Solid Odds That China's Lottery System Is Rotten To The Core

Checking the results of sports lottery in central China
Checking the results of sports lottery in central China


BEIJING â€" After studying China's lottery operations, the country's National Audit Office recently identified "violations of discipline, misuse of funds, system deficiencies, poor management, and a lack of supervision in certain cities and provinces." The disclosures around this murky institution are startling, but sadly, Chinese citizens are hardly surprised.

The China Welfare Lottery Management Center is a state-owned holding company that manages and operates lottery scratch cards, whose proceeds are intended to help the poor, vulnerable and elderly. But a 60% controlling share of this operation has fallen into the hands of a man named He Wen.

Right from beginning, it turns out, the lottery has been more private than public. By the end of last year, the Zhongfu Online Scratch lottery had generated a turnover of 137 billion RMB ($22 billion) over the previous 12 years. It had also pocketed as much as 4.5 billion RMB ($73 million) in service charges. Yet the state-owned China Welfare Lottery Management Center received just 1.8 billion ($29 million), while the shareholder, He Wen, received 2.7 billion ($44 million).

A public-private partnership could be feasible. But it should be questioned whether the controlling stake of such an operation whose mission is to help bankroll the welfare state should fall into the hands of a single person.

A game of chance

China began its first lottery in 1987 with the purpose of "helping and assisting the old, the disabled, the orphans and the poor." Its operation involves astronomical sums, even dwarfing the annual net profits generated by China's three major oil companies put together.

According to Financial Ministry data, over the years, China's welfare and sports lotteries' cumulative sales have respectively led to the the distribution of 310 billion RMB ($50 billion) and 212 billion RMB ($34 million) in public welfare funds. But nobody knows where this money has really gone.

 Lottery in ShaoYang, Hunan Province â€" Photo: PanShiBo

Over the years, the Chinese public's doubts about the way the lottery is run have been persistent. Some were convinced that the jackpot results were obtained using modifications to the back-end database, though this was never proven. At one point, though, someone hacked the lottery's online system with a Trojan program, trying to tamper with the winning numbers. Since then, security has been reinforced. Even so, who knows whether or not internal falsifications exist? Everything lacks transparency. Even the identities of jackpot winners are kept secret.Â

The lottery operator has repeatedly emphasized that winning numbers are drawn at random, and that "the issuing of lotteries is under the state's jurisdiction and, therefore, its fairness is not to be questioned." The National Audit Office's disclosures beg to differ. Not only is the controlling stake of the supposedly national lottery operation not in the hands of the government, the drawing of the Union Lotto was discovered to be recorded before airing, instead of being broadcast live as was claimed.

As early as 2009, Wang Xuehong, director of the China Lottery Research Institute at Peking University and one of the drafters of China's Lottery Ordinance, had already noted that China lacked uniform national standards. He has argued that it needs a professional third-party organization for testing and certifying the technical system, the drawing and the betting equipment.

Corruption involving high officials has been frequent in the past. There's no reason to believe the lottery is any exception. What the public wants is for authorities to shed more light on the dark side of lottery operations.

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"The Truest Hypocrisy" - The Russia-NATO Clash Seen From Moscow

Russia has decided to cut off relations with the Western military alliance. But Moscow says it was NATO who really wanted the break based on its own internal rationale.

NATO chief Stoltenberg and Russian Foregin Minister Lavrov

Russian Foreign Ministry/TASS via ZUMA
Pavel Tarasenko and Sergei Strokan

MOSCOW — The Russian Foreign Ministry's announcement that the country's permanent representation to NATO would be shut down for an indefinite period is a major development. But from Moscow's viewpoint, there was little alternative

These measures were taken in response to the decision of NATO on Oct. 6 to cut the number of personnel allowed in the Russian mission to the Western alliance by half. NATO Secretary-General Jens Stoltenberg said the removal of accreditations was from eight employees of the Russian mission to NATO who were identified as undeclared employees of Russian intelligence." We have seen an increase in Russian malicious activity for some time now," Stoltenberg said.

The Russian Foreign Ministry called NATO's expulsion of Russian personnel a "ridiculous stunt," and Stoltenberg's words "the truest hypocrisy."

In announcing the complete shutdown in diplomacy between Moscow and NATO, the Russian Foreign Ministry added: "The 'Russian threat' is being hyped in strengthen the alliance's internal unity and create the appearance of its 'relevance' in modern geopolitical conditions."

The number of Russian diplomatic missions in Brussels has been reduced twice unilaterally by NATO in 2015 and 2018 - after the alliance's decision of April 1, 2014 to suspend all practical civilian and military cooperation between Russia and NATO in the wake of Russia's annexation of Crimea. Diplomats' access to the alliance headquarters and communications with its international secretariat was restricted, military contacts have frozen.

Yet the new closure of all diplomatic contacts is a perilous new low. Kommersant sources said that the changes will affect the military liaison mission of the North Atlantic alliance in Moscow, aimed at promoting the expansion of the dialogue between Russia and NATO. However, in recent years there has been no de facto cooperation. And now, as Foreign Minister Sergey Lavrov has announced, the activities of the military liaison mission will be suspended. The accreditation of its personnel will be canceled on November 1.

NATO told RIA Novosti news service on Monday that it regretted Moscow's move. Meanwhile, among Western countries, Germany was the first to respond. "It would complicate the already difficult situation in which we are now and prolong the "ice age," German Foreign Minister Heiko Maas told reporters.

"Lavrov said on Monday, commenting on the present and future of relations between Moscow and the North Atlantic Alliance, "If this is the case, then we see no great need to continue pretending that any changes will be possible in the foreseeable future because NATO has already announced that such changes are impossible.

The suspension of activities of the Russian Permanent Mission to NATO, as well as the military liaison and information mission in Russia, means that Moscow and Brussels have decided to "draw a final line under the partnership relations of previous decades," explained Andrei Kortunov, director-general of the Russian Council on Foreign Affairs, "These relations began to form in the 1990s, opening channels for cooperation between the sides … but they have continued to steadily deteriorate over recent years."

Kortunov believes the current rupture was promoted by Brussels. "A new strategy for NATO is being prepared, which will be adopted at the next summit of the alliance, and the previous partnership with Russia does not fit into its concept anymore."

The existence and expansion of NATO after the end of the Cold War was the main reason for the destruction of the whole complex of relations between Russia and the West. Today, Russia is paying particular attention to marking red lines related to the further steps of Ukraine's integration into NATO. Vladimir Putin's spokesman Dmitry Peskov previously stated this, warning that in response to the alliance's activity in the Ukrainian direction, Moscow would take "active steps" to ensure its security.

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