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SEC to Investigate Brazil Corruption Issues

29 July 2004

WEST GREENWICH, Rhode Island – (PRESS RELEASE) -- GTECH Holdings Corporation (NYSE: GTK) today provided an update on recent developments in Brazil. The Company announced that it has received notice from the United States Securities and Exchange Commission (SEC) that it has approved a formal order of investigation in the preexisting matters the SEC staff has been examining related to media reports about public corruption issues in Brazil. The Company has been advised by the SEC staff that the new order is unrelated to any recent or new developments in the matter and is routine and intended to give it adequate investigatory powers should it desire to employ them. The SEC has also sent the Company a subpoena for the production of certain documents and records related to GTECH's operations in Brazil that is identical to the previously-disclosed informal request for documents from the SEC.

The Company has been cooperating fully with all SEC information requests which require the review of a substantial volume of documents, many in Portuguese, from its Brazilian operations. The SEC has expressed its satisfaction with GTECH's cooperation in this matter.

An internal review conducted by management and under the supervision of the independent directors of the GTECH Board of Directors is continuing. From what has been learned from that investigation to date, the Company is confident that it acted appropriately and GTECH's compliance program worked as it is intended.

In other related developments, GTECH has been formally served with the civil complaint filed by the Public Ministry in relation to its contracts with Caixa Economica Federal (Caixa). The Company will now be afforded the opportunity to review the evidence developed by the public ministry attorneys. The Company reiterated that it has good and adequate defenses to the claims made in the lawsuit, will vigorously defend itself in the proceedings, and expects a positive outcome.

This lawsuit seeks to impose damages equal to (i) the sum of all amounts paid to GTECH under the 1997 contract and the 2000 contract which has been estimated to be $650 million to date; (ii) certain other permitted amounts; (iii) minus our proven investment costs; and (iv) potential penalties. GTECH believes that the services were provided under valid and enforceable contracts and as such does not anticipate material liabilities to result from this claim.

As part of that civil action, the Company also filed an appeal to the injunctive order that placed the restrictions on the transfer or sale of the Company's Brazilian assets and placed 30 percent of the regular revenues from its contract with Caixa under court control. The court is expected to take up that appeal when it returns from its current recess.

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