Federal authorities are investigating possible corruption in the awarding of the District’s $228 million lottery contract and have interviewed several people with knowledge of the contentious process dating back more than four years.
Four people told The Washington Post that they had spoken with investigators from the FBI, the U.S. attorney’s office or both. Two of the four said they were asked to possibly testify before a grand jury now empaneled in the District.
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Those interviewed include Kenneth V. Cummins, a private investigator in the District, and Eric W. Payne, who was fired as contracting director by the D.C. chief financial officer and is suing his former employer for wrongful termination and defamation.
Two others for the first time also described lengthy questioning by authorities that probed wide-ranging aspects of the lottery procurement, starting with the initial bid in 2008, its disapproval by the D.C. Council, and the subsequent rebidding in 2009. They said the authorities also asked about “iGaming” — the Internet gambling proposal included in the 2009 contract that became a political flash point last year.
“My sense was, they were looking at everything,” said Cummins, who had no direct role in the lottery bidding but is familiar with the players. “They were interested in, ‘Who benefited from the council’s actions on this?’ ”
A person who was involved in the bidding process and who was interviewed by the investigators agreed that the scope is sweeping.
“They have a detailed sense of all the meetings and actions that were taken,” said the person, who spoke on the condition of anonymity to avoid impeding the investigation.
William Miller, a spokesman for U.S. Attorney Ronald C. Machen Jr., declined to comment on the office’s interest in the lottery deal. As with any investigation, the inquiries might not result in criminal charges.
The attention on the lottery dealings underscores the unprecedented focus by prosecutors on the workings of city government. Since January, Machen’s office has obtained guilty pleas to felony charges from two D.C. Council members and three associates of Mayor Vincent C. Gray (D) who were involved in his 2010 campaign.
But scrutiny of the lottery contract opens a new front in Machen’s war on political corruption in the city. The controversy dates to 2008, when the Office of the Chief Financial Officer awarded the contract to a joint venture of multinational lottery firm Intralot and a local partner.
The award encountered resistance from the D.C. Council — which retains the power to reject large city contracts — based on the checkered history of one of the local partners and his ties to then-Mayor Adrian M. Fenty (D). After months of wrangling, the council rejected the deal, and Chief Financial Officer Natwar M. Gandhi moved to rebid the contract in 2009.
It was again awarded to Intralot, this time bidding alone, but eyebrows were raised when the firm subsequently agreed to subcontract much of it to a local firm once the contract went to the council for approval.
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