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Attorney: Geddings Feared He Would Lose Commission Seat

Posted September 28, 2006

— Former state lottery commissioner Kevin Geddings feared losing his seat on the commission if state regulators knew about his previous work with a for-profit lottery company, an attorney testified Thursday at Geddings' federal fraud trial.

Ira Raphaelson, vice president and general counsel at Scientific Games Corp., said he discovered the company paid Geddings' public relations firm $24,500 in 2005.

Raphaelson, then an independent attorney hired to review the company's spending in support of creating the North Carolina lottery, said he told Geddings the company planned to tell the state about the payment because "it was a potential embarrassment" and could harm the firm's efforts to win lottery business in North Carolina.

Raphaelson said Geddings told him the payment was mostly for work performed in South Carolina, adding he would be "done as a commissioner" if it became public. Geddings "came pretty close" to specifically asking him not to make the payment public, Raphaelson said.

Prosecutors have accused Geddings of failing to disclose to the State Board of Ethics that his Charlotte-based public relations firm received more than $250,000 from Scientific Games or companies it acquired. He is charged with eight counts of fraud and faces up to 20 years in prison and thousands of dollars in fines on each count.

Named to the lottery commission in September 2005, Geddings resigned less than six weeks later, five days after his conversation with Raphaelson and hours before Scientific Games disclosed the $24,500 payment. The New York-based company was later an unsuccessful bidder for work with the state's new lottery.

During cross-examination Thursday, Geddings' attorney Thomas Manning asked Raphaelson if he believed Geddings was required to release payment details to state officials.

"I didn't know what was required of him," Raphaelson said.

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