Why Does EFCC Treat Lottery Business as Criminal Offence?

Nseobong Okon-Ekong and Iyke Bede report that one of Nigeria’s leading operators in the sports betting space, Bet9ja, is currently facing a court trial initiated by the Economic and Financial Crimes Commission (EFCC) Sokoto State Zonal Command for engaging in lottery business for which the Company is licensed by the National Lottery Regulatory Commission and many other state regulatory agencies. This legal battle could have significant implications for the gaming industry in Nigeria, with the outcome potentially setting new precedents for regulatory practices and compliance within the sector

The entire gaming industry in Nigeria is currently following with keen interest a matter before the Federal High Court, Birnin Kebbi Division, where KC Gaming Networks Limited, widely known by the moniker Bet9ja, along with two of its agents, are being prosecuted for engaging in lottery business.

The Economic and Financial Crimes Commission (the Sokoto Zonal command) has leveled an eight-count charge against the company and its agents, Sunday Ochonu and Gabriel Ochonu, for their alleged involvement in lottery activities in Sokoto State which has now been tagged as illegal.

The indictment in charge No FHC/KB/CR/19/2024 includes receiving of stakes and payment of lottery winning which they allegedly knew were derived from unlawful acts to wit : lottery.

God in the Details

Odeyemi Yemi Tunde, a punter, staked ₦200 on a series of games with ticket number B9TH64669473444–12110749 in April this year. The ticket, which turned out to be a winning ticket with potential winnings of ₦5,323,256.33, has since become a focal point in legal proceedings. The investigation into handling this substantial prize has led to charges against KC Gaming Networks Limited (Bet9ja) and its agents.

Upon reaching out to Gabriel, the shop’s manager, Tunde was informed that such winnings could not be redeemed and would require approval and payment by Sunday, who owns the shop. After a meeting with Sunday a couple of days later, Tunde received ₦323,000 and was told he would receive the rest of his money in installments. Sunday was subsequently invited by the Economic and Financial Crimes Commission (EFCC) after it was revealed that the enforcement unit had arraigned his manager.

After several investigations, Sunday revealed that Gabriel, who also had access to the admin account, had looted funds from his account to stake games, resulting in a series of losses after exhausting the funds wired to Sunday by Bet9ja. Note that Sunday’s wallet was used because the ticket in question was not played with Tunde’s personal account. According to Sunday, he noticed transactions on the account on April 27 and 28 and reprimanded Gabriel.

In a statement dated 06/05/24, Sunday pledged to pay Tunde the sum of ₦2,000,000 and to spread out the payments of the remaining ₦3,000,000 in ₦500,000 installments between June and November. A subsequent statement dated 09/05/24 revealed that Sunday had paid Tunde ₦2,500,000, promising to pay the remaining sum by the end of the month.

In his account, Gabriel revealed that he had made several withdrawals from the wallet to stake games. In three consecutive successful moves, he staked ₦1,000,000 but lost. In a frustrated attempt, he staked another ₦500,000 and lost. Additionally, he moved ₦1,000,000 (two transfers of ₦500,000) to his SportyBet account, staked, and lost. He also admitted to transferring ₦150,000 to his OPAY account ₦40,000 to a customer he owed, and could not account for how he squandered the remaining funds in the account.

Intrigues

This case exposes the challenges of doing business in Nigeria, where the cultural and religious practices are not in alignment with aspects of the law of the federation, sometimes giving the impression that there might be a different set of laws in operation in different parts of the country. This particular case is intriguing because it brings to the fore some of the daring questions which confront us as Nigerians daily. Can agencies of the federal government EFCC, Corporate Affairs Commission (CAC) and the National Lottery Regulatory Commission (NLRC), all established by acts of the National Assembly, confront themselves in an embarrassing manner before a court of law?

It might have been tolerable if the Sokoto government instituted the matter in court, saying it does not want lottery activities within its jurisdiction. But this is not the case. Curiously, the EFCC, an agency of the federal government, is seeking to get rid of the lottery business by prosecuting Bet9ja. Is it possible that the EFCC is ignorant that the CAC has approved the business of KC Networks Limited or that the NLRC licenses the company to carry on the lottery business all over Nigeria?

Bet9ja is a legally operating company that significantly contributes to Nigeria’s economy. With over 1,200 direct employees and 15,000 agents, Bet9ja provides employment to over 200,000 individuals across Nigeria. The company is known for its significant tax contributions, paying tens of billions of naira annually in company income, value-added, and education taxes, directly benefiting all states, including Sokoto and Kebbi. Moreover, Bet9ja is also actively involved in corporate social responsibility activities, furthering its positive impact on Nigerian society.

The actions of one individual, Gabriel, should not overshadow the company’s adherence to regulatory standards and its contributions to the economy. Bet9ja’s commitment to resolving this issue transparently, as demonstrated by Sunday’s efforts to reimburse Tunde, highlights the company’s dedication to maintaining trust and integrity in its operations.

Every segment of the gaming industry is waiting to see how the Bet9ja case at the Brinin Kebbi Division of the Federal High Court pans out. At the end of the day, the pronouncement of the judiciary may not be limited to that jurisdiction only. It is expected to have far-reaching effects on the lottery business in Nigeria.

The case has now been slated for 17th September 2024.