D.C. Officials Call for Inquiry into $215m No-Bid Gambling Contract

  • Intralot won D.C. mobile sports betting contract with no competition
  • Local Intralot subcontractor, Veterans Services, found to have no employees
  • Washington Post investigation revealed subcontractor had links to politicians
  • Multiple council members' motivations for votes being questioned
Illuminated city scene of Washington D.C. with the Capitol building in the background
Two D.C. Council members have asked for an investigation into the subcontractor of a no-bid mobile sports betting contract awarded to Intralot earlier this summer. [Image: Shutterstock.com]

Two council members want investigation

According to a report by The Washington Post, two members of the D.C. Council are pushing for an investigation into a local firm that was subcontracted by Intralot as part of a $215-million no-bid contract awarded by the same council.

The Post looked into Veterans Services and found that it has no employees.

The company, Veterans Services Corp., was chosen by Intralot to conform to regulations that require a local small business partner. The Post looked into Veterans Services and found that it has no employees.

The July vote to approve Intralot to power mobile sports betting in Washington, D.C. was a tight one. Even some council members who said yes in the 7-5 vote felt uneasy about the no-bid contract. And now it looks like they had reason to be skeptical.

Robert C. White Jr. and Elissa Silverman are the two council members to call for the probe. Silverman had voted against Intralot’s contract, while White cast what The Post called the “swing vote”.

Council members cry foul on subcontractor

DC09, a joint venture between Intralot and Veterans Services, will be developing the mobile betting platform. Interestingly, The Post found out that Veterans Services is the majority owner of DC09, but Intralot provided the money for its creation and controls the company.

“It is clear they are just a shell company,” said Silverman. In her inquiry request, she added that she wants to see if the Intralot contract can be “nullified or revisited”.

The D.C. Lottery will be the sole provider of mobile sports betting. White said that the lottery’s Chief Financial Officer Jeffrey DeWitt lobbied for Intralot to be its product developer. In a statement, he reports that he asked DeWitt to provide information to the council on Veteran Services’ ownership structure and, among other things, “how they plan to operate the sports betting contract with no employees.”

Veterans Services boss had connections

Connections between Emmanuel Bailey, who is the head of Veterans Services, and members of the D.C. Council are also raising eyebrows. Bailey has contributed more than $30,000 to D.C. political candidates since 2006.

Closer to the matter, Bailey hosted a fundraiser for council member Brandon T. Todd just a week after Todd voted in favor of the Intralot contract. Bailey also donated $1,000 to Todd’s “constituent services fund” in 2017 and 2018, according to The Post.

Council member Anita Bonds added in a text message to The Post that Bailey “obviously was/is the principal consultant.”

Some had a problem with the sole source nature of the contract; there was no competition.

Council members already had major questions about the no-bid contract this summer when they voted for it. Some had a problem with the sole-source nature of the contract; there was no competition. There were also ties between local subcontractors and politicians. Silverman believed that approving the contract would “erode” the public’s trust in government.

Council members under microscope

Councilman Jack Evans is the sponsor of the sports betting bill and main supporter of the Intralot contract. William Jarvis, an Intralot lobbyist, worked on contracts for Evans’ consulting firm. Other council members wanted Evans to recuse himself from the vote because of a conflict of interest, but he did not.

Evans wanted to avoid a bidding process to get sports betting launched before neighboring states Virginia and Maryland. He was eventually taken off committees because he was found to have committed ethics violations while heading the Metro transit agency and a federal investigation of his businesses was under way.

In addition to Evans, colleagues questioned Council Chairman Phil Mendelson’s behavior. Two members, White and Kenyan R. McDuffie, had been leaning against the Intralot contract. But after Mendelson gave them juicy committee assignments after Evans’ ouster, they voted with Mendelson on the contract. Local journalists widely believed the committee assignments were traded for votes.