toledoblade.com --

COLUMBUS - The politically connected chairman of a Cincinnati-based online gambling company had the ears of key decision-makers in Columbus as he lobbied the state to sell lottery tickets through his Internet business.

While Roger Ach II pushed Ohio to offer online lottery ticket sales, the chief executive officer of the financially troubled Games Inc. had power brokers working to give him "20 minutes" with Gov. Bob Taft, according to documents released yesterday by the governor's office.

Even after issuing stock to some of the most influential Ohioans - including Ohio Republican Party Chairman Bob Bennett and Brian Hicks, Governor Taft's former chief of staff - Mr. Ach was unsuccessful in convincing the state to put its lottery online.

The Blade first reported on Wednesday that Tom Noe, the former Toledo-area coin dealer under investigation, invested at least $150,000 of the state's money with the company.

Yesterday, Governor Taft said he met with representatives from Games Inc., but he rejected their pitch to sell lottery tickets over the Web.

Mr. Taft met with reporters after a speech at an elementary school in Washington Courthouse, Ohio.

"I think that would be a big mistake for Ohio to be involved in an online lottery," he said. "I'm opposed to it because of the potential for children to be able to acquire lottery tickets."

On June 16, 2003, Mr. Hicks said in an e-mail to Mr. Ach, "The Gov. was going to put a call into you in lieu of a meeting."

Less than a week later, Mr. Ach responded: "As we said in our earlier call, I would much prefer to have 20 minutes in person, rather than a call with you and the Governor in person ... and I have some other things to do in Columbus. Please let me know how he wants to do it."

Mr. Hicks followed up with members of the governor's office on June 26, 2003, writing: "The Gov. said he was going to call Roger. Is that being scheduled?"

On Dec. 23, 2003, Games, Inc. issued 65,000 shares of stock to Mr. Hicks in exchange for "consulting services" valued at $18,850, according to a filing with the Securities and Exchange Commission. Mr. Hicks, who was charged yesterday with a misdemeanor ethics violation for an unrelated matter, left the governor's office on July 31, 2003.

In response to Wednesday's Blade story, the company sent a letter to Tom Hayes, director of the Ohio Lottery Commission, denying that it was a "gambling" company. The letter states it "creates Web-based games" and distributes online greeting cards.

Among other Web sites, Games Inc. runs www.skillmoney.com, whose slogan is "Where it pays to play a round."

"The intent is to add a new dimension into the gaming experience by allowing members to 'wager' on their own skill," the Web site explains. "Even small wagers can make a 'normal game' more exciting."

The Web site has fee-based tournaments where as many as 100 players compete against each other. These tournaments are illegal in 11 states, not including Ohio.

Games Inc. has recently focused on gaming because online lotteries have yet to be approved by any state, a fact that company executives hoped to change by appealing to the Taft administration.

"The Company has also developed software for Internet Lottery Ticket sales," Games Inc. said in an SEC filing. "As it became evident the Internet Lottery ticket sales were going to be adopted more slowly than the Company had anticipated, the Company has focused more of its attention on the games business in general, never losing sight of its ultimate goal of being an electronic lottery retailer."

Earlier this month, Mr. Ach pitched his firm to Mr. Hayes of the Lottery Commission.

Mr. Hayes said he did not expect to do business with Games Inc.

Mr. Hayes is also overseeing the management review team put in place by Mr. Taft to review the Ohio Bureau of Workers' Compensation's investments. That decision was made following the disclosure by Mr. Noe's lawyers that up to $13 million was missing from the state's $50 million rare coin fund he managed for the bureau - an investment that was on the verge of growing to $75 million until The Blade began reporting on the fund in early April.

Mr. Noe invested his own money in Games, Inc., as well as at least $150,000 of the state's money he had been given to invest in rare coins.

William Brandt, hired by the state to liquidate the coin funds, told The Blade that the investment in Games Inc. had already taken place before he began selling off assets more than a month ago.

Mr. Ach, a prominent Cincinnati businessman who has contributed thousands of dollars to GOP candidates, convinced a number of Republicans to invest in the company. At least one prominent Democrat, Jerry Springer, a talk show host, also invested.

Jean Schmidt, a former Republican state representative from the Cincinnati area, also appealed to the governor's office on behalf of a Web-based lottery. Ms. Schmidt is currently running for Congress against Paul Hackett, a Democrat who served in the Iraq War.

The race has attracted national attention.

In a November, 2001, e-mail, Jon Allison, a staff member for Governor Taft, complained that Ms. Schmidt "continues to bug me on Internet lottery."

One year later, her state representative re-election campaign garnered a $1,000 donation from Mr. Ach.

Ms. Schmidt said through a spokesman that she does not remember any conversations with the governor's office about an online lottery, although she does remember that this was a significant issue at the time.

"The documents indicate that she is lobbying the governor on behalf of Roger Ach," said her opponent, Mr. Hackett. "After doing their bidding, she takes a $1,000 donation. That is the culture of corruption - documented."

Blade staff writers Mike Wilkinson and Christopher D. Kirkpatrick contributed to this report.

Contact Steve Eder at:
seder@theblade.com
614-221-0496.

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