Rangiora man accused of making $11m in NZ’s largest illegal lottery
Friday, 17 May 2024
A Rangiora man is accused of running New Zealand’s largest illegal lottery, which allegedly generated over $11 million in little over a year.
Waiariki McIlroy-Jones, the 23-year-old owner-operator of Jonez LRC, has been accused of running an illegal lottery over 2022 and 2023.
He allegedly personally benefited from selling illegal lotteries online, with prizes including high value cars, jet skis and even a freehold house.
Did you buy entries to a Jonez LRC “give away”? Email sinead.gill@stuff.co.nz in confidence.
His charges, which are representative - meaning they are alleged to have occurred more than once - each carry a maximum fine of $20,000 or one year imprisonment.
Through Jonez LRC, he sold “packages”, which included several entries to a draw to win what Jones described online as “life changing” prizes.
The company faces a maximum $50,000 fine for each of the charges it faces.
McIroy-Jones and his company face six representative charges each - 12 in total. They are of conducting illegal gambling, promoting it, and making a pecuniary gain from it.
The Department of Internal Affairs (DIA) said in a statement that Jonez LRC will go down as the largest illegal lottery ever identified in New Zealand, if charges are proven.
The Press began covering the DIA investigation into Jones in July last year, after investigators seized 19 vehicles that were in Jones’ name, including a 1970 Ford Falcon and a yellow 1992 Mazda RX-7, and five vehicles in the company’s name.
Jonez LRC also had two properties seized. McIlroy-Jones was in the process of awarding his biggest prize yet - a freehold home in Rangiora - when the DIA stepped in.
At the time, Jones told The Press the company was making a profit, but insisted he was doing nothing wrong.
The more people spent, the more entries they got. Upon receipt of purchase, people were encouraged to buy more discounted ‘packages’ within a tight time limit.
Winners were drawn using a machine with lottery balls, in an Instagram livestream to as many as 70,000 followers.
Jones said he was running “trade promotions”. The package people bought included temporary access to discounts at retailers across Aotearoa, he said.
A sales promotion is a type of marketing exercise for a company and its goods or services. Speaking to The Press in July, Maria Bellringer, director of AUT’s Gambling and Addiction Research Centre, questioned what goods or services Jones was selling, as he appeared to only promote future give aways on Jonez LRC social media channels.
At the time, Bellringer said Jonez LRC’s practices seemed “predatory”.
“It looks like gambling to me,” she said.
Some of Jones followers claimed to spend $100 or more every week on entries. In one comment, Jonez LRC said at least one person spent $1000 on entries every week.
Jones continued to post to social media while the investigation was ongoing. The comments section was full of people thanking Jones for his work, but many also asked if they would get refunded for the Rangiora house raffle which never went ahead.
A Christchurch woman, who asked to remain anonymous, paid $50 for entries into a Rangiora house “give away”. The winner would get the house, worth about $900,000, or $650,000 cash. She said her email receipt came with a 50% discount if she made another order in the next 10 minutes, which she did.
Some early livestreamed draws were done alongside Richard Peters, a Rangiora-based justice of the peace, who Jones used to authenticate high-value prize winners.
Peters told The Press last year he took Jonez LRC at its word that what it was doing was legal.
Under the Gambling Act 2003, it is illegal for companies to gamble prizes exceeding $5000 without a class 3 gambling licence, in order to ensure the integrity of the operation and protect participants.
Vicki Scott, director of gambling at DIA, said: “Our strict licensing requirements are there for a reason. We will not hesitate to respond firmly when we see instances of illegal gambling such as unlicensed online lotteries.
“We have no tolerance for those who seek to profit by bypassing the rules.”
Police have also taken proceedings in the High Court against Jones and his company under the Criminal Proceeds (Recovery) Act.
Jones’ next court appearance is June 6.