Is this legal? <---Please Look

First off, I live in Massachusetts, USA.

I want to create a program that allows gamers to buy points which they use to enter into games where the winner earns...more points. Long story short they can do stuff with those points.

My questions is basically, is that legal? I was wondering if that is considered gambling in any form and if I need the consent of gaming companies to use their game for these matches.

If anyone could let me know whether it is perfectly ok or I will be facing issues / lawsuits, please let me know.

 

I'd suggest you go off shore. You don't have to deal with a bunch of mean corporations and their lawyer here in the US... plus every time local/federal officials hear gaming they are highly likely to treat you like a criminal ....

 

Are you suggesting I leave America? How would I possibly take this off shore....

 

It's your call. Personally I would not do any gambling related business in US. I've done it, had problems and learned the hard way.

You can register an off shore company and use it as "shell" to conduct business online.

I suggest you google what are the big companies doing in this business. Specifically do a research about where are they located/registered (and I assure you all of them are off shore) and what type of payment processors they use... that would give you a clear indication of what are the "best practices" in this industry.

 

Well that's just it. Is it considered gambling?

I talked with support from RivalSpot.com which has people pay money to join and pays the winner direct cash. He said it is because it's all SKILL based, so therefore it is not gambling. He said it was considered Wagering and not gambling.

I would be doing the same except I would not be dealing with real money, but rather points. Gamers buy points so they can join a game where it is skill based to determine who wins. Not luck. So wouldn't that be perfectly ok?

 

I want a gaming matches website, not a search engine / survey site.....

 

No, he's suggesting you take the OPERATION offshore. Like most of the big gaming operations do.

 

Whether your site is a site for gambling or a game of skill can make a difference.

While you live in MA, each state has their own laws about gambling.

These are complicated issues and very fact specific. My suggestion is for you to consult a lawyer and not rely on the short answers given in a forum.

 

I figured that is what it would come to, but I don't think I have the money to consult with a lawyer. Jaffe, do you know if buying points for your account and using those points to join games which have the potential to earn you more based on your skill and if you win is legal?

 

Lawyer is a good idea. Research your state law as well.

 

as long as there is no actual chance/gambling involved, I would say it is not gambling, rather an incentive-based scheme. but I am certainly no expert on US law - as people have recommended, getting a quick advice on this from an online lawyer site might be good.

 

I don't mean to be a party pooper, but if you don't have money to consult with a lawyer, you don't have money to start a business -- so the question is largely academic.

Sweepstakes, raffles, skill games, bingo, cards and sports gambling, lotteries and any and all other forms of "win stuff" propositions are regulated to the throat in the United States. In some cases, you'll have distinct regulations at the federal, state, county and city level. A simple research and assessment request to a law firm will set you back a few hundred bucks max, less than the deposit on your lease, less than you're likely to spend on a decent website design, or a week or so worth of advertising, or even the cash float you'll need to have onhand to keep your bank account solvent with chargebacks and other forms of fraud that are rampant among "point-based" operations.


Frank

 

I'd consult a lawyer. I wouldn't call your venture gambling, but I think you should be safe rather than sorry, so go consult a lawyer if you can.

 

Consult with a lawyer who has knowledge of this kind of law, actually we mere members who cannot give you expert advice.