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Jon Lender: Lottery Official Claims He's Victim Of Vendetta For Exposing '5 Card Cash' Fraud

Hartford Courant 2018-08-05 11:30:00

The Connecticut Lottery Corp. opened 2018 with a million dollar blunder at a Jan. 1 drawing, and months of controversy followed. But that seemed to die down as the agency recently reported a record $345 million in revenue on $1.2 billion in annual ticket sales, and took a step toward normality last month by hiring Gregory Smith, the acting Illinois lottery chief, to fill its long-vacant CEO position.

However, the surface calm is deceiving. There’s still big trouble.

It comes in the form of a “whistleblower complaint” from the lottery’s longtime security director, Alfred DuPuis — who claims that an attempt to discipline him over the Jan. 1 drawing snafu is, in reality, part of a pattern of retaliation against him for his role three years ago in exposing retailer fraud in the now-infamous 5 Card Cash game. That fraud resulted in 5 Card Cash’s shutdown and, eventually, 15 arrests.

Lottery officials denied the retaliation allegations contained in DuPuis’ complaint, which paints a poisonous picture of complicated conflict going back years inside the agency.

The complaint was filed May 12 with the state Commission on Human Rights and Opportunities, and was obtained Friday by Government Watch from the lottery agency via a Freedom of Information Act request. The CHRO has scheduled an “initial conference” on his complaint on Aug. 28.

The Connecticut Lottery Corp. has placed its $139,000-a-year security director, Alfred DuPuis, on a paid leave pending possible disciplinary action after an internal investigation concluded that he “acted with gross neglect … of his duties” leading up to a million-dollar blunder in a Jan. 1 drawing.

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DuPuis was placed on paid administrative leave Feb. 15 from his $139,000-a-year job after an internal lottery investigation resulted in an allegation that he acted “with gross neglect … of his duties” as the boss of lottery employees who made a major mistake Jan. 1 in selecting the winning numbers in the New Year’s Super Draw. The snafu resulted in a do-over drawing Jan. 16 and a $1 million loss to the state.

Dupuis was scheduled to return from that leave on Feb. 23 to face possible disciplinary action, but instead he took family leave and, later, medical leave, according to lottery officials — and he still has not returned to work six months later. Meanwhile, the disciplinary process against DuPuis has stalled until whenever he might return to work.

In his complaint to the CHRO, DuPuis listed damages that could be due him — including "attorney fees and...release from administrative leave and compensation for the emotional distress that I have suffered.”

Concerning the flawed Jan. 1 drawing, he said that “due to the failure of two of my direct [subordinates] to follow the approved official drawing procedures, they were both placed on administrative leave on Jan. 2 … [and] I worked to correct the problem by coordinating and completing a new drawing on Jan. 16 … and dealing with the public fallout.”

But then came the mid-February order that he go on leave and then come back to argue his case as to why the lottery “should not take any action against me [for] 'gross neglect’ of my duties as to the cause of my employees’ failure to conduct the...drawing in accordance with the approved...procedures.” That question of possible discipline, again, is on hold.

Commissioner Michelle Seagull of the Department of Consumer Protection (DCP) said Wednesday she “will open a wide ranging investigation into the operation and management” of the Connecticut Lottery Corp. — potentially adding to the woes of the gaming agency where turmoil has become the norm.

The...

Throughout his complaint, DuPuis recounted what he has told a state auditor, Tim LePore — who was assigned to investigate what two state legislators in March characterized as “the appearance of selective investigation and retaliation" against DuPuis.

Those legislators — Senate Republican Leader Len Fasano and Rep. Joe Verrengia, co-chairman of the legislative public safety committee — suggested that the lottery’s disciplinary proceeding might be payback for DuPuis’ "forthright testimony" during investigative hearings last year into the 5 Card Cash scandal.

They asked the state Department of Consumer Protection, which oversees the conduct of lottery games, to investigate — and that department referred their request to the Auditors of Public Accounts, who by April assigned LePore to the inquiry that’s still ongoing.

‘Potential Fraud’

DuPuis said in his complaint that “to provide a historical background as to my belief of retaliation, I told Mr. LePore that in January 2016, I had advised the [lottery’s] then President & CEO, Anne Noble, of my knowledge of the potential fraud” in the 5 Card Cash game. He said that he’d already advised Noble in April 2015 that the game “had a great potential for retailer fraud and suggested fraud mitigation actions to deter or prevent it” that Noble “declined to consider.”

DuPuis said that the consumer protection department had later “conducted a full investigation and determined that fraud resulted in a $2 million loss to the state.”

His complaint then fast-forwarded to this past Feb. 22, when DuPuis said the lottery’s former board chairman/interim CEO, Frank Farricker, contacted him after reading news of the pending disciplinary action. DuPuis said that Farricker “felt compelled to tell me ... [that] he was certain the ‘gross neglect’ charge against me was in retaliation for my uncovering the fraud scheme in the 5 Card Cash game” — as well as “the reporting of it to the Department of Consumer Protection...which resulted in the resignation of Anne Noble as the president & CEO.”

Noble stepped down as CEO in September 2016, amid the consumer protection agency’s investigation of 5 Card Cash, but didn’t attribute her decision to the probe. She entered a lucrative separation agreement that kept her on lottery’s payroll until 2017 and enabled her to qualify for state retirement benefits.

Frank Farricker, the Connecticut Lottery Corp.'s ex-board chairman and acting CEO, has paid $11,318 to settle a complaint by the state Office of State Ethics over thousands of dollars in reimbursements he received for personal expenses including home cable TV, his personal cellphone, and internet...

Farricker filled in as interim CEO until May 2017, when he resigned after first attempting to become permanent CEO. Later in 2017, Farricker also paid a fine to the state’s ethics agency for billing the lottery for expenses including his home cable TV, personal cellphone and internet service.

Farricker was immediately succeeded as interim CEO by Chelsea Turner, who had been hired originally by Noble as the lottery’s chief of strategy and government and operational affairs, after the two had both worked in the office of former Gov. M. Jodi Rell.

It was in that interim CEO’s role that Turner placed DuPuis on the leave in February, after the internal investigation found the alleged “gross neglect.”

DuPuis said in the complaint that both Noble and Turner, “who is Noble’s longtime protege, personal friend and coworker [in Rell’s office]”, had talked against him, according to Farricker.

“Mr. Farricker told me that Anne Noble came to him and the Board of Directors during the 5 Card Cash fraud investigation, on at least three occasions, asking to terminate my employment … as the director of security, citing ‘issues with Fred’ ... In addition, Chelsea Turner ... came to Mr. Farricker when he was the [acting CEO] after Anne Noble’s departure, to ask him to consider terminating me for ‘not being a team player’ and for ‘conspiring with the Department of Consumer Protection to get Anne Noble removed, amongst other things...’”, DuPuis’ complaint said.