New Internet-based lottery, which is supposed to donate its proceeds to charity, is instead enriching its owners

A charity lottery promoted as the fairer alternative to the National Lottery has awarded its directors shares and bonuses worth almost £10 million (US$18.7 million).

The lottery, called Monday, held its first draw this week and is being heavily advertised as a more altruistic way for people dissatisfied with the national lottery operator, Camelot, to have a weekly flutter.

But scrutiny of financial documents shows that, despite a high-profile publicity and advertising campaign stressing the lottery's benevolent nature, the people behind the scheme are enriching themselves by millions of pounds. Members of the board of Monday's operator Chariot have been granted shares worth £3.4m (US$6.4 million). Share options — which can be exercised immediately regardless of performance — are worth a further £5.2m (US$9.7 million). On top of the shares, share options and their annual salaries the eight executives also stand to pocket a further £1m (US$1.87 million) a year from a company bonus scheme and employee incentive plan.

Leading charities such as Shelter and The Samaritans which signed up to the lottery as partners were not aware of the payments. They were condemned as wrong by Unison, the biggest trade union in Britain, which represents charity workers. But charities said that they welcomed the extra money the scheme could bring in at no extra cost.

In its advertising, Monday promotes itself as a kind of people's lottery with more but smaller prizes than the National Lottery, giving players a 27 times greater chance of winning. Its literature stresses the involvement of high-profile charities such as Barnardo's and St John Ambulance and boasts that it gives more money to charity, 30 percent of total revenue, than Camelot's 28 percent which goes to "good causes".

"Finally, Britain's fairer lottery IS HERE," Monday's advertising trumpeted this week. A footnote to the literature states that the lottery is run by an external manager, Sisson Marketing International. But it makes no mention of the fact that the lottery is ultimately owned by Chariot PLC, a profit-making company floated on the Alternative Investment Market (AIM) in February with £14m (US$26.2 million) of City backing — a detail tucked away on a section of its website. Nor does its advertising reveal that Chariot's running costs and profits of the organization — at 15 percent of revenue — are 50 percent higher than those of Camelot's.

The 70 charities — who stand to receive up to £150m (US$280 million) a year if Monday is successful — will also have to pay back 5 percent of their funds toward running costs in the first year.

Scrutiny by The Independent of financial information provided to investors reveals that Chariot's directors have been handsomely rewarded for their involvement, even though only one of them, John Finan, put any money of their own, around £100,000 (US$187,000), into the venture.

The charity worker who devised the idea of the lottery, Suzanne Counsell, receives the greatest rewards — a 12.8 percent shareholding worth almost £2.5m (US$4.7 million). Tim Holley, the part-time, non-executive chairman, has a slice of the 4.4 million share options granted to the directors.

Mr Holley was chief executive of Camelot when he was criticized by the culture secretary at the time, Chris Smith, for receiving a six-figure bonus in one of the first political rows of the Blair government.

Last night Mr Holley, who works two days a week, defended the payments, saying City investors had wanted to ensure the management had a reason to make the venture a success.