For decades it offered people the hope, or the illusion, of potential riches. It appeared to be a benevolent charity that was channelling vast sums into an underfunded Irish medical system. Granted, it caused ructions around the globe because it was a popular but illegal lottery, but there was something poetic, or ironic at least, in the idea of British and American gamblers funding the Irish health service.
Of course, like so many apparently altruistic Irish institutions, it was mostly a sham, a money-grabbing masquerade designed to enrich a small number of already wealthy individuals. The Irish Hospital Sweepstakes, bears out the axiom that if something is too good to be true, it’s probably not true.
The first draw, in November 1930, was, in retrospect, utterly distasteful, but wonderfully stage-managed by the organisation’s own P.T. Barnum, Spencer Freeman. Two young boys from St. Joseph’s School in Drumcondra, both blind and wearing placards bearing the names ‘Willie’ and ‘Peter’, were supervised by Garda Commissioner, and future Fascist, Eoin O’Duffy, in drawing the winning tickets. Later the blind children would be replaced by smiling nurses. Three delighted Belfast men shared an astronomical and life-changing prize fund of £208,792. The Sweepstakes was well on its way to becoming the employer of up to four thousand people. The surplus was destined, after the deduction of appropriate administration costs, of course, to heal the sick. Everyone was a winner.
Except that everyone wasn’t. Less than ten percent of the turnover—still a considerable sum of money— found its way to the funding of Irish hospitals. Employees, mostly female, were badly paid, and much of the turnover enriched the stakeholders in the private company that ran the enterprise.
The Irish Hospital Sweepstakes was the brainchild of Dublin bookmaker Richard Duggan, War of Independence veteran Joseph McGrath, and Welsh-born Captain Spencer Freeman, a man with a flair for the theatrical. By 1932, after two years of clever marketing, illegal sales, and excessive point shaving, all three were millionaires.
The Sweepstakes also affected political relationships between Ireland and, in particular, Britain and the USA, where the sale of lottery tickets was illegal, but widespread. For their part, the British governments of the 1930s were not best pleased that millions of pounds were leaving the country illegally, bound for Eamon de Valera’s Irish Free State, in the midst of an economic war between the two countries.
In America McGrath’s erstwhile political ally, the veteran Republican Joe McGarrity, was in charge of operations. He wrote in his memoir that he used much of his own considerable personal profits from the venture, to purchase IRA guns. This was at a time when that organization was collaborating with Nazi Germany. Recently opened Secret Service files in London revealed that MI5 had fears that the same thing was happening in Britain.
Among the abuses of which the operators stood accused was a sort of ‘past-posting’ scam. Exploiting the time difference between Europe and the USA, the operators purchased shares in winning tickets from their unwitting holders, and claimed some of the prize money themselves. In 1936 Spencer Freeman, armed with the results of races, used this system to purchase half-shares in eight successful American tickets. He netted nearly a quarter of a million pounds in winnings from his own lottery. By the 1970s the directors had creamed off more than a hundred million pounds in profits.
And, surprise surprise, some of the proceeds from the Sweepstakes were allegedly used to fund the campaigns of friendly Irish politicians.
One distinctly unfriendly politician was Justice Minister Des O’Malley, who, in the 1970s, sought information on the allocation of the turnover from the lottery. So powerful was the Sweepstakes that he was pressurized into minding his own business. The government was reminded that any adverse publicity or punitive action against the directors would lead to the loss of hundreds of jobs. When, in 1973, the journalist Joe McAnthony finally exposed some of the dubious activities of the lottery in the Sunday Independent, all the Sweepstakes’ advertising in the newspaper was pulled.
When An Post was awarded the franchise to run the new National Lottery in 1986, that was the end of the Irish Hospital’s Sweepstakes. Its employees—mainly elderly women—were discarded, with virtually no provision being made for them.
The notion that it was all ‘great craic’ and, from a hospital’s point of view, better than a poke in the eye from a sharp stick, has its champions. However, at the very least, it is yet another example of the fledgling Irish State farming out vital services to bodies with an agenda of their own. In this case, that of making large fortunes for themselves.
The first winning tickets were drawn in the Irish Hospital Sweepstakes lottery, eighty-seven years ago, on this day.
[Read this book if you want to know more]