The state of Oregon is preparing to offer sports betting via the lottery. The path for sports betting was recently cleared thanks to the Oregon Lottery director Barry Pack. He signed a contract with SBTech Malta Ltd to get started in the new industry.

However, the choice of the gaming technology provider was not without controversy. A competing bidder for the position has alleged that SBTech Malta currently operates in regions where gambling is not legalized.

Hush, hush

The officials of the Oregon Lottery have remained very quiet when it comes to the contract details. They did release the contract with SBTEch Malta to the media, but only after allowing the tech company the ability to redact portions of the paperwork. SBTech actually blacked out full pages of content. Information in the blackout included how much the state will pay the provider for services.

Officials also did not provide information on the background check of SBTech. The Oregon State Police conducted a background check of the company. Instead of providing the public with the full check, the lottery summarized police findings. The company was recommended for hire by the lottery director of security, Darin Goodwiler.

Lottery officials are ready to get started as sports betting has been estimated to bring as much as $330m (￡262,000) in the first year of operations and more than double at $680m (￡539,000) by the third year. The state saw SBTech as an attractive provider of sports betting tech, as the company offers a turnkey package. This includes an app that allows players to wager via mobile devices.

Scientific Games files complaint

During the bidding process for the sports betting position in Oregon, SBTech was not the only provider to apply. Scientific Gaming also wanted the position, and eventually filed a formal complaint against the state’s decision to hire SBTech.

The unsuccessful bidder stated SBTech should be disqualified, pointing out that it operates in Iran, Turkey and other regions where sports betting is banned along with other gambling activities. Scientific Gaming offered evidence to state police as well as lottery officials.

As part of the background check, detectives from Oregon traveled to Bulgaria to complete interviews with SBTech’s officials. Whether or not the investigators took the information provided by Scientific Games into consideration once it was provided has not been revealed.

Goodwiler’s summing up

In the summary, Goodwiler pointed out there was no cause for concern. He focused on China, noting that officials there are widely tolerant of gambling despite the law. He stated that an allegation was brought to the investigation’s attention that SBTech was offering services in a black market, more specifically in China. Goodwiler said the area is considered a gray market. He recommended that the Lottery monitors the status of the situation.

SBTech said: “To be very clear, SBTech does not operate in any black markets. If it did, it would not be licensed in the numerous jurisdictions it is currently licensed in. After a very comprehensive investigation (including investigation into the falsehoods and misinformation circulated by SBTech’s competitor), the Oregon State Police gave SBTech the seal of approval.”

Goodwiler also mentions in his summary that Pennsylvania, Mississippi and New Jersey have all approved the company to operate.