Hey guys, My partner and I are launching a unique raffle site where prizes will be given away. I need a disclaimer formed that is of legal holding. If you have any experience with this please PM me here or email me at Thanks, Brian
You need more than a disclaimer. Running a raffle is illegal in many jurisdictions. Here is a link to the rules in California as an example: http://ag.ca.gov/charities/raffles.php http://ag.ca.gov/charities/statutes/pc320.pdf There are criminal penalties for breaking the law in this regard.
Very good info. I wonder if I can stumble upon which states it is illegal in. Also since we are not actually giving the customers a ticket to hold (it wont be in their possession) wouldnt that loophole the California law? -Brian
I do not think that would be an exception to the law. If you were a judge would it make a difference to you if it was a virtual ticket? It would not because the effect is the same. I believe many states have similar laws to California's regarding raffles. Just google the state's name and the word raffle. Here is New York's law: http://www.oag.state.ny.us/charities/raffles.pdf This is a big deal in most states and the State Attorney General will go after people who are running illegal raffle. Remember, everyone who does not win is disgruntled and can report you. Also, it would be very difficult to run an online raffle and comply with the special rules of each state. Since most require that it is for non-profit purposes, you most certainly will spend far more money just researching the law that you could ever hope to make. I would move along to a new idea. Raffles are fraught with legal rules which really only make them work for bona fide charities.
Actually, although Browntwn is correct about NY, but incorrect about the statute since I assume you're not doing this for a charity. What you're considering is running an illegal lottery or a game of chance. Here's the correct NY statute: dos.state.ny.us/corp/pdfs/mrgoc.pdf You have to register to run games of chance in most states depending on the total value of the prizes being given away. Some states including NY and RI require a bond. It is quite a big pain and a significant outlay of money for the people running the contest. If you want to discuss it state by state, PM me. I used to do these registrations all the time... Deena Burgess, Esq. _____________________________________________________________________________ Any opinions are offered without knowledge of the specific law of your jurisdiction and with only the limited information provided in your post. No advice given here should be reasonably relied upon by you or any third party without consulting an attorney who is aware of all of the facts and law surrounding your situation. Any advice given here is not intended to create an attorney-client relationship in any way.
I am not well versed on NY law, but in California, ONLY charities can do a raffle, so there is no other option. Everything else would be illegal gambling.
Browntwn, Is that new? I'm still finding legal sweepstakes information for California... dca.ca.gov/publications/legal_guides/u-3.shtml See the bottom where it talks about sweepstakes. Or is there something else that I"m missing? Deena Burgess, Esq.
A raffle is not the same as a sweepstakes. So, since he asked about a raffle, that was all I was speaking to. Sweetstakes are legal in California, if done properly. As I understand the distinction, a sweepstakes is free to enter (no purchase necessary - like the McDonald's Monopoly games, etc.) Whereas, a raffle is where people purchase tickets to enter. The main distinction being a raffle is used to raise money and will generate funds, and a sweepstakes offers a prize but brings in no money (although they are often used with the intention to increase people purchasing from the sweepstakes holder - a purchase is not required.) "Raffles in which you must pay money are only lawful if conducted by charitable organizations that are registered with the Attorney General's office to conduct raffles and only if at least 90% of the gross receipts from the raffle are used to benefit or provide support for beneficial or charitable purposes." That quote is from the Attorney General's page on sweepstakes: http://ag.ca.gov/consumers/general/sweepstakes.php
Sorry, nope. Each province in Canada also regulates raffles as does the UK under Lotteries and Amusements Act 1976 (as amended by the National Lottery Act of 1993). You can check for other jurisdictions by googling "raffle law" and the name of the country. Deena Burgess, Esq. ____________________________________________________________________________ Any opinions are offered without knowledge of the specific law of your jurisdiction and with only the limited information provided in your post. No advice given here should be reasonably relied upon by you or any third party without consulting an attorney who is aware of all of the facts and law surrounding your situation. Any advice given here is not intended to create an attorney-client relationship in any way.
I guess I wasted a big budget on this one. $xxxx spent before researching. I guess I can use it as a learning curve.....sigh
Sorry. Look at it this way, had you done it wrong and gotten caught, it could have cost you hundreds of thousands of dollars in fines.... Deena Burgess, Esq.