A LAWMAKER, who chairs a powerful committee in the House of Representatives, has been accused of instigating a smear campaign against a small time lottery (STL) operator in the province of Albay.

Royal Fortune Gaming Corp. (RFGC) alleged that the congressman is behind the malicious attacks against the company after it rescinded its contract with another lottery operator, Best Bingo and Amusement Corp.

RFCG also alleged that Best Bingo is a dummy firm under the control of two lawmakers.

"In the past several weeks our company has been the object of smear campaign questioning the legality of our business and integrity of our STL operations and there can be doubt that this congressman and his cohorts are behind this demolition drive," said RFGC president Johan Cheng in a statement.

The falling out between the two firms reportedly started when RFGC rescinded its share purchase agreement with Best Bingo after the latter allegedly reneged on its obligations to the former.

The agreement provides for the assignment of RFGC's 55-percent equity to Best Bingo in exchange for payment of a certain sum of money. The deal also allowed RFGC to operate the STL in a district and that only Albay residents would be engaged on the ground.

Cheng said that although RFGC complied in good faith with the terms of the deal, Best Bingo did not fulfil its obligations to RFGC.

"Consequently, under the guidance of these congressmen, Best Bingo operated our STL franchise in Albay with hardly any compensation to RFGC. Our efforts to reach the two have all proved futile as they have become scarce to the damage and prejudice of our company," Cheng added.

After efforts failed to amicably settle the dispute, RFGC was forced to rescind its agreement with Best Bingo and terminated the appointments of all ground personnel employed by the latter.

The congressman then resorted to foul tactics in a bid to destroy RFGC's reputation, Cheng said.