What is not a bet?
- A contract to insure, indemnify, guarantee or otherwise compensate another for a harm or loss sustained, even though the loss depends upon chance.
- A contract for the purchase or sale at a future date of securities or other commodities.
- Offers of purses, prizes or premiums to the actual contestants in any bona fide contest for the determination of skill, speed, strength, endurance or quality, or to the bona fide owners of animals or other property entered in such a contest.
- The game of bingo when conducted in compliance with sections 349.11 to 349.23.
- A private social bet not part of or incidental to organized, commercialized or systematic gambling.
- The operation of equipment or the conduct of a raffle under sections 349.11 to 349.22, by an organization licensed by the gambling control board or an organization exempt from licensing under section 349.166.
- Pari-mutuel betting on horse racing when the betting is conducted under chapter 240.
- The purchase and sale of state lottery tickets under chapter 349A.
Private, Social Bets
It is sometimes difficult to distinguish the difference between a "private, social bet" and illegal gambling. The best way to make the distinction is to look at the intention of the law.
Minnesota law makes any "bet" illegal. A "bet" is defined as "a bargain whereby the parties mutually agree to a gain or loss by one to the other of specified money, property or benefit dependent upon chance, although the chance is accompanied by some element of skill." According to this definition, any card game where the participants pay to play, and have a chance to win money, would constitute a "bet" and, therefore, be illegal gambling.
However, the criminal gambling statute creates an exception for "a private, social bet." The important thing to remember about a private social bet is that it cannot be part of "organized, commercialized or systematic gambling." The owner of the location of the social bet cannot derive any profit from the bet, organize regular occasions for such bets, or advertise their occurrence. Potentially, any gambling that occurs in a business establishment could constitute illegal gambling because the owner of the establishment derives the indirect benefit of increased patronage.
It appears that the law was intended to exclude from prosecution such events as penny-ante card games among friends in one's home, small spontaneous wagers between friends, and other spur-of-the-moment private transactions. Once those wagers occur on a regular basis at a business establishment, it is difficult to characterize them as "social bets," and the location of the event runs a substantial risk of violating the law.
What is not a lottery?
An in-package chance promotion is not a lottery if all of the following are met:
- Participation is available, free and without purchase of the package, from the retailer or by mail or toll-free telephone request to the sponsor for entry or for a game piece;
- The label of the promotional package and any related advertising clearly states any method of participation and the scheduled termination date of the promotion;
- The sponsor on request provides a retailer with a supply of entry forms or game pieces adequate to permit free participation in the promotion by the retailer's customers;
- The sponsor does not misrepresent a participant's chances of winning any prize;
- The sponsor randomly distributes all game pieces and maintains records of random distribution for at least one year after the termination date of the promotion;
- All prizes are randomly awarded if game pieces are not used in the promotion; and
- The sponsor provides on request of a state agency a record of the names and addresses of all winners of prizes valued at $100 or more, if the request is made within one year after the termination date of the promotion.
Except as provided by section 349.40, acts in this state in furtherance of a lottery conducted outside of this state are included notwithstanding its validity where conducted.
The distribution of property, or other reward or benefit by an employer to persons selected by chance from among participants who have made a contribution through a payroll or pension deduction campaign to a registered combined charitable organization, within the meaning of section 309.501, as a precondition to the chance of being selected, is not a lottery if:
- All of the persons eligible to be selected are employed by or retirees of the employer;
- The cost of the property or other reward or benefit distributed and all costs associated with the distribution are borne by the employer; and
- The total amount actually expended by the employer to obtain the property or other rewards or benefits distributed by the employer during the calendar year does not exceed $500.
Casino Nights (for charitable organizations)
What is a casino night?
Many people looks for ways to raise money for good causes. One popular way is a "casino night" where participants usually pay to play. Games in a casino night typically involve chips or play money, which players win through various forms of gambling, such as blackjack, dice tables or roulette wheels. Winners redeem chips or play moneyh for things of values, such as appliances or trips.
Are casino nights lawful?
The State Attorney General's Office concludes that most casino night activities are generally considered illegal gambling. Illegal types of gambling include activities where participants pay to play for the chance of winning something of value in games such as blackjack, dice, roulette or poker. The possession or use of gambling devices used in these activities, such as roulette wheels and slot machines, is illegal.
What about games of skill?
If the activity is a game of skill, then criminal penalties do not apply. Skill activities might include darts, bowling and pool tournaments. However, "casino nights" do not usually include activities based on the outcome of a player's skill, but rather the luck of the draw or some other chance event.
What kind of gambling activities are legal in Minnesota?
Allowable gambling activities in Minnesota are licensed charitable gambling, including pulltabs, paddlewheels, tipboards, bingo and raffles. The Minnesota Lottery, pari-mutuel betting on horse races, and tribal gaming are also permitted.
The Gambling Control Board licenses lawful gambling activities and should be consulted with any questions or concerns. Qualifying organizations must be licensed by the Gambling Control Board prior to the gambling being conducted.
Chance Drawings and Raffles
What is a raffle?
A raffle is defined as a game in which a participant buys a ticket for a chance at a prize with the winner determined by a random drawing to take place at a location and date printed on the ticket.
Who is eligible to conduct a raffle?
Under Minnesota Statues, section 349.12, organizations eligible to conduct a raffle are veteran, fraternal, religious and other nonprofit organizations. If you are a qualified organization, a permit may be obtained from the Gambling Control Board at (651) 639-4000.
What is a lottery?
A lottery is a plan which provides for the distribution of money, property or other reward or benefit to persons selected by chance from among participants some or all of whom have given a consideration for the chance of being selected.
How can I conduct a chance drawing without violating the law?
The Minnesota Supreme Court and state statute allow chance drawings which do not require consideration if:
- the participant is not required to purchase a ticket for drawing in order to win a prize
- the participant must be allowed to enter drawing without any consideration for a chance to win a prize.
A drawing organizer may not imply that a participant must pay a donation for the chance to win a prize (for example, "Suggested Donation, $5") or may not coerce a participant to pay a donation for the chance to win a prize. If the organizer implies or coerces the participant in any manner, there is a substantial risk of violating law.
Must I keep records?
The Alcohol and Gambling Enforcement Division strongly suggests that those conducting a chance drawing maintain records of:
- number of participants
- prizes awarded
- number of prizes awarded.
Card Games at Business Establishments
Minnesota law makes any "bet" illegal. A "bet" is defined as "a bargain whereby the parties mutually agree to gain or loss by one to the other of specified money, property or benefit dependent upon chance, although the chance is accompanied by some element of skill." According to this definition, any card game where the participants pay to play, and have a chance to win money, would constitute a "bet" and therefore, be illegal gambling.
However, the criminal gambling statute creates an exception for "a private, social bet." The important thing to remember about a private social bet is that it cannot be part of "organized, commercialized or systematic gambling." The owner of the location of the social bet cannot derive any profit from the bet, organize regular occasions for such bets or advertise their occurrence. Potentially, any gambling that occurs in a business establishment could constitute illegal gambling because the owner of the establishment derives the indirect benefit of increased patronage.
It appears that the law was intended to exclude from prosecution such events as penny-ante card games among friends one's home, small spontaneous wagers between friends and other spur-of-the-moment private transactions. Once those wagers occur on a regular basis at a business establishment, it is difficult to characterize them as "social bets" and the location of the event runs a substantial risk of violating the law.
Allowable Card Games
Additionally, Minnesota law allows for social skill card games of cribbage, skat, sheephead, bridge, euchre, pinochle, gin, 500, smear or whist, and Texas Hold'em, so long as the tournament or contest does not provide any direct financial benefit to the promoter or organizer.
More on Texas Hold'em
Players in Texas Hold'em tournaments cannot be charged any fee or be required to give any consideration (something of value) as a condition of participation. In other words, players must be able to participate in a Texas Hold'em tournament for free. Prizes can be awarded in Texas Hold'em tournaments. However, as in the case with tournaments involving other social skill games, the value of all prizes awarded in a single tournament cannot exceed $200.
With respect to Texas Hold'em, the law further specifies that the value of all prizes awarded to an individual winner of a tournament at a single location may not exceed $200 per day. To participate in Texas Hold'em tournament or contest, a player must be at least 18 years old.
Minnesota law requires the organizer or promoter of any Texas Hold'em tournament to ensure that reasonable accommodations are made for players with disabilities. In addition to making other accommodations to tournament tables and cards, a tournament organizer or promoter has to make sure that Braille cards are available for blind players and that the cards visible to the entire table are announced.
Dice in Liquor Establishments
Social dices games are permitted on the premises and adjoing rooms of a licensed establishment to sell alcoholic beverages. Only the following games are allowed, and restrictions apply to these games as noted.
- Who Buys
- Last Chance
- Liar's Poker
- Wager or prizes for the abov e games are only for food or beverages
- The licensed retail alcoholic beverage establishment does not organize or participate financially in the games.
- Any prize or wger, limmited to food or beverages, that is involved is the respsonsiblity of the patron/playerr, not the establishment.
All other forms of dice games are illegal, and not allowed in licensed alcholic beverage establishments.
Tipboard and Tipboard Tickets
Tipboards and tipboard tickets are popular forms of legal, charitable gambling in Minnesota. Illegal tipboards and tipboard tickets are also popular, especially during football season.
Legal gambling revenue contributes to the state’s general fund, as well as many city and county budgets. Programs benefitting from legal charitable gambling include:
- Youth and school activities
- Military members and veterans
- Fraternal/civic clubs
- Fire departments/associations
- Persons in need
- Wildlife management
According to the Minnesota Gambling Control Board, one factor in declining receipts of charitable gambling is illegal sports boards.
What is a tipboard?
Tipboard means a board, placard or other device containing a seal that conceals the winning number or symbol, and that serves as the fame flare for a tipboard game (Minn. Statute 349.12
Tipboards may also include any board, placard or other device marked off in a grid or columns, in which each section contains a hidden number or numbers, or other symbol, which determines the winning chances (Minn. Statute 349.2127
What is a tipboard ticket?
A legal tipboard ticket is a folded or banded single ticket that typically conceals one number or set of symbols. Illegal tipboard tickets typically conceal a set of two numbers which are used to represent the scores of the sports game being bet on.
How to tell if a tipboard or tip ticket is legal?
View legal and illegal tipboard
Sales and distribution of tipboards or tipboard tickets is only legal if the organization or individual is licensed by the Minnesota Gambling Control Board, or is exempt or excluded from licensing.
The Minnesota state seal and a bar code will be printed on the main tipboard or game flare
- Only sold by state-licensed non-profit organizations
- Legal tipboards are never used for sporting events
- Legal tipboards are never taken or sold off-premise.
What is the penalty for selling illegal tipboards or tipboard tickets?
The unauthorized sale or possession of gambling equipment, depending on the quantity of tip tickets or boards, is a gross misdemeanor or felony, the latter punishable with a maximum of five years and/or a $10,000 fine.
What's the difference between an essay contest and an illegal lottery?
Write a winning essay, and win a car, vacation, or even an entire hotel. Many Minnesotans have seen and entered these essay contests, hoping to take the grand prize with their skills. But before you conduct or participate in an essay contest, make sure you know the difference between a contest and a crime.
Minnesota law makes it a crime to conduct a lottery. A lottery is defined as a "plan which provides for the distribution of money, property or other reward or benefit to persons selected by chance from among participants, some or all of whom have given consideration [money or other valuables] for the chance of being selected." The key word here is chance.
MInnesota law also makes it a crime to bet except in limited situations. The law says a bet is defined as "a bargain whereby the parties mutually agree to a gain or loss by one to the other of specified money, property or benefit dependent upon chance, although the chance is accompanied by some element of skill." Although an essay contest may involve some element of skill, the judging is largely subjective. What is considered creative by one person may be considered dull by the next.
In a section of the law entitled "what are not bets," is this description: "offers of purses, prizes or premiums to the actual contestants in any bona fide contest for the determination of skill, speed, strength, endurance, or quality or to the bona fide owners of animals or other property entered in such a contest."
The Gambling Enforcement Division believes that many essay contests meet the statutory definition of a "bet," and that the winners of such contests are selected by chance. The division would caution a person conducting or entering an essay contest that there is a likelihood that the contest could be an illegal lottery.
What are the requirements for licensing gambling-related business?
Minnesota, like most jurisdictions, requires a license for those who want to operate gambling-related business. These licenses are issued primarily for the manufacture or distribution of gambling equipment and devices. Licenses for gambling equipment are issued by the Gambling Control Board and those for gambling devices are issued by the Gambling Enforcement Division.
What is gambling equipment?
Gambling equipment generally includes items such as pull-tabs, bingo equipment, paddlewheel equipment, tipboards and pull-tab dispensing devices.
What is a gambling device?
A gambling device affords players an opportunity to obtain something of value (other than free plays) automatically which is done principally by chance. The most common types of devices in Minnesota are slot machines and video poker machines.
Are applicants automatically granted a license?
No. Gambling-related activities are among the most heavily regulated businesses in the world. Applicants are screened through a comprehensive background investigation. This investigation involves examination of the applicant's personal, business, and financial relationships and associations. The investigation ensures that the applicant meets the requirements for a license, and ensures public safety and integrity in the industry, as required by state law.
Who conducts the investigation?
Special Agents for the Gambling Enforcement Division conduct the license applicant investigations in Minnesota.
How long does it take to complete the process?
Each application is different and it is difficult to provide a specific time frame. A multi-national corporation will take far longer to complete than a sole proprietor who has lived his or her entire life in Minnesota.
How much do licenses cost?
License fees are set by the Legislature, and therefore are subject to change. By contacting the appropriate division, you can determine the current fee.
The license applicant is charged for the cost of the license background investigation. At the time of the application, the applicant places funds on deposit to begin the investigation. Additional funds may be collected later if the cost of the investigation exceeds the deposit amount. In the event the cost of the investigation is less, the balance will be refunded to the applicant.