First and foremost, I was extremely surprised to read an article from the Fourth Estate shared by Sulemana Briamah, making some comparisons between:
- Telecom Business Model and Lottery Business Model of NLA-KGL
- Dealers and Agents of Scratch Cards for Telecom companies and Lotto Marketing Companies for the National Lottery Authority (NLA).
Comparing the lottery business to the selling of scratch cards in exchange for commission from Telecom companies clearly shows that Mr. Sulemana Briamah and the Fourth Estate lack full knowledge, understanding, experience, expertise, and competence when it comes to the lottery industry.
For the purpose of clarity, the Telecom Business Model has absolutely no correlation with the Lottery Business Model.
In fact, both business models operate under different industries and are regulated by different authorities.
The Telecom Business Model is under the regulatory body of the National Communications Authority (NCA), whereas the Lottery Business Model is under the regulatory body of the National Lottery Authority (NLA).
The NCA’s laws and NLA laws are completely different from each other, so comparing them is quite dishonest.
Based on their assumptions, can the Fourth Estate and Sulemana Briamah give honest answers to the following questions:
- Do the Telecom Companies pay winning tickets to the customers of the scratch cards dealers and agents on daily basis?
- Do the Telecom Companies pay 25% commissions based on the money used by the dealers and agents to purchase the scratch cards?
- Do the Telecom Companies conduct “Scratch Card Draws” for the customers of the scratch card dealers and agents?
- Are the Telecom Companies’ regulators just like the National Lottery Authority (NLA)?
- Did Dealers and Agents of Scratch Cards invest millions of dollars into the marketing of the cards?
- Did Dealers and Agents of Scratch Cards invest millions of dollars into the I. T infrastructure and system engineering for the sale of scratch cards to the general public with zero investments from the Telecom companies?
Providing honest and concrete answers to the above questions would let the Fourth Estate and Sulemana Briamah appreciate the fact that, it was unfair to compare the scratch card business of Telecom companies to the lottery business under the National Lottery Authority (NLA).
Now to the perfect case of the NLA-KGL Deal:
- Fourth Estate and Sulemana Briamah should kindly take their time to thoroughly read all the 58 Sections of the National Lotto Act, 2006 (Act 722) and point it out to their followers on Facebook, which section of Act 722 specifically made mentioned of NLA paying commission to a Lotto Marketing Company participating in Online lottery?
Can they indicate which specific Section of Act 722 talks about Online Lottery?
- Just like the LMC selling in the kiosks using Point of Sale Terminals are required to pre-pay for the NLA coupons, KGL Technology Limited as an online LMC also pre-pays each quarter for NLA Coupons.
- All the money NLA receives from KGL is paid into the Lotto Account as required by law. It is, therefore, the responsibility of NLA to transfer the net balance into the Lotto Account on monthly basis to the Consolidated Fund.
The net balance is rightly so because what if there is no net balance in the Lotto Account after payments of Winning Tickets, Commissions, Administrative, and General Expenses by NLA?
If at any point the money in the Lotto Account is not enough to pay winners, the excess can be charged against the Consolidated Fund (Section 33 of Act 722).
However, in practice, NLA has NEVER taken money from the Consolidated Fund to pay winners of national lotto. Also, it does not even make sense to use public funds in the Consolidated Fund to pay winners of national lotto while the country needs funds to take care of very important national projects.
- Despite the technology being used by KGL in partnership with the Telecom Companies to sell lottery products, all the monies NLA receives from KGL go into the Lotto Account.
What is the Lotto Account? Let me educate the Fourth Estate, and Sulemana Briamah.
The “Lotto Account is any official Bank Account operated by the National Lottery Authority (NLA)”.
- What empirical research has Fourth Estate or Sulemana Briamah conducted in the lottery industry particularly Online lottery industry for them to conclude that about 90% of lotto stakers now buy their lotto on their phones directly using short codes (USSD)?
If 90% of Lotto Stakers buy lotto via USSD then how come banker-2-banker lotto operators and agents control 80% of the lottery industry in Ghana?
If 90% buy lotto via USSD, then how many buy lotto via Point of Sale Terminals (POSTs)?
And if only 10% are buying lotto via Point of Sale Terminals (POSTs), then how many are buying lotto via Paper issued by Banker-2-Banker lotto operators and agents?
If 90% are buying lotto via USSD, then how come Lotto Marketing Companies and Private Lotto Operators and Agents are still actively involved in the lottery business?
- Was NLA successful in experimenting with different technology partners to reap full benefits from online sales of its lotto business?
If Fourth Estate and Sulemana Briamah care to know before KGL coming on board, the NLA in partnership with private technology companies FAILED to benefit from online sales of lotto such as “Mobi Game 2 Sure”, “Mobile 5/90” , NLA 5/90(*890#) and “NLA Soccer Cash”
Has Fourth Estate, as a patriotic CSO, researched on the financial losses NLA incurred during the operations of Mobi Game 2 Sure, Mobile 5/90, NLA 5/90(*896#) and Soccer Cash?
- Yes, Keed Ghana Limited paid GHC 10 million as penalty to NLA for piloting *959# without the appropriate 5/90 Online License Agreement, and that was a good decision by both NLA and Keed Ghana Limited.
The general public would also like to know the answers from Fourth Estate and Sulemana Briamah regarding the following questions:
(a) How much Alpha Lotto Limited paid to NLA for illegally operating NLA 5/90 USSD and Web online lottery via *896# for 11 months?
(b) How much Onassis Lotto has paid to NLA for illegally operating NLA 5/90 USSD and Web online lottery via *859#?
(c) How much did operators of www.theb2blotto.com pay to NLA for operating illegally the NLA 5/90 lottery via Web Online?
The answers to the above 3 questions would illuminate the understanding of Fourth Estate and Sulemana Briamah that they are just being unprofessional in their investigations against NLA-KGL deal.
The decision of NLA not to pay commission to KGL is equally supported by Section 2(4), and Section 37(d) of the National Lotto Act, 2006(Act 722).
Respectfully speaking, I sincerely don’t think the Fourth Estate and Sulemana Briamah understand the lottery industry more than the Board Members of the National Lottery Authority(NLA); both the current and previous members of the Board.
- KGL has every legal right to protect its huge investments in the setting up of a world-class I. T. Infrastructure and system for the sustainability of the NLA 5/90 USSD and Web online lottery.
Per precedence, no company was competing with the Private Company operating NLA Mobile 5/90 or Mobi Game 2 Sure or NLA Soccer Cash at the time such products were in existence.
Also, NLA has NEVER given multiple licenses to companies to operate the same NLA product. Every Online LMC or collaborator is licensed to operate a specific lottery product.
For example:
959 exclusively for KGL 5/90
766 exclusively for Atena
787 exclusively for Wotiriyie
446 exclusively for Daywa 5/39
946 exclusively for Game Park
987 exclusively for Lucky 3
Also, regarding the duration of the license, NLA has signed 10-15 years license agreements with several Lotto Marketing Companies and Private Lotto Operators in 2024.
Don’t forget that Lots Services Ghana Limited and Simnet Ghana respectively have a 15-year and 10-year contract with NLA subject to automatic renewal for another 10-15 years.
- It is absolutely FALSE that 80% to 90% of lotto stakers in Ghana have moved to buying lotto online using just a USSD short code on their phone because there is no empirical research supporting this untrue claim.
The business of analogue lotto Kiosks equally owned by private companies and individuals started declining when majority of them decided to sell products on behalf of Banker-2-Banker Lotto Operators and Agents largely due to the attractive 35-40% commission they received from the Private Lotto Operators and Agents as compared to the 25% pay by the NLA.
The aggressive marketing approach, prompt payments, and higher commission of 35-40% by the Private Lotto Operators and Agents collapsed the lotto Kiosks business of LMCs, and not KGL’s presence in the lottery industry.
- So, how many companies do Fourth Estate and Sulemana Briamah think that NLA should license to sell NLA 5/90 USSD and Web online? Can they provide the names of such companies? In accordance with precedence, has NLA ever licensed multiple companies in the world to operate one specific Online lottery product? Absolutely NO.
Again, it is absolutely FALSE for Fourth Estate and Sulemana Briamah to state that, a prime business of NLA which will generate 80% to 90% of the NLA’s revenue has been handed over to one company, KGL.
This kind of argument is fueled by jealousy or envy because KGL started making sales from the bottom before, through huge investments and marketing strategies, they have been able to reach where they are now.
At the time KGL started online lottery sales, NLA had ZERO presence in the online lottery sales space.
- If NLA used 8years from 2013 to 2020 to pay GHC 182, 009, 000(182 million Ghana Cedis) into the Consolidated Fund then certainly any reasonable person would definitely applaud KGL for using one year(2024) to pay NLA GHC 157.6 million. How many license Agreements or contracts signed by NLA have been able to generate GHC 157.6 million to the NLA within one year? Absolutely None.
And if you argue that, NLA should rather pay a commission to KGL then seriously speaking you, maybe speaking from the standpoint of financial ignorance. If NLA decides to pay commission to KGL, the Authority will be paying 31% of the gross revenue generated annually to KGL, and KGL will NOT be responsible for marketing cost, operations cost, payments of prize monies, risks and liabilities associated with the NLA 5/90 USSD and Web online.
Let me point it out to Fourth Estate and Sulemana Briamah that, KGL will be extremely excited if NLA agrees to rather pay the company 31% commission, but the question will be, does NLA own the I. T. infrastructure and the systems for the running of the NLA 5/90 USSD and Web online lottery?
KGL at the initial stages of their license agreement even proposed revenue sharing formula with NLA but the Board in its wisdom and in accordance with the provisions of Section 2(4) and Section 37(d) agreed not to pay commission to KGL as an Online Lotto Marketing Company.
The management of KGL Technology Limited, in the interest of the country, is always very open for reviews and renegotiations when it comes to its License Agreement with the NLA.
- It is very misleading for Fourth Estate and Sulemana Briamah to create an erroneous impression that NLA doesn’t know the amount of revenue generated by KGL. So if NLA doesn’t even know how much of its digital coupons(online lotto) KGL sells, then how come Fourth Estate and Sulemana Briamah were able to know that KGL generates GHC 3 billion annually?
If GRA is fully aware of KGL’s revenue, how difficult is it then for NLA as a regulator to know the revenue generated by KGL?
Sulemana Briamah and Fourth Estate keep mentioning Lotto Account as if they don’t know that the Lotto Account is just a Bank Account owned and operated by NLA.
For the avoidance of any form of doubt, KGL’s quarterly pre-pay monies to NLA always goes to the Lotto Account.
Also, can Fourth Estate mention just one online lottery company in the world being paid a commission by the State for its operations?
Anyone who understands Act 722 and Lottery Regulations 1948, would clearly educate Fourth Estate and Sulemana Briamah that, paying 31% commission to KGL on the gross revenue generated is a suicide mission for NLA and the State, and the Board of NLA is 100% right for rejecting the payment of 31% as a commission to an online LMC like KGL.
- It is Never True that all NLA is left with at this stage as its business is the archaic analogue lottery sold in Kiosks with just about 10% or less of Lotto stakers.
If it is 10% of stakers, how come Lotto Marketing Companies haven’t closed their Kiosks?
If it is 10%, how come Banker-2-Banker lotto Operators and Agents are still in business making money?
The NLA, apart from generating revenue through the Kiosks also has the following games in operations.
They include:
(a) Caritas Lottery
(b) Atena
(c) Daywa
(d) Wotiriyie
(e) Game Park
(f)! Several other modern lottery products.
Respectfully, if Sulemana Briamah and Fourth Estate were thorough in their research, they would have realized that, not all the alleged GHC 3 billion comes to KGL as Profit.
Can Fourth Estate please help their readers and followers on Social media know how much out of that quoted 3 billion was used to:
(a) Pay winning tickets(Prize moneys to Winners of national lotto)?
(b) Pay MTN, Telecel and Airteltigo?
(c) Pay for the service, running, management and maintenance of the I. T infrastructure and systems driving the online 5/90 lottery business?
(d) Pay for marketing costs?
(e) Corporate Taxes to Ghana Revenue Authority(GRA)?
(f) Pre-pay NLA?
(g) Pay NLA Stabilization Fund?
(h)Pay to KGL as Profit?
If it is true that, NLA’s total revenue for 2024 including what it received from KGL is under GHC 350 million then what is the basis of Fourth Estate and Sulemana Briamah’s worry on the NLA-KGL deal considering the FACTS and Data below regarding the trends of NLA’s annual revenue from 2013 – 2020:
GHC 299, 761, 074 for 2020
GHC 349, 220, 308 for 2019
GHC 381, 038, 324 for 2018
GHC 401, 711, 318 for 2017
GHC 397, 750, 549 for 2016
GHC 365, 529, 893 for 2015
GHC 315, 918, 378 for 2014
GHC 255, 229, 663 for 2013
Has the Fourth Estate ever done an assessment of NLA regarding its:
(a) increased number of employees which comes at extra cost to the Authority?
(b) increased amount of money paid to Technical Service Providers?
(c) Increased commission payments from 20% to 25% on the gross revenue generated by NLA?
(d). Increased operations of illegal lottery operators and Agents across the country?
The 25% commission payments alone paid to Lotto Marketing Companies would make it extremely difficult for NLA to make any meaningful gains more than the quoted GHC 350 million by Fourth Estate and Sulemana Briamah.
- The current NLA Board and the Minister of Finance are NOT concerned about the Fourth Estate and Sulemana Briamah saga because:
(a). Fourth Estate and Sulemana Briamah have failed to establish any form of Corruption or suspected corruption regarding the NLA-KGL deal.
(b). Fourth Estate and Sulemana Briamah have FAILED to genuinely establish that KGL is taking away a GHC 3 billion business from the NLA.
(c) Fourth Estate and Sulemana Briamah have FAILED to establish any breach of Act 722 and L. I. 1948 in the NLA-KGL deal.
(d). Fourth Estate and Sulemana Briamah have FAILED to prove that the presence of KGL is a threat to NLA.
(e). Fourth Estate and Sulemana Briamah have FAILED to exhibit professionalism and higher ethical leadership regarding their investigations about the NLA-KGL deal.
(f). Fourth Estate and Sulemana Briamah have FAILED to demonstrate their full understanding of the lottery industry.
(g). Fourth Estate and Sulemana Briamah are pushing NLA and the Minister of Finance to incur a judgment debt of over $5 billion against the State regarding the NLA-KGL deal.
Moreover, Ghana Revenue Authority(GRA) is quiet about the brouhaha from Fourth Estate and Sulemana Briamah regarding a GHC 3 billion business of KGL because they know Fourth Estate and Sulemana Briamah are LYING about the figures, facts and data.
Finally, if the Car Owner (NLA) is satisfied with the performance of the Driver (KGL), who are the Fourth Estate and Sulemana Briamah to question the Car Owner (NLA)?
Which law can empower the car owner(NLA) to take over the ownership of the NLA 5/90 USSD and Web online lottery (the Car)?
Is the car owner(NLA) prepared to pay a judgment debt to the driver(KGL) if it changes the driver?
Does the new proposed driver by Fourth Estate and Sulemana Briamah have the capacity and competence within a year to pay more or the same amount of money paid by the old driver(KGL)?
And which law says that an Online LMC should be strictly paid by a Commission while NLA has no ownership over the I. T Infrastructure and systems built and managed by the Online LMC?
Clearly, the Fourth Estate and Sulemana Briamah are forced to create a bad image around the NLA-KGL deal, but it keeps backfiring.
