Intralot, the Greek gaming company that previously managed the mobile sports betting app in Washington, DC, could soon face an investigation related to its handling of the platform.

This request may indicate that an investigation is already underway, though court filings on the matter remain sealed by order of the DC Superior Court.

The Intralot deal has been widely criticized, particularly because the contract was awarded without a competitive bidding process, leading some DC City Council members to allege cronyism, similar to the 2009 decision to grant Intralot the city’s lottery contract.

As reported by Alex Koma of the Washington City Paper, the specifics of what Schwalb is investigating remain unclear. However, under DC city code, the attorney general is authorized to examine violations of “false claims laws.” This could potentially lead to financial penalties against Intralot and even a ban on the company doing business in the city in the future.

Intralot’s Changing Role in DC Sports Betting

In March, a significant change occurred when Intralot outsourced its responsibilities for what was then the only sports betting app in the city to FanDuel, a subsidiary of Flutter Entertainment. This move came after GambetDC failed to meet revenue expectations.

The results were immediate: In its first 30 days of operation in Washington, DC, FanDuel’s mobile app and website generated a handle of $30 million and $5 million in gross gaming revenue (GGR) — representing year-over-year increases of 673% and 887%, respectively. The DC sports betting market has since opened to more competitors.

Although Intralot was allowed to delegate its responsibilities under its agreement with the DC Office of Lottery and Gaming (OLG), it still holds the contract with the city. It’s unclear what will happen if Schwalb’s investigation leads to Intralot’s removal, but it’s possible that OLG could establish a new contract directly with FanDuel.

However, it’s apparent that Intralot is struggling to fulfill its financial obligations to the city. According to the Washington City Paper, the DC Department of Small and Local Business Development requires companies from outside the district to allocate portions of their large contracts to small local businesses, and Intralot has had difficulty meeting this requirement.

Intralot has previously cited issues with Veterans Services Corporation, one of its major subcontractors, as a factor in its challenges.

The Future of Sports Betting in Washington, DC

Washington, DC’s sports betting scene is now more competitive than ever, driven by FanDuel and further strengthened by the recent entries of BetMGM, Caesars Sportsbook, and DraftKings. GambetDC is now a thing of the past, much to the relief of bettors who were frustrated with its clunky technology and poor odds, as well as politicians who were disappointed by its revenue shortfalls.

However, this does not mean that Intralot is off the hook. Any investigation into the company’s potential missteps is likely to be thorough.

Schwalb’s inquiry could also shed light on long-standing issues with how Washington, DC awards lucrative contracts — a process that has been frequently criticized and has faced allegations of backroom deals and cronyism.

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