a job on the Ontario Gaming and Lottery Commission is just like actually winning the lottery and you can use the lottery fund like your own personal bank account!

      I think we'd be just the Dream Team they need up there to straighten everything out Mo! I like the consultants idea and we really do need to have a conference first to get the ball rolling. Lobster sounds great!


                                                   
                           
                                               

       

       

       

       

                                                                                                         

      "The only thing necessary for evil to triumph is for good men to do nothing"

                                                                                                  --Edmund Burke

       

       

        tiggs95's avatar - Lottery-036.jpg

        United States
        Member #47420
        November 4, 2006
        3930 Posts
        Offline
        Posted: June 4, 2010, 1:13 pm - IP Logged

        I think we'd be just the Dream Team they need up there to straighten everything out Mo! I like the consultants idea and we really do need to have a conference first to get the ball rolling. Lobster sounds great!

        Could this be number 6???..The mind wonders..

          Avatar
          Oklahoma City, OK
          United States
          Member #87976
          March 7, 2010
          101 Posts
          Offline
          Posted: June 4, 2010, 1:46 pm - IP Logged

          Could this be number 6???..The mind wonders..

          I'm sure Ridgy wouldn't go anywhere without you, tiggs, so you'll have to join the dream team.  Sounds like there should be enough money in the lottery fund for all of us unless those "top executives" spent it all!  We'd better get them out while there's still money left to party on!

          Luck is when preparation meets opportunity!    Cool

            tiggs95's avatar - Lottery-036.jpg

            United States
            Member #47420
            November 4, 2006
            3930 Posts
            Offline
            Posted: June 4, 2010, 1:59 pm - IP Logged

            I'm sure Ridgy wouldn't go anywhere without you, tiggs, so you'll have to join the dream team.  Sounds like there should be enough money in the lottery fund for all of us unless those "top executives" spent it all!  We'd better get them out while there's still money left to party on!

            tiggs has lost you on this but tiggs is losing it big time latley so no biggy..tiggs meant could this,you,be #6 wife..ridge has been married more then Elizabeth Taylor??..and still counting.