TxtDrv became TxtWalk - and judge rules it illegal

Two men have been found guilty of running an illegal lottery after 26 people did not get the cars they thought they had won in a competition.

Auckland District Court judge Nicola Mathers yesterday found Richard Stuart Hayes and Troy Jonathon Elliot guilty on one charge each of organising an illegal lottery. Her ruling, in a reserved decision, followed a hearing in February.

Hayes and Elliot, as directors of the Watch and Win company, organised the TxtDrive competition in March 2004.

Mobile phone users were asked in television advertisements on TV2 to text at a cost of 99c a word of the day to become eligible to win a Peugeot car on each of the 27 days the competition was run.

But the competition did not generate the money expected, and the organisers received $414,595 instead of the forecast $2.5 million.

Text responses were less than forecast and there was not enough money to pay for the cars.

Settlements were reached with the prize winners, although only one received a car.

"I am satisfied that the Department of Internal Affairs has proved to me beyond reasonable doubt that Mr Hayes and Mr Elliot organised an illegal lottery," Judge Mathers said.

"I consider they deliberately entered into the scheme and were careless as to the legality of this novel scheme."

The men, whose names were suppressed until yesterday, claimed the competition was a sales promotion and not a lottery.

But Judge Mathers said she was satisfied it was not a sales promotion, and was therefore an illegal lottery.

The maximum penalty is a fine of $4000 or three months' imprisonment.

Hayes and Elliot are to be sentenced on October 6.

- NZPA