Norsk Tipping’s recent prioritization of innovation and new product development has inadvertently led to significant quality and control issues, as reported by an audit conducted by PwC. These challenges have culminated in a series of notable errors, placing the operator under scrutiny.
The operator has been subjected to multiple sanctions over recent months, primarily concerning its lottery games. Norsk Tipping is currently facing the prospect of paying more than NOK110 million ($11 million) in financial penalties due to these operational shortcomings.
In response to these failings, Norsk Tipping’s board commissioned PwC to conduct a thorough review of its primary lottery offerings, notably including Lotto, Vikinglotto, and Eurojackpot. The audit revealed a critical focus on innovation and development that overshadowed essential aspects of quality and control.
PwC’s analysis highlighted several core issues, including unclear leadership roles and responsibilities, and insufficient follow-up with suppliers. The report noted that despite an extensive control framework in place, there were notable deficiencies. These included the balance between achieving innovation and maintaining stable operations, clarity within roles and responsibilities, and systematic management of deviations.
Importantly, PwC observed that maintenance and internal controls were sometimes neglected in favor of developing new technologies. Norsk Tipping’s acting CEO, Vegar Strand, acknowledged the seriousness of the findings and extended apologies to affected customers, emphasizing the operator’s commitment to addressing these vulnerabilities. It was clear to Strand that even though many aspects function well, the vulnerabilities identified by PwC were too significant to overlook. “Every stone will be turned to ensure we both learn from our mistakes and build a new and better Norsk Tipping,” he declared.
Positive steps towards rectifying these issues have been noted. Some corrective actions were in place as early as February, preceding the public disclosure of these failings. PwC detailed these actions, noting that Norsk Tipping had deferred certain development projects and redeployed over 150 staff members to focus on enhancing current operations since May.
Moreover, Norsk Tipping has augmented its lottery process controls, introducing greater oversight during execution by replacing manual checks with automated systems to minimize human error. The organization also initiated an external review of critical processes to identify risks and prevent legal breaches, resulting in over 300 quality measures being implemented.
Since June, the operator has been under the interim leadership of Vegar Strand, following the resignation of former CEO Tonje Sagstuen. Sylvia Brustad, a board member, emphasized that while the report pinpointed areas for improvement, significant corrective measures had already been implemented months prior. She expressed confidence in the company’s ability to learn from these errors and emerge stronger.
KPMG, in a parallel review, focused on the Eurojackpot draw issue, where 47,000 players were incorrectly informed of winning excessively high prizes on 27 June. This error may lead to an additional NOK10 million penalty pending a decision from Norwegian gambling regulator Lotteritilsynet.
KPMG identified that while procedural routines existed, they had gradually weakened due to structural changes, shifting priorities, and reallocations within the organization. Their findings emphasized an environment where innovation, speed, and performance were prioritized at the expense of quality control.
The Eurojackpot incident is one among several issues faced by Norsk Tipping recently. In September, a penalty of NOK46 million was imposed over a technical failure affecting Eurojackpot and Lotto, which unfairly advantaged players in cooperatives and gaming clubs. In March, another NOK36 million fine was announced following a bug that prevented self-excluded players from blocking their access to Norsk Tipping accounts. Additionally, the company was fined NOK2.5 million in 2024 after erroneously awarding NOK25 million in winnings to a player.
In late September, Norsk Tipping was informed of a potential penalty of NOK25 million related to a technical error in a “super draw” in April, which incorrectly declared 52 players as winners. These incidents underscore the challenges faced by Norsk Tipping amidst its current strategic focus.
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