California lottery is still under investigation by Justice Department, workers say
An investigation into the California State Lottery launched by Gov. Jerry Brown’s office 18 months ago remains open, according to people who spoke with attorneys from the Department of Justice.
Brown asked for the inquiry from the Attorney General’s office in August 2018, after his office received an anonymous letter on lottery stationery that described mistreatment of public employees and questionable behavior of senior department leaders at sales conferences.
The letter included photos that allegedly depicted senior lottery officials at a Southern California piano bar, with one putting his head under up a woman’s shirt.
Brown at the time also requested an enhanced audit by the State Controller’s Office on lottery spending. The Controller’s Office published that report in April 2019, detailing overspending on travel expenses and other accommodations for sales conferences.
An investigation by the Attorney General’s office is considered especially serious because prosecutors could recommend criminal charges if they find wrongdoing.
Sharon Neal, a longtime lottery district sales representative, said she spoke with attorneys at the Justice Department for the investigation nine or 10 months ago. She was not one of the employees who wrote the letter, she explained, but she recognized the claims of unfair hiring practices, retaliation and managerial abuse.
“(DOJ) acted like they were really concerned about checking in with the things that we were talking about. So I thought, ‘good, they have someone to finally pay attention to what we’re seeing and to put it in check,’” Neal said. “And that has not happened.”
But Neal said that nearly a year later, many of the managers she alleges have committed wrongdoing are still there.
“It’s a Monopoly game, some kind of get-out-of-jail-free card,” she said.
Last month, another lottery employee who spoke with the Justice Department received a message from an investigator saying the review would be complete in “the next month or so.”
The investigation might not become public even when it is complete.
The Attorney General’s office considers the investigation to be privileged material for its client, the Governor’s Office, a Justice Department spokeswoman said. That means it’s up to Gov. Gavin Newsom to release or discuss the findings.
In 2017, Brown requested a similar review of a California tax agency called the Board of Equalization after audits revealed wasteful spending and questionable hiring practices.
Board of Equalization employees reported meeting with Justice Department employees. Neither the Governor’s Office nor the Attorney General’s Office released any description of the investigations conclusions.
Both rejected California Public Records Act requests from The Sacramento Bee seeking summaries of its findings.
The Governor’s Office did not respond to a request for comment on the status of the lottery investigation.
On Tuesday, the State Auditor’s office released a separate report on the lottery, which indicated it had shortchanged California schools by $36 million. It’s a requirement to set aside some money for schools under the 1984 ballot initiative that created the agency.
Neal said she’s now on extended leave, taking time to see how things play out in the department and with the investigation. She said that after more than three decades at the lottery, she’s leaving with a “disconcerting” perspective of her employer and few expectations of the DOJ’s final conclusion.
“A lot of trust has been lost,” she said. “At this point, I anticipate disappointment.”
This story was originally published February 25, 2020 at 3:48 PM with the headline "California lottery is still under investigation by Justice Department, workers say."