Part 1 ... About Director Sadberry and The SAO's 2006 Security Report ...

The Hodgepodge Page
Continued ...

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A Four Part Series
- Part 1 - June 6, 2006 - About Director Sadberry and
the SAO Security Report, Scroll Down
- Part 2 - June 7, 2006 - Are the TLC Employees Happy
Now? - Click Here
- Part 3 - June 15, 2006 - SAO Reports, About the Integrity
of our Games, Scratch Tickets, Plus Much More ... Click here
Part 4 - In Memory of Mark Bradshaw - Click here


June 28, 2006 - Anthony Sadberry was named Executive Director of the TLC today. Now comes the true test ... will he "really" fix things? I told you all about him in the June 6th entry, just scroll down to the 4th paragraph to start reading about him. We wish him much success in his new job.

June 6, 2006 - Part 1 of a 4 Part Series - It's been almost one year to the day that the TLC falsely advertised a Lotto Texas jackpot amount but this time they got caught. And yes, it was me who filed the complaint with the AG. As usual, the TLC initially denied inflating the jackpot to the media but finally admitted it.

A lot has happened since then. With this writing, which is going to come in a 4 part series, I'm going to try to bring you up to date and answer all those questions you been asking me for the past 6 months. Many of you think that all my news is posted on this page and are thinking that I've been quiet for too long because I haven't updated this page since last Nov. Because of this, I want you to go to my site map - that's in dire need of organizing - and review all the postings for Nov, Dec, Jan, Feb, March & April. You'll find stories about fired employees, the Lotto Texas rule change including an in-depth summary regarding players comments and the recent deceptive advertising, the lawsuits filed by Ex-TLC employees, hearings at the capitol regarding the allegations & the news regarding the search for a new Executive Director. This has been the news for the past 6 months.

Now let's move forward to update and answer your questions regarding Acting Director Anthony Sadberry i.e. ... what changes he's made and about him personally, the Lotto Texas game change, the four (4) audits under way by the State Auditors office, about the fired employees who have sued (Shelton Charles, Cindi Suarez and Steve Martin) and other matters of interest like are the employees happier now, do we have truth in advertising yet and my list goes on and on.This is why this will be a 4 part series!

Let's start with Acting Director Sadberry
Sadberry took over as Acting Director in Jan 2006. Gary Grief was named Deputy Director but he got a raise. In fact, he makes more money than Sadberry does. Anyway, you must remember that Sadberry stepped in at a time when all hell was breaking loose and he has had to learn the lottery business, handle massive outside investigations and employee relation problems plus the lawsuits facing the agency.

For those of you who have asked just about him as a person - here's a summary. He was born in Caldwell, Texas (1949) and is married with one daughter. He graduated from UT - Austin and got his law degree from Georgetown University Law Center in Washington in 1975. He worked for the TX AG for 2 years (1975-1977), then various law firms in Houston and San Antonio. He was also self employed a couple of times. He served as a TLC Commissioner from 1993 - 2001. Before becoming Acting Executive Director in 2006, he had returned to work with the TX AG.

The only problems that I've identified from his recent past was a problem with the IRS in 2004. After reading the court papers, I choose to believe it was an honest mistake on his part. As for the outcome, I do not know - I have not asked. I am aware that some of you do not agree with my assessment of this situation and I'm sorry that we disagree. I do, however, want to thank you for sharing the information with me and as you can see, I am posting this very public information.

It is too soon to judge Sadberry in his role as the acting director. He's done one thing that disappointed me and that was when he went along with staff regarding the Lotto Texas rule change to 6/54. He did NOT listen to the People of Texas. Players favored a straight six game but they were adamantly opposed to picking from a pool of 54 numbers. The comments clearly indicated the people wanted their original 6/50 game back.

On the other hand, he's made two changes so far that I applaud.

1) Sadberry reduced the job responsibilities of Gary Grief, Kim Kiplin, Mike Fernandez. (Link is to my July 2005 posting about these folks) Effective May 1, 2006, Diane Morris is no longer employed with the TLC. Rumor has it that Diane is gone because of an incident with a BINGO employee and Diane left instead of the BINGO employee.

In Feb, Sadberry sent out the following message regarding staff changes:

Subject: Agency Organizational Structure

Based upon my review of the current agency organizational structure as well as discussions with the Commissioners individually and the Deputy Executive Director, effective immediately I am making some changes to the reporting structure that will enhance the operation of the agency.

These changes are summarized below:

Legal Services Division
To best utilize my experience and knowledge in legal and contractual matters, along with my intent to focus on those areas and accompanying issues facing the agency, the General Counsel will report directly to me. (Legal did report to Gary Grief, not Reagan Greer.)

Governmental Affairs Division
To best allow me direct interaction with agency staff on matters
involving the legislature and state leadership offices, the Governmental Affairs Director will report directly to me. (Governmental Affairs did report to Gary Grief, not Reagan Greer)

Media Relations Division
To best allow me direct interaction with agency staff on matters
involving the media and better facilitate the management of the public message coming from the agency, the Media Relations Director will report directly to me. (Media Relations did report to Gary Grief, not Reagan Greer)

Human Resources Department
Based on my preference for executive management to be more directly involved in the oversight of employment matters and to ensure that the human resources function is appropriately placed in the organizational structure, this department will report directly to the Deputy Executive Director and will be renamed the Human Resources Division. (HR reported to Mike Fernandez who is Director of Administration)

These organizational changes are meant to facilitate and not diminish the level of interaction and professionalism of the management team. Notwithstanding these changes in the reporting structure, I will continue to utilize a team approach in the ongoing management of the agency.

Thank you in advance for your full cooperation and support of these changes. I will continue to review the organization and its functions and activities. ajs

The second change that I applaud is the recent [May 22, 2006] restructuring of what they started calling the "Enforcement Section" back in 2004 under Gary Grief's big re-org. This is when he [Grief] gutted Security and created an "Enforcement Section" that fell under the "Legal Division." The two or three people that remained in what they called "security" answered to Operations. Grief essentially did away with the "Security Division." Well, Mr. Grief sent the following message to all staff members on May 22, 2006, 5:23 PM. As you will see, we now have a stand alone DIVISION - called "Enforcement" - but in layman's terms is in reality the same as "security." Enforcement now answers to Sadberry, not Ms. Kiplin, and is a stand alone division again. You can rest assured that Sadberry made this change because Grief said he'd "never put security back."

From Gary Grief - Sent to all staff members -
May 22, 2006:

In the interest of keeping staff informed of significant agency
organizational changes in a timely manner, I provide you with the
following information.

Effective immediately, the Enforcement Section of the Legal Services Division has been restructured as a stand-alone Enforcement Division with a division director position established as the administrative head of the division. On an interim basis, Ed Rogers has been appointed to serve as Acting Enforcement Division Director. The Enforcement Division Director will report to the Executive Director.

The Enforcement Division will be comprised of the new division director position along with the current investigators, intake specialist, background specialists and certain administrative staff. The attorneys, legal assistants and certain other administrative staff previously a part of the Enforcement department have been reassigned to the General Counsel section of the Legal Services Division.

Due to Ed temporarily vacating his position in Lottery Operations to take on this new role, Pamela Williams has been named Acting Manager of the Retailer Services Section in the Lottery Operations Division.

Please join me in giving Ed and Pamela your full support in their
important new roles for the agency.


The interesting twist to this move is that on May 3, 2006, the State Auditors submitted TWO Security Reports. One was a "public" report and the other was a "confidential" report.

The "public" report states, "The Commission underwent a significant reorganization in Nov 2004. The reorganization included a reduction in force that could have affected some security functions. Auditors concluded that the reorganization did not have a materially adverse effect on security." But please notice - there is now a stand alone Enforcement Division! Imagine that.

My interpretation of the "public" Security Report confirms the allegations made by Shelton Charles last year. If you will recall, he was the fired ex-employee that I called a Hero. It clearly says that "resumption of lottery games after a disaster is completely dependent upon the contracted lottery operator [G-Tech]"

Additionally, the report says, "The Commission has "procedures" that enable it to resume the operation of internal administrative systems that support only the Commissions internal accounting systems and other internal processes, but it should continue improving those procedures." Having "procedures" is not the same as saying that they can resume business as usual.

The report also states that the Commission should "document critical systems in its disaster recovery plan and identify, perform and document formal tests of recovery operations." The State Auditors are saying that things are "generally" satisfactory in this audit. When I was in school, this was a C in grade language!

The State Auditor's report outlines concerns regarding lottery security. The auditor specifically recommends the Commission implement controls ensuring that Texas lottery prizes are not awarded to "ineligible players"..."the Commission lacks controls to prevent or detect the payment of lottery prizes to those individuals. The Commission also should improve its annuity payment tracking process." But things are "generally satisfactory?" One has to wonder, what did they REALLY find?

Sources familar with computer securities have described the TLC as having a "hackers paradise." While I'm not going to elobrate on this issue, I found the reasons for making such claims quite interesting. In fact, I actually learned some things that I've implemented on my own computer! So thanks for the education guys.

Shelton Charles said three very important things last year - 1) He said that it would take a great deal of money to complete the Disaster Recovery site, 2) that it's never been tested so how could anyone claim that it was "up and running?" And 3), employees work in fear of being fired.

If you'll watch the May 26, 2006 hearing held by the Appropriations Committee, you 'll see how the discussion of money needed for the Recovery Site was discussed and you'll also see how the legislature verified that money WOULD be spent in this area. Hey, if all was OK - why spend money? To me, this sure sounds like they are finally going to get the Disaster Recovery site operational now!

Note: To watch this hearing, click Appropriations Committee above then click under "Interim Broadcasts" - Sub Committee on General Government, May 26, 2006. When Real Player opens, fast forward to 3:55:25 pm even though the end time on the link shows 3:44 pm. This is the start of the TLC's 20 minute testimony. What you'll see is the LBB (Legislative Budget Board) testimony first, the State Auditors staff will give their security report second then the TLC will give a report followed by a BINGO report.

Shelton Charles has sued the TLC and he alleges that the Disaster Recovery site was not operational. While the state can get away with keeping some things from us and saying that things are "generally satisfactory," the state will not be able to keep people from testifying in court and telling it like it REALLY is! This is when we will get straight, direct answers to our questions and the whole truth will surface.

I also want to respond to those of you who called me last Feb asking that I give Sadberry a heads up for you. I tried to talk with him alone but was NOT successful. Therefore I did NOT give him your warnings. I did, however, tell another party there in Austin and I can only hope that he got the message.

The TLC decided last Dec 2005 that I WAS a "member of the press" so now no one is allowed to speak to me directly. This is why Sadberry was hesitant to speak with me alone. Remember when they said I was NOT a member of the press and cut off my communications for 2 to 3 years? I finally filed a complaint with the AG and miraculously got info coming to me again.:)) BTW - It was Gary Grief who gave me my faxes back.

Does Sadberry have "team players" on his watch?
Sadberry can't know everything in his first 5 months on the job and he depends heavily on staff to advise him. Well, it appears his staff isn't doing their job very well because 1) the organizational structure has not been updated on the TLC web site and 2) Diane Morris is still shown as the HR Director under "agency contacts." She's been gone 1 month and 6 days. As Gary Grief would say or has said, "that's not my job." :)) But when Gary was in the ED position, these changes were always made immediately. I can't help but wonder, did anyone advise Sadberry to update the web site? Are those who report directly to him really "team players?" These are just a couple of examples I can quote on this subject ...

Coming tomorrow, June 7 - PM - About those "draft" reports vs the "final" public reports. Are TLC employees happier now ... do they feel comfortable enough to speak their minds freely and without fear of retaliation? here to read more


A Special Message To All
TLC Employees - Past & Present

Click here.

- Don't Be Misled - A Legend Has NOT Returned -
Read all about the new Lotto Texas game that we will be playing
effective 4/23/06. Lower prizes, less money in the prize pool and
there's no guarantee that we'll receive our share of sales. Click here.

Sad but True & Educational Winning Stories
18 new stories posted 3/15/06 - I'm catching up!
Click here

Whistleblower Lawsuit Filed by
Former TLC Employee - Shelton Charles
Feb 2, 2006 -
Press Release - This is the 2nd lawsuit filed!
Feb 3, 2006 - Added Houston Chronicle Story
Revised: Feb 8, 2006 - Added Austin American Statesman Story
Read Newspaper Stories, Click here
Read The Petition That Was Filed With the Court, Click here (pdf)

Ex-Employee Sues TLC - Jan 31, 2006
They are calling for trial by jury ... this will be interesting.
One has to wonder, are more lawsuits in the works? Click here.

Told Ya So
About me, Judicial Watch & the cheated winners
Dallas Observer, posted 8/11/05 - Click here

A Dallas Observer Feature Story
My hats off to the Dallas Observer and reporter, Rick Kennedy,
for a fantastic feature story about my life since I decided to keep an eye
on the Texas Lottery. I finally posted his story, added links and comments.
Click here
to read. (June 11, 2005)

Texas Lottery Denies Cheating Lotto Texas Winners
But excerpts from Commission Meetings refutes the TLC claims
of innocence. The complete story including a winners complaint letter
to the DA, excerpts and a spreadsheet showing the wins. Click here.


Just point and click

The Lotto Report
Dawn Nettles
P. O. Box 495033
Garland, Texas 75049-5033
(972) 686-0660
(972) 681-1048 Fax