Audit of the Operations of the Virgin Islands Lottery

The Office of the Virgin Islands Inspector General has issued the audit report on the operations of the Virgin Islands Lottery. Our audit disclosed that the Commission and the Executive Director did not effectively administer the operations of the Lottery. Specifically, we found that:(i) 14,251 tickets, valued at $330,734 could not be accounted for from the Lottery’s ticket inventory; (ii) eight unsold tickets with a prize value of $430,000 were missing from agency files; (iii) at least $9,460 was paid on winning tickets for which there was no evidence showing that they had been sold; (iv) there was a correlation between the high prize pay-out ratio and the potential for fraud; (v) cash advanced to the Sales Offices to pay prizes on winning tickets were not properly accounted for and reconciled; (vi) Lottery cashiers were not held accountable for shortages and overages on prize winnings; (vii) Lottery dealers were not properly monitored for compliance with license renewal and ticket quota requirements; (viii) the Lottery incurred $2,013,218 in costs not supported by contracts, paid $374,679 for contract work that was not satisfactorily completed , and paid costs overruns for two projects totaling $336,635; (ix) Lottery management acted outside the scope of its authority by exceeding their annual approved budget amounts for advertising, promotions and donations, and failed to get Commission approval for promotional contracts; and, (x) there was a breakdown in the supervisory relationship between the Commission and the Executive Director. To view the report, click here.