What about Novomatic?
It all started with the corruption scandal last August involving the owner of Novomatic AG, billionaire Johann Graf, the company Casinos Austria and the far-right politician Heinz Christian Strache. A few weeks ago the police again entered the offices of the Austrian gaming giant. An affair worthy of a movie.
Things have gotten interesting at the offices of Novomatic AG. After the corruption scandal last summer, the police have again investigated the Austrian giant. ©PeterHass/Wikipedia
Everything was precipitated when Peter Sidlo, a member of the Freedom Party (FPÖ), was appointed to the council of Casinos Austria AG (CASAG). The corporation operates more than 40 physical casinos in 18 countries around the world.
Casinos Austria is a complicated business. The Austrian state has a stake in the corporation, as well as Novomatic . The third in discord is Sazka Group , a lottery operator with a presence in the Czech Republic, Greece, Cyprus and Italy.
Just a few days ago Novomatic announced that it was selling its stake in CASAG , and having renounced the state agency ÖBAG (Österreichische Beteilungs AG) to its right of purchase, the Sazka group took the shares of Novomatic and controlled 53% of Casinos Austria.
One night in Ibiza
Seem the script of a movie . Corruption, sex, mafia and politics..., all in the hot surroundings of the Ibizan summer. In May 2019, a videotape recorded in July 2017 came to light in which the then Vice Chancellor Heinz-Christian could be seen Strache offering public contracts in exchange for financial support the alleged niece of a Russian oligarch.
Novomatic AG is mentioned by Strache, who boasts in the video of receiving donations from the company. Although Strache declared that it had all been the product of alcohol and that he had fallen into a trap, Austrian public opinion did not forgive him ; the electorate, by the way, neither. The Ibiza Case, as it is known, ended the Austrian politician's career and the FPÖ government.
In the midst of all this is the appointment of Sidlo to the CASAG board. Already controversial in itself, as Sidlo lacked experience for the position. The Austrian parliament starts investigating in November and the prosecutor's office orders a raid on Novomatic offices , as it is thought that the company would have benefited from the appointment of Sidlo.
The corruption scheme puts a the gaming industry in the Alpine country under suspicion . The starting point would have been the intention of Strache and company to end the monopoly of the game held by CASAG in Austria. Novomatic could have benefited by being promised gaming licenses in exchange for financial support.
Novomatic has denied any involvement in the matter , claiming that his position at CASAG is merely advisory. But the historical ties of Novomatic with the Austrian government, of whatever color, are undeniable.
As things stand, the corruption scandal may precipitate the legislation of a regulated market in Austria. Many agents in the sector do not see with good eyes the relationship of politics with a semi-state company of a monopolistic nature.
So far, operators can only get licenses if they are part of CASAG, otherwise they are considered illegal under the current system. However, around the 70% of revenue from online gambling they are generated in non-legal casinos. A clear example of the need for a regulated market .
With the police hot on their heels
Although Novomatic has already disposed of its stake in CASAG, which it has sold to the Sazka group, this has not prevented investigations into the corruption scheme continue . Now it is also the Institut für Sicherheitspolitik (PSI), led by Markus Tschank, a former FPÖ deputy, and which would have received $ 240,000 from Novomatic, a sum that would have been camouflaged in this way at the Institute, although its final destination could have been another.
For now it's all speculation . But the investigations that began with the scandal of Vice-Chancellor Strache promise a lot. Austrian politics is reeling and with it some of its most illustrious businessmen.
Harald Neumann, CEO of Novomatic AG he has submitted his resignation . Although not because of the police investigations, but, for family reasons, Neumann has alleged. He will remain linked to the group.
