Newspaper sting operation on Loto Quebec

It appears from a Loto Quebec statement this week that its online gambling website Espacejeux.com was the target of a local journo looking for a story recently.
The statement identified the local television program JE on the TVA network, naming reporter Dominique Trottier, who appears to have enlisted the aid of a mother and teenage son in “testing” Espacejeux’s underage exclusion systems.
The teenager was allegedly encouraged to use his mother’s credit card and identity to sign up on Espacejeux and begin playing.
“Regardless of the set-up engineered by the JE team and their adult accomplices, Loto-Québec points out that the teenager could have as just well used his mother’s credit card to play on any of the 2,000 illegal game sites or purchase items on electronics, music or clothing product sites,” the statement reads.
“Unlike illegal game sites, Espacejeux has implemented a series of stringent measures to guard against identity theft and ensure that its clients are over 18 years of age. The system requires a valid credit card number, which is standard practice.
“In less than three months, thousands of people have become Espacejeux clients by following the four sign-up steps which include….an exhaustive identification process. The last part of the sign-up procedure involves written confirmation of the created account being sent by regular mail, in a plain envelope, to the address provided by the customer. In the event of fraud, that will ultimately allow consumers to be informed within a reasonable amount of time and to react accordingly.”
The company adds that to ensure an even stricter identification process, Loto-Québec is examining the possibility of imposing a waiting period between sign-up and authorisation to make a cash deposit in order to allow time for the customer to receive the letter from Espacejeux.
“In actual fact, the security process worked perfectly, despite the JE scenario, because Loto-Québec did send the teen’s mother a letter confirming her sign-up to Espacejeux,” Loto Quebec points out.
The Montreal-based company, which handles the Quebec province’s lottery and internet gambling market activities, has additionally reported on its quarterly performance over the period end September to end December 2010, revealing that overall sales rose 1.2 percent compared to the same period in the previous year, to a total of Cdn$902.9 million.
Net profits were Cdn331.7 million, unchanged from the same period during the last fiscal year. Loto Quebec reports that the positive performance is mainly attributable to the growth of lottery sales.
“Despite the repercussions of the economic crisis that are still being felt, income in this [lottery] sector rose by 5.1 percent compared to the third quarter of the last fiscal year. The casino (-3.5 percent) and video lottery (-2.5 percent) sectors experienced a drop in sales, while the bingo sector showed an increase of 1.2 percent”, the company statement reveals.
Loto-Québec generated cumulative consolidated revenues of Cdn$2.727 billion with net profits of Cdn$1.026 billion – a drop of 2.4 percent in sales and 4.2 percent in net profits. The decline was flagged during the first two quarters of fiscal 2010-2011, and in Q3, results were similar to those of the same period of the previous fiscal year.
Costs were reduced by 1.1 percent as part of the company’s expenses reduction strategy and in compliance with the Government of Québec’s Balanced Budget Act (Draft Bill 100).
Loto-Québec launched its espacejeux.com online gaming site on December 1st 2010, allowing adult Québec residents to legally play games of chance online. The company has undertaken to regularly add new games in order to maintain a diversified and competitive gaming offering.

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