Karel Komarek, Czech billionaire whose company Allwyn was licensed to run the UK’s National Lottery, has faced numerous challenges and criticism from both the government and the public.
In addition to technological and financial failures undermining the company’s credibility, investigative journalism has drawn attention to its long-standing ties to Russian businesses, including a mysterious deal for the Samara oil terminal, raising doubts about the transparency of its business.
Technological problems and unfulfilled financial promises
Allwyn has promised not only to upgrade the National Lottery’s technological infrastructure, but also to increase the proceeds for good causes, reaching an annual income of £10bn. However, the first year of management showed that these plans can only remain on paper. A terminal upgrade planned for more than 40,000 UK stores has been delayed by half a year, with prize payout delays, scratch card top-up failures and systemic IT problems sparking criticism from players and consumers.
Russian Samara oil terminal and unclear agreements
The key insight into Komarek’s past relations with Russian businesses was the investigation by Ukrainian journalists from the Kommersant Ukrainskyi about the sale of his Samara oil terminal, located on the Volga, not far from Syzran. According to the journalists, although Komarek’s company officially announced the sale of the terminal as early as 2022, Russian registers indicate the presence of its managers in the company until the end of 2023. A complex scheme was implemented to transfer the terminal to the Czech company Fratron Invest s.r.o., headed by Komarek’s long-time manager Pavel Schwartz. Structures close to the Czech tycoon could theoretically control the terminal through Fratron for at least a year after the announced sale.
Moreover, there is no convincing evidence that Komarek does not control the Russian asset until now. After all, the new owner of the terminal, Andrii Viktorovych Hordieiev, to whom Schwartz sold (or transferred) the rights to the company, is a complete no-name and, probably, is a front person who can represent the interests of both Russians and Komarek.
This, in turn, raises doubts about sincerity of Komarek’s statements about breaking relations with the Russians in general and with Gazprom in particular.
The ‘Gazprom’ past of the owner of the National Lottery of Great Britain
We will remind that for about 20 years Komarek was deeply integrated in business relations with the Kremlin. Together with Gazprom, he built a gas storage facility in the Czech Republic, which is important for Russians’ gas expansion plans and received corporate rights to the terminal mentioned above. The Security Service of Ukraine accused Komarek of the fact that this terminal supplied oil products to Ukrainian territories captured by Russians, thereby sponsoring terrorism.
As for Moravia Gas Storage (MGS), which operated a gas storage facility in the Czech Republic, Russian influence was dominant here. The company’s Board of Directors included ex-Deputy Chairman of Gazprom Oleksandr Miedviediev and other top managers identified by Russian opposition media as former and current employees of Russian special services.
After the Russian invasion of Ukraine, the refusal to cooperate with Russians took much longer than the Komarek company declared. Only in June 2024 did the company complete the buyout of the Russian partner’s stake, seemingly severing the last ties with the Russian business. But the fact of re-election of Ditlif Weidemann, the former head of Gazprom’s subsidiary company in Germany, Gazprom Germania GmbH, to the management of MGS in March 2024 was quite indicative from the point of view of preserving Russians’ influence there. The specified manager represented the Russian, not the Czech, side in MGS.
Dissatisfaction of the UK government and public outcry
The story of the frank prolongation of Komarek’s break with Gazprom and the fact of the powerful lending of Komarek’s projects by Russian state banks for at least 640 million euros caused particular dissatisfaction among British politicians, including Sir Iain Duncan Smith, who pointed to the need for a thorough review of the choice of Allwyn as the operator of the National Lottery. At the same time, some members of Parliament stressed that such a decision risks undermining the trust of the National Lottery as an institution with exclusively charitable goals.
The tender process also sparked debate among British politicians due to revelation of Komarek’s ties to the Kremlin, which could have influenced the decision. Camelot, which had previously held the license since 1994, initially took legal action but later withdrew it when Allwyn bought the company for £120m.
Difficulties with providing financial forecasts
After Allwyn took over, its financial performance fell short of stated projections. Delays in the launch of new games and the lack of updates in pricing policies (for example, the price of a lottery ticket was not reduced from £2 to £1) compounded the financial difficulties. The British Gambling Commission, which approved the license, explains that such changes are normal in market conditions, but politicians and experts doubt the realism of Allwyn’s promises to increase funding for good causes.
Allwyn lobbying and influence in the UK
Faced with a wave of criticism, Allwyn focused on strengthening its image by sponsoring major events. For example, the company supported The Spectator’s annual event and several events at the Labor Party convention to discuss the future of creative industries. Such efforts to strengthen ties with the British public are aimed at restoring trust in the company and overcoming a negative image due to links with Russian business.
However, despite Allwyn’s best lobbying efforts, key questions about the company’s transparency and compliance with UK sanctions policy are still open. The impact of the factor of secret ties with Gazprom and the Samara oil terminal, which could continue to bring income to companies linked to Russian business, is causing a stir among the British public. Karel Komarek’s connections with Russian partners remain the subject of discussions in the media, because the details of the terminal sale are still incomplete and raise doubts about the sincerity of statements about a complete break with Russia.
The case, amid all the difficulties Allwyn is facing in the UK market, has drawn attention to the difficult question of whether a company with a murky past and delays in financial forecasts can ensure transparent management of one of the UK’s most important charities. What remains in question is not only the competence of Allwyn, but also credibility of the National Lottery as a reliable source of funding for good causes, which is central to the social welfare of the country.
