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ARKANSAS LEGISLATORS QUESTION LOTTERY FINANCIAL OFFICER
August 26, 2011

A few days ago, the chief financial officer for the Arkansas State Lottery said that a data input error caused a $90,000 tax penalty. However, legislators are not sure why the Lottery’s director was kept out of the news for more than 3 months. Lottery numbers

Ernie Passailaigue, the Arkansas State Lottery Director, told the members of the Lottery Oversight Committee that he was extremely “disappointed” by the fact that nobody told him about the problem with the Internal Revenue Service so long after the problem came up. National lottery

The IRS penalized the lottery because some tax withholdings from prizes were paid very late. The Lottery Director said the payments are now made every day so a similar problem will be avoided. He also believes the IRS is not exactly right, at least over part of the payments in question. Ernie Passailaigue said he learned of the problem on August 10, while Philip Miley, the chief financial officer, received a notification from the IRS back in April. Lottery results

Senator Jonathan Dismang, said the officials of the state lottery should make sure that important issues such as these are known by the director, the legislative committee and the Lottery Commission.

“I’m not sure if I still follow the chain of command and why there was the misstep and why there was no internal control to make sure there was the correct communication between the director and the CFO,” Senator Jonathan Dismang told after the meeting.

During the meeting, Senator Dismang asked Senator Johnny Key and Representative Mark Perry, the legislative committee’s chairmen, to send a letter to Philip Miley and ask him about what happened and why he didn’t tell the lottery director.

However, Philip Miley joined the committee meeting a bit later and told the legislators he believed the IRS would negate the penalty. He told the lottery director about it this month, after the IRS denied the lottery’s challenge. Miley already gave a notice that he will quit his job next month. Also, he said that telling the lottery director about the IRS problem was a “part of his wrap up, to let the director know about significant issues that were happening.”

That’s about it on the matter for now. Please join us again soon if you want to learn more news about any particular state lottery or about lotteries in general.

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