An Australian security company has won a contract to put invisible “tracers” in ink to verify winning lottery tickets in Mexico.

As part a joint venture, YPB Group (ASX:YPB) will place its tracers in the registers of winning lottery numbers for Mexico’s national lottery office, the Loteria Nacional Para La Assistencia Publica.

“From a science point of view it’s the size of airborne pollution, between two and five nanometers. The technology is best described as a fluorescing technology, but it fluoresces in the invisible light spectrum, so it’s a fully invisible tracer,” executive chairman John Houston told Stockhead.

Most lotteries in South East Asia and Latin America are still paper-based, so print security is a serious issue.

“Mexico runs a lot of lotteries, but they have an analogue ‘buy a ticket from a vendor’ system, like they do in Asia,” Mr Houston said.

“Those tickets, more and more, need anti-counterfeiting technology embedded in them. The contract we announced is for the results. The results are printed on a large A3-size piece of paper and sent to all the various little lottery vendors around the country.”

Mr Houston said the extra security would prevent scams to replace the registers and therefore come up with winning lottery tickets.

“There’s two things you could do, you could make a copy of the winning lottery ticket and hit 20 little vendors at the same time and get a payout. Or equally, if you’re genius enough, you could send a bogus results document around to the vendors and you’d know what was on the bogus document so you could send people in with a winning ticket,” he said.

The contract was awarded to YPB’s joint venture with international security company Affyrmx. The two companies joined forces early in 2016 to provide document protection services in Mexico.

Putting a lid on booze

Not all of YPB’s security solutions are as hi-tech as invisible ink. One of its most recognisable products is the plastic tags that go on the top of bottles at liquor chain Dan Murphy’s.

“We identified that we could use our core fundamentals to create anti-theft tagging,” said Mr Houston.

“So we now are a significant provider of anti-theft tagging to big retail chains in Australia, especially Dan Murphy’s, BWS and also Woolworths.

“In the case of Dan Murphy’s it’s a cap that goes over the top of the higher-value liquors. If you try to run out of the store with it, it will make the little gates go off, but it’s also designed to stop in-store theft where the person takes the top off a high-value whiskey and drinks it in store.

“Our other really interesting product is meat tagging. We’ve found there’s a lot of issues around theft of meat from supermarkets, so we have a product that protects meat against theft. So it will make the alarm go off if someone pinches it.

“With a lot of our anti-theft and -counterfeiting technology, our clients want it in a tag, so we’ve used our tag capability to create these anti-theft tags as well.”

Money troubles

YPB shares have traded between 5c and 25c over the past 12 months, and the company will need to raise funds imminently. It spent $2.05 million in the June quarter, leaving just $557,000 in cash, and expects to spend $2.01 million in the current quarter.

Mr Houston stepped in to assume leadership of the company in early July after the resignation of former CEO Jens Michel, with a goal to reduce overheads by 40 per cent and close existing business leads.

In the fortnight after that change, Mr Houston purchased an additional $15,434 worth of shares in the company through the Bimm Corporation and JF Houston Holdings.


This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.