A Mandel family was sentenced to prison in a Milton courtroom on Tuesday on allegations in taking part into a massive insider lottery scam which forced the Ontario Lottery and Gaming Corporation (OLG) to start using stricter security measures. The case dates back more than 14 years.
Back in April 2018, the 35-year-old Kenneth Chung, who operated Burlington-based Variety Plus, and his 68-year-old father Jun-Chul Chung, who was a part-time worker in the same venue, were found guilty of stealing lottery tickets over a period of eight months until February 2004. In addition, the father was found guilty of stealing the winning Lotto Super 7 ticket worth CA$12.5 million in December 2003. His 36-year-old daughter Kathleen Chung, who also took part in the scheme and falsely claimed the winnings, was also convicted of possessing stolen property and participating in the OLG fraud.
The Ontario Superior Court Justice Douglas Gray found that the fraud was a large-scale one and rejected the calls of Chung’s lawyers for conditional sentences, and a suspended sentence in the case of Kenneth Chung, saying that it such a ruling would be inappropriate considering the fraud.
Judge Gray sentenced the father to seven years in prison, while his daughter got a four-year imprisonment sentence. The son got the smallest prison sentence of ten months only, as the judge found that he did not participate in the winning lottery ticket fraud.
“The crimes perpetrated by the Chungs had a profound impact on the public’s trust and confidence in the integrity of lotteries and on OLG’s reputation” – OLG said for Toronto Sun.
Public Outcry Leads to OPP Investigation of the Fraud Case
The large-scale lottery fraud case was described as the most shocking example of the “too cozy” relationship between the OLG and its retailers, as the Ombudsman report called it in 2007. According to the report, an amount of about CA$100 million was paid out to lottery insiders under suspicious circumstances.
Eventually, a strong expression of public disapproval resulted in an investigation launched by the Ontario Provincial Police, followed by the arrests of the Chung family in 2010.
As heard by the court, Kathleen Chung went to the Toronto office of the OLG to claim the above-mentioned CA$12.5-million prize on February 5th, 2004. At first, she said she was no relative of Kenneth Chung who at the time managed the Burlington store where the lottery ticket had been validated, but she eventually admitted he was her brother.
Ms. Chung also said she could not remember where she bought the original ticket from, and later claimed that she may have purchased it in the St. Catherines’ area. OLG’s Toronto office staff were not entirely sure these claims were true but still issued Ms. Chung a cheque for the prize in December 2004.
The Chung family has been on bail for eight years since the arrest.
Despite the imprisonment sentences he announced, Judge Gray criticised the gaming agency, too, saying that the OLG had to be more careful before paying the CA$12.5-million lottery prize out.
The Chungs will be back in court in October, as the court has to hear arguments regarding restitution and forfeiture.