RHODE ISLAND

I.? Definition of gambling

1. Definition

Rhode Island has deemed lotteries illegal.? R.I. Gen. Laws § 11-19-1 (2002).? A game or scheme must have price, consideration, and chance before it is considered a lottery in Rhode Island.? Roberts v. Communications Inv. Club of Woonsocket, 431 A.2d 1206, 1211 (R.I. 1981).? Rhode Island uses the dominant factor test to determine when the element of chance is present in a game or scheme.? In In Re Advisory Opinion to Governor, 856 A.2d 320, 328 (R.I. 2004), the court stated that the dominant factor test used by a majority of the states has been adopted in Rhode Island.? It stated that a scheme is a lottery when the element of chance dominates, even though there may be some degree of skill or judgment present.? Id.?? The court stated that among the things that it has found to be a lottery are "pyramid schemes" because the success of the venture is predominantly outside the control of the participants.? Id.? The court also mentions many things that will be considered predominantly chance-based including roulette, craps, slot machines, poker, blackjack, dice games, and games that involve the spinning of a wheel.? Id. at 328-29.

Free Entry

Although the court in State v. Big Chief Corp., 13 A.2d 236, 239 (R.I. 1940), seems to agree with the principle that a game should not be considered a lottery when no one has paid for the chance to be involved in the random distribution of prizes, it was less certain about a "bank night" run by a grocery store.? This game run by the supermarket required eligible individuals to register in person at the grocery store or receive the registration cards from the super market's solicitors and then register it at the supermarket itself.? Id. at 238.? Registered individuals then had to come to the grocery store parking lot on the designated night and wait for the announcement for the winner of the cash prize.? Id.? No purchase of the store's merchandise was required to enter.? Id.? While the court recognized that some courts have held consideration is present in these schemes if there is consideration sufficient to execute a contract, the court in this case stated that consideration in this context meant giving something of pecuniary value.? Id. at 239. Even though the court admitted that the bank night scheme was designed primarily to increase attendance at the supermarket during the night when the scheme was conducted, as well as all other nights, the court was not persuaded that anyone had bought the store's merchandise for the purpose of entering this drawing or that anyone had even come to the store in their desire to enter the contest.? Id. at 242.

It seems that the difference between this case and cases from other jurisdictions involving "bank nights" run by theatres, is that with the theatres, those that bought a ticket were able to be close to the actual announcement of the winner and could easily walk up and collect the prize, as compared to those that didn't buy a ticket for admission that were forced to wait outside.? However, in this contest, everyone was forced to wait in the same position (outside in the parking lot), so those that bought merchandise from the store and then received a registration card would have no discernable advantage over those that did not buy merchandise.

II.? Definition of Bookmaking

R.I. Gen. Laws § 11-19-14 (2002) provides that:

Except as provided in chapter 4 of title 41, any person who shall engage in pool selling or bookmaking, or shall occupy or keep any room, shed, tenement, tent, or building, or any part of them, or shall occupy any place upon any public or private grounds within this state, with books, apparatus, or paraphernalia for the purpose of recording or registering bets or wagers or of buying or selling pools, or who shall record or register bets or wagers or sell pools upon the result of any trial or contest of skill, speed or power of endurance of man or beast, or upon the result of any political nomination, appointment, or election, or, being the owner or lessee or occupant of any room, tent, tenement, shed, booth, or building, or part of them, knowingly shall permit it to be used or occupied for any of these purposes, or shall keep, exhibit or employ any device or apparatus for the purpose of recording or registering bets or wagers, or the selling of pools, or shall become the custodian or depositary for gain, hire, or reward of any money, property, or thing of value staked, wagered, or pledged or to be wagered or pledged upon the result, or who shall receive, register, record, forward, or purport or pretend to forward to or for any race course, or person, within or outside this state, any money, thing, or consideration of value bet or wagered, or money, thing, or consideration of value offered for the purpose of being bet or wagered upon the speed or endurance of any man or beast; or who shall occupy any place or building or part of it with books, papers, apparatus, or paraphernalia for the purpose of receiving or pretending to receive, or for recording or registering, or for forwarding or pretending or attempting to forward in any manner whatsoever, any money, thing, or consideration of value bet or wagered or to be bet or wagered for any other person, or who shall receive or offer to receive any money, thing, or consideration of value bet or to be bet at any race track within or without this state, or who shall aid, assist or abet in any manner in any of the acts forbidden by this section, shall upon conviction be punished by a fine not exceeding five hundred dollars ($500) or imprisonment not exceeding one year, and upon a second conviction of a violation of this section shall be imprisoned for a period not less than one nor more than five (5) years.

III.? Gambling devices

R.I. Gen Laws § 11-19-18 (2002) punishes those that keep a keep a gambling device.? It punishes those that keep cards, dice, table, bowls, wheel of fortune, shuffleboard, or billiard table, or any device, implement, or apparatuses whatsoever to used in gambling or playing at games of chance.

Other things that have held to be a gambling device by Rhode Island Courts include a slot machine.? State v. Busch, 195 A. 487, 488 (R.I. 1937).

IV.? Bucket Shops

The definition of Bucket shops found in R.I. Gen. Laws § 6-17-1 (2001) includes:

(i) The making of or offering to make any contract respecting the purchase or sale, either upon credit or upon margin, of any securities or commodities, in which both parties to the contract intend, or the keeper intends, that the contract shall be, or may be, terminated, closed, or settled according to or upon the basis of the public market quotations of prices made on any board of trade or exchange upon which the securities or commodities are dealt in, and without a bona fide purchase or sale of the securities or commodities;

(ii) The making of or offering to make any contract respecting the purchase or sale, either upon credit or upon margin, of any securities or commodities in which both parties intend, or the keeper intends, that the contract shall be or may be deemed terminated, closed, or settled when the public market quotations of prices for the securities or commodities named in the contract shall reach a certain figure without a bona fide purchase or sale of the securities or commodities; or

(iii) The making of or offering to make any contract respecting the purchase or sale, either upon credit or upon margin, of any securities or commodities in which both parties do not intend, or the keeper does not intend, the actual or bona fide receipt or delivery of the securities or commodities, but do intend, or the keeper does intend, a settlement of the contract based upon the differences in the public market quotations of prices at which the securities or commodities are, or are asserted to be, bought and sold.

V.? Express Prohibitions on games of skill

1.? Poker

In Re Advisory Opinion to Governor, 856 A.2d 320, 328 (R.I. 2004), the court agreed with other jurisdictions and held that even though poker and other card games like blackjack do involve a high degree of skill, and players can become more proficient at these games through practice, the random distribution of the cards, or the deal, is the dominant element and makes these games of chance.? The court held that the deal of the cards determined the outcome of the games, not the player's skill, and hence theses games should be considered chance-based.

R.I. Gen. Laws § 11-19-18 (2002) also prohibits using cards that would be used in gambling or playing games of chance for money or other valuable consideration.? Because it seems that most, if not all, card games involving the random deal of cards would be labeled games of chance under the above court's definition, this provision becomes a very broad prohibition if these games are played for money or other valuable consideration.

2.? Dice games

In Re Advisory Opinion to Governor, 856 A.2d 320, 329 (R.I. 2004), the court held that like card games, games that involve the roll of dice are considered to be games of chance, or lotteries.? The actual roll of the dice is considered to be a chance-based activity, outweighing the degree of skill that could be exercised by the players in the game.? Id.?

R.I. Gen. Laws § 11-19-18 (2002) also prohibits the use of dice in gambling or any other games of chance when money or other valuable consideration is at stake.? Because the above court seems to think that any game involving the roll of dice will be a game of chance, this is a very broad prohibition on dice games played for money or other valuable consideration.

3.? Billiards

R.I. Gen. Laws § 11-19-18 (2002) prohibits keeping a billiard table for any gambling purpose or for a game of chance.

Because Rhode Island uses the dominant factor test, it seems that billiards could not be construed as a game of chance.? Therefore, it seems that this statute is aimed at those that provide a billiard table upon where other games of chance other than the actual game of billiards is played.? Although dealing with another topic, the case of State v. Contildes, 401 A.2d 426, 427-28 (R.I. 1979), talks about a pool tournament that was run by a bar every week.? Therefore, it seems that holding a billiard or pool tournament is legal because the game is one of skill.

4. Bowling

Besides the normal license requirements for having and operating a bowling alley, Rhode Island does not have any statutes or case law that deal with bowling and gambling.

However, because Rhode Island uses the dominant factor test, and bowling is widely considered to be a game where skill is the prevalent factor, it seems that bowling tournaments would be allowed in Rhode Island.

5.? Darts

There is no mention of darts in Rhode Island statutes and case law.? However, because Rhode Island uses the dominant factor test it can be assumed that having a darts tournament would be legal because it seems that darts is a game of skill, not chance.

VI.? Express Exemptions

1.? Social Gambling Exception

Senior citizen housing organizations can conduct, within their own facilities, a bingo game with total daily prizes totaling four hundred dollars or less.? R.I. Gen. Laws § 11-19-32.1 (2002).? These games can be conducted for recreational purposes only and are available only to senior citizens that are a resident of the senior housing project where the game is being held.? R.I. Gen. Laws § 11-19-32.1 (2002).? These organizations can only run three bingo games per calendar week.? R.I. Gen. Laws § 11-19-32.1 (2002).

These senior citizens organization can also conduct, within their own housing project, a raffle where the total prize does not exceed five hundred dollars.? R.I. Gen. Laws § 11-19-34.1 (2002).? These raffles can only be held for recreational purposes and can be played only by residents of the housing project.? R.I. Gen. Laws § 11-19-34.1 (2002).? These raffles can only be held three times during any one-year.? R.I. Gen. Laws § 11-19-34.1 (2002).

Also, any "state, city, town, ward, or district committee elected pursuant to the provisions of title 17 or certified candidates but not both, as defined in title 17, shall be allowed to conduct that lottery commonly known as a twenty (20) week club' or conduct a raffle once within a twelve (12) month period subsequent to notification to the Rhode Island lottery commission."? R.I. Gen. Laws § 11-19-1.1 (2002).

Also, a club can distribute door prizes at one of its entertainment outings provided that they obtain written permission from the town sergeant, the police commission, or the chief of police, whichever is available.? R.I. Gen. Laws § 11-19-13 (2002).

2.? Charitable gaming

A charitable organization is defined in Rhode Island as, "any benevolent, educational, philanthropic, humane, patriotic, social service, civic, fraternal, police, labor, religious, eleemosynary person, and/or persons holding themselves out to be a charitable organization."? R.I. Gen. Laws § 11-19-30(a) (2002).? To conduct permitted games of chance, the organization must file a registration statement with the division of state police.? R.I. Gen. Laws § 11-19-31 (2002).

Approved organizations can operate bingo games.? R.I. Gen. Laws § 11-19-32 (2002 & Supp. 2005).? However, this is subject to many qualifications and limitations such as,

1) ?the game can be conducted only by members of the organization.? R.I. Gen. Laws § 11-19-32(1) (2002 & Supp. 2005).?
2)? the entire net proceeds of the game are applied solely to the charitable purposes of the organization.? R.I. Gen. Laws § 11-19-32(3) (2002 & Supp. 2005).
3)? the total prizes in one night cannot exceed six thousand fifty dollars.? R.I. Gen. Laws § 11-19-32(5) (2002 & Supp. 2005).
4)? these games are limited to two nights per calendar week.? R.I. Gen. Laws § 11-19- 32(6) (2002 & Supp. 2005).
5)? Only one "winner-take-all" game can be played per night.? R.I. Gen. Laws § 11-19-32(11) (2002 & Supp. 2005).?
6)? the game may allow for a prize pool which starts at five hundred dollars and increases by one hundred dollars each week until it reaches one thousand dollars.? R.I. Gen. Laws § 11-19-32(14) (2002 & Supp. 2005).
Charitable organizations can also receive and then sell pull-tab lottery tickets.? R.I. Gen. Laws § 11-19-35 (2002).

Any organization that wants to run other games of chance substantially like bingo, or a raffle, lottery, or a lottery known as a "twenty week club," can do so provided that they obtain a license from the division of state police as detailed in R.I. Gen. Laws § 11-19-37 (2002).? R.I. Gen. Laws § 11-19-36 (2002).? Bingo and other games of chance licenses come with an application fee of five dollars.? R.I. Gen. Laws § 11-19-37 (2002).

3.? Chucky Cheese Exemption

Rhode Island law provides no express exemption dealing with family entertainment centers or for redemption slot machines that issue something that is exchangeable for a small piece of merchandise.

4.? Commercial Gaming/ Slots

Commercial casino gambling is available in Rhode Island.? R.I. Gen. Laws § 41-9.1-8 (Supp. 2005).? However, before these facilities can be established in a town or city, the voters of that area must be given the chance to approve or reject this addition.? R.I. Gen. Laws § 41-9-4(a) (1997 & Supp. 2005).? This proposal should also be submitted by the secretary of state to the qualified voters of the state.? R.I. Gen. Laws § 41-9-4(c) (Supp. 2005).??

These casinos are authorized to conduct gaming within their facilities.? Gaming means to "deal, operate, carry on, conduct, maintain, or expose or offer for play any gambling game or gaming operation."? R.I. Gen. Laws § 41-9.1-3(19) (Supp. 2005).? A gambling game in Rhode Island is defined as:

any game played with cards, dice, equipment or a machine, including any mechanical, electromechanical or electronic device which shall include computers and cashless wagering systems, for money, credit, or any representative of value; including, but not limited to faro, monte, roulette, keno, bingo fan tan, twenty-one, blackjack, seven and a half, klondike, craps, poker, chuck a luck, Chinese chuck a luck (dai shu), wheel of fortune, chemin de fer, baccarat, pai gow, beat the banker, panguingui, slot machine, any banking or percentage game, or any other game or device approved by the Commission, but does not include games played with cards in private homes or residences in which no person makes money for operating the game.

R.I. Gen. Laws § 41-9.1-3(17)? (Supp. 2005).? R.I. Gen. Laws § 41-9.1-3(18) (Supp. 2005) goes on to define a "game" as "any banking or percentage game located exclusively within a licensed casino which is played with cards, dice, or any electronic, electrical, or mechanical device or machine for money, property, or any thing of value."

Besides the listed allowed games, it is obvious through the broad definition of a gambling game that slot machines are allowed (electronic devices for money, credit, or any representative of value).

R.I. Gen. Laws § 41-9.1-22 (Supp. 2005) & R.I. Gen. Laws § 41-9.1-23 (Supp. 2005) provide the standards for licensing an applicant to operate a casino.? These standards include:

(a) No applicant shall be eligible to obtain a license to conduct gaming operations, a permit or registration unless the Commission (i) has, with respect to a casino license applicant, received a filing made under oath that includes without limitation the information set forth below, and (ii) is satisfied that the applicant is suitable. In determining whether a casino license applicant is suitable, the Commission may consider, in addition to the information set forth below, whether the applicant has been found suitable and/or has been issued a license to conduct casino gaming in other jurisdictions.

(1) The identity of every person in accordance with the provisions of this subdivision, who has or controls any ownership interest in the applicant with respect to which the license is sought. If the disclosed entity is a trust, the application shall disclose the names, addresses, birth dates and social security number of all such beneficiaries, if a corporation, the names, addresses, birth dates, and social security numbers of all such officers and directors; if a partnership, the names, addresses, birth dates, and social security numbers of all such partners, both general and limited, if a limited liability company, the names, addresses, birth dates, and social security numbers of all such members. The applicant shall also separately disclose in like manner any person or entity directly or indirectly owning or controlling a five percent (5%) or greater voting interest in such owners of the applicant. If any such person is an entity with one or more classes of securities registered pursuant to the securities exchange act of 1934, as amended, the applicant shall disclose names, addresses, birth dates and social security numbers of all officers and directors and provide public filings with the U.S. Securities and Exchange Commission for the past year. If any such persons or entities are institutional investors or institutional lenders owning or controlling a five percent (5%) or greater voting interest in such owners of the applicant, the applicant shall not be required to provide detailed information on such institutional investors or institutional lenders other than their respective identities unless otherwise requested by the commission. The applicant will forward any request for additional information to the institutional investors or institutional lenders.
(2) An identification of any business, including, if applicable the state of incorporation or registration, in which an applicant or any other person or entity identified in subdivision (a)(1) above has an equity interest of five percent (5%) or more. If an applicant is a corporation, partnership, or other business entity, the applicant shall identify any other corporation, partnership, or other business entity in which it has an equity interest of five percent (5%) or more; including, if applicable, the state of incorporation or registration. An applicant can comply with this subdivision by filing a copy of the applicant's registration with the securities exchange board if the registration contains the information required by this subsection.
(3) Whether an applicant or any other person or entity identified in subdivision (a)(1) above is known by applicant to have been indicted, charged, arrested, convicted, pleaded guilty or nolo contendere, forfeited bail concerning, or has had expunged any criminal offense under the laws of any jurisdiction, either felony or misdemeanor, not including traffic violations, regardless of whether the offense has been expunged, pardoned or reversed on appeal or otherwise, including the date, the name and location of the court, arresting agency and prosecuting agency, the case caption, the docket number, the offense, the disposition, and the location and length of incarceration.
(4) Whether an applicant or any other person or entity identified in subdivision (a)(1) above is known by applicant to have ever applied for or has been granted any gaming license or certificate issued by a licensing authority within this state or any other jurisdiction that has been denied, restricted, suspended, revoked, or not renewed, and a statement describing the facts and circumstances concerning the application, denial restriction, suspension, revocation or nonrenewal, including the licensing authority, the date each action was taken, and the reason for each action.
(5) Such information, documentation and assurances as may be required to establish by clear and convincing evidence:
a. the financial stability, integrity and responsibility of the applicant, including but not limited to bank references, financial statements, tax returns and other reports filed with governmental agencies;
b. the adequacy of financial resources both as to the completion of the casino proposal and the operation of the casino; and
c. that the applicant has sufficient business ability and casino experience as to establish the likelihood of creation and maintenance of a successful, efficient and competitive casino operation.
(6) Such information, documentation and assurances to establish to the satisfaction of the Commission the applicant's good character, honesty and integrity, and the applicant's suitability qualification pursuant to this section.
(7) A statement listing the names and titles of all Rhode Island public officials or officers of any unit of government, and the spouses, parents, and children of those public officials or officers who, directly or indirectly, own any financial interest in, have any beneficial interest in, are the creditors of or hold any debt instrument issued by, or hold or have any interest in any contractual or service relationship with an applicant. As used in this subsection, the terms "public official" and "officer" do not include a person who would have to be listed solely because of his or her state or federal military service. This subsection shall not apply to public officials or officers or the spouses, parents and children thereof, whose sole financial interest amounts to less than a one percent (1%) ownership interest in a publicly traded company.
(8) The name and business telephone number of any attorney, counsel, lobbyist, agent, or any other person representing an applicant in matters before the Commission.
(9) Whether an applicant or any other person or entity identified in subdivision (a)(1) above has ever filed or had filed against it a civil or administrative action or proceeding in bankruptcy or has ever been involved in any formal process to adjust, defer, suspend, or otherwise work out the payment of any debt including the date of filing, the name and location of the court, the case caption, the docket number, and the disposition.
(10) Whether an applicant or any other person or entity identified in subdivision (a)(1) above has filed, or been served with, a complaint or other notice filed with any public body, regarding the delinquency in the payment of, or a dispute over the filings concerning the payment of any tax required under federal, state, or local law, including the amount, type of tax, the taxing agency, and the periods involved.
(11) Financial and other information in the manner and form prescribed by the commission.

(b) For purposes of this chapter, "suitable" means that the proposed casino licensee, or other applicant or permittee has demonstrated to the Commission by clear and convincing evidence that he or she:

(1) Is a person of good character, honesty, and integrity or an entity whose reputation indicates it possesses honesty, integrity and sufficient knowledge of the gaming industry.
(2) Is a person whose prior activities, criminal record, if any, reputation, habits, and associations do not pose a threat to the public interest of this state or to the effective regulation and control of gaming, or create or enhance the dangers of unsuitable, unfair, or illegal practices, methods, and activities in the conduct of gaming or the carrying on of the business and financial arrangements incidental thereto.
(3) Is capable of and likely to conduct the activities for which the applicant or casino gaming operator is licensed or approved in accordance with the provisions of this chapter and any rules of the Commission.

(c) For purposes of a casino licensee, the applicant shall also demonstrate by clear and convincing evidence that:

(1) He/she or the entity has adequate business competence and experience in the operation of gaming operations.
(2) The proposed financing of the conducting of gaming operations is:
(a) Adequate for the nature of the proposed operation; and
(b) From a suitable source, subject to provisions of § 41-9.1-23 hereof.

(d) Information provided by the applicant shall be used as a basis for a thorough background investigation that the Commission shall conduct. A false or incomplete filing may be cause for denial of a license. The Commission in its sole discretion may provide the applicant a reasonable opportunity to correct any deficiency in the filing.

(e) Applicants shall consent in writing to being subject to the inspections, searches, and seizures provided for in this chapter and to disclosure to the Commission and its agents of otherwise confidential records including tax records held by any federal, state, or local agency, or credit bureau or financial institution while applying for or holding a license under this chapter.

(f) The Commission may contract for, at the expense of the applicants, any technical or investigative services that it shall require to conduct such research and/or investigation, as it deems appropriate with respect to its evaluation of the filing. A nonrefundable application fee of fifty thousand dollars ($50,000) shall be paid at the time of filing to defray the costs associated with such research and investigation conducted by the Commission. If the costs of the research and investigation exceed fifty thousand dollars ($50,000), the applicant shall pay the additional amount.

(g) All licensees, all permittees, and any other persons who have been found suitable or approved by the Commission shall maintain suitability throughout the term of the license, permit or approval. In the event of a current prosecution of an offense, the Commission shall have the discretion to defer a determination on a person's continuing suitability pending the outcome of the proceedings, provided that if a decision is deferred pending such outcome, the Commission, where applicable, may take such action as is necessary to protect the public trust, including the suspension of any license, permit or registration.

(h) All holders of licenses, permits and registrations, and any other persons required to be found suitable, shall have a continuing duty to inform the Commission of any possible violation of this chapter and of any rules adopted by the Commission. No person who so informs the Commission or any law enforcement authority within the state of a violation or possible violation shall be discriminated against by the applicant, licensee, permittee, registrant or casino gaming operator because of supplying such information, and shall be afforded the protection of § 28-50-1 et al. "The Rhode Island Whistleblower's Protection Act", so called.

(i) The Commission shall have the power to call forward for a finding of suitability any person that is affiliated with a licensee, permittee or registrant if necessary to protect the public interest. Subject to § 41- 9.1-24, any person who has or controls directly or indirectly five percent (5%) or greater voting interest shall meet all suitability requirements and qualifications pursuant to the provisions of this chapter, unless otherwise determined by the Commission.


(j) If the Commission finds that an individual owner or holder of a security of a licensee, permittee, or registrant, or of a holding or intermediary company of a licensee or permittee, or registrant, or any person or persons with an economic interest in a licensee, permittee, or registrant, or a director, partner, officer, or managerial employee is not suitable, and if as a result, the licensee, permittee, or registrant is no longer qualified to continue as a licensee, permittee, or registrant, the Commission shall propose action necessary to protect the public interest, including the suspension of the license, permit or registration. The Commission may also issue under penalty of revocation or suspension of a license, permit, or registration, impose a condition of disqualification naming the person or persons and declaring that such person or persons may not:

(1) Receive dividends or interest on securities of a person, or a holding or intermediary company of a person, holding a license, permit, or other approval.
(2) Exercise directly, or through a trustee or nominee, a right conferred by securities of a person, or a holding or intermediary company of a person, holding a license, permit, or other approval of the Commission issued pursuant to the provisions of this chapter.
(3) Receive remuneration or other economic benefit from any person, or a holding or intermediary company of a person, holding a license, permit, or other approval issued pursuant to this chapter.
(4) Exercise significant influence over activities of a person, or a holding or intermediary company of a person, holding a license, permit, or other approval issued pursuant to the provisions of this chapter.
(5) Continue owning or holding a security of a person, or a holding or intermediary company of a person, holding a license, permit, or other approval of the Commission issued pursuant to the provisions of this chapter or remain as a manager, officer, director, or partner of a licensee or permittee.

R.I. Gen. Laws § 41-9.1-22 (Supp. 2005).? R.I. Gen. Laws § 41-9.1-23 (Supp. 2005) provides criteria that will disqualify an applicant, and this list includes:

1) Failure of the applicant to prove by clear and convincing evidence that he/she is suitable in accordance with the provisions of this chapter.
(2) Failure of the applicant to provide information and documentation to reveal any fact material to a suitability determination, or the supplying of information which is untrue or misleading as to a material fact pertaining to the qualification criteria.
(3) The conviction of, or a plea of guilty or nolo contendere by, the applicant, or of any person required to be qualified under this chapter for an offense punishable by imprisonment of more than one year or a fine up to one thousand dollars ($1,000); provided however, a conviction or plea of guilty or nolo contendere by the applicant shall not constitute an automatic disqualification as otherwise required if:
(a) Ten (10) or more years has elapsed between the date of application and the successful completion of service of any sentence, deferred adjudication, or period of probation or parole; or
(b) Five (5) or more years has elapsed between the date of application and the successful completion of any sentence, deferred adjudication, or period of probation or parole and the conviction for an offense which was a misdemeanor offense.
(4) Notwithstanding any provision of law to the contrary, the Commission may consider the seriousness and circumstances of any offense, any arrest, or any conviction in determining suitability.

5.? Lottery

Rhode Island has a state lottery commission that is responsible for overseeing the state-sponsored lottery.?? R.I. Gen. Laws § 42-61-1(a) (1998 & Supp. 2004).? This commission is also responsible for determining the types of lotteries to be conducted, the price of tickets, the awards given out, the frequency of drawings, etc.? R.I. Gen. Laws § 42-61-2 (1998 & Supp. 2004).

The commission is also in charge of licensing ticket sales agents.? R.I. Gen. Laws § 42-61-5(b) (1998).? However, no person can sell lottery tickets as their sole occupation or business.? R.I. Gen. Laws § 42-61-5(b) (1998).

Rhode Island also offers lottery games played on video lottery terminals.? R.I. Gen. Laws § 42-61.2-2(a) (1998).? These terminals can only be located at dog racing and jai-alai facilities that are licensed to conduct pari-mutuel wagering as of June 30, 1992.? R.I. Gen. Laws § 42-61.2-2(b) (1998).? These machines can award free games or credits redeemable for cash, but not money directly from the machine.? R.I. Gen. Laws § 42-61.2-1(7) (1998).? These games can be played even when the facility where they are located is not conducting a pari-mutuel event.? R.I. Gen. Laws § 42-61.2-6 (1998).? ?

6.?? Pari-Mutuel betting

a.? Horse

Rhode Island has a racing and athletics hearing division and board that oversee the horseracing, dog racing, and jai-alai activity in the state.? R.I. Gen. Laws § 41-2-1 (1997).? This board is in charge of providing the licenses required to conduct this kind of racing in the state.? R.I. Gen. Laws § 41-3-1 (1997).

There are different licenses required depending on the type of horseracing that will be held.? This list includes:

(1) Class A. Horse running races, so-called.
(2) Class B. Competitive harness horse races which are run in connection with the grand circuit, so-called.
(3) Class C. Competitive harness horse races that are not run in connection with the grand circuit, so-called.
(4) Class D. Competitive horse races where there is no wagering.
(5) Class E. Harness racing by any incorporated association duly authorized to maintain agricultural exhibits.

R.I. Gen. Laws § 41-3-3 (1997).

At these racing events, pari-mutuel betting is allowed.? R.I. Gen. Laws § 41-4-1(a) (1997) & R.I. Gen. Laws § 41-4-2 (1997).?? In fact, events run under a class A license can only be conducted using this system, while events run under a B, C, and E license can be conducted under the pari-mutuel system or auction mutuel system.? R.I. Gen. Laws § 41-4-1(b-c) (1997).?

b.? Dog

Dog racing in Rhode Island can only be held in the towns of Burrillville, Lincoln, and West Greenwich.? R.I. Gen. Laws § 41-3.1-1 (1997).? However, the tracks there must still be licensed by the racing and athletics board.? R.I. Gen. Laws § 41-3.1-3 (1997).? While the board may fix the dates when the racing can occur, a track must be granted at least one hundred twenty five days racing days per year.? R.I. Gen. Laws § 41-3.1-4(2) (1997).

The facilities that conduct the racing are allowed to use the pari-mutuel system.? R.I. Gen. Laws § 41-3.1-5 (1997).

c.? Jai-Alai

The town of Newport is allowed to conduct jai alai games, provided that the jai-alai facility is licensed by the racing and athletics board.? R.I. Gen. Laws § 41-7-3 (1997 & Supp. 2005).?? Pari-mutuel betting can take place in the enclosure of the facility when jai-alai is being played.? R.I. Gen. Laws § 41-7-5 (1997).

d.? Off-track locations

The division of racing and athletics can issue a license to conduct off track betting, provided that the city where this establishment is located has approved it at a general election.? R.I. Gen. Laws § 41-10-1 (1997).? These facilities must be a full service betting facility meaning it must offer food and drink services, be at least ten thousand square feet, and provide audio/visual signals of horse racing programs via approved telecommunications and totalizator systems.? R.I. Gen. Laws § 41-10-3 (1997).

Also, dog racing and jai-alai facilities can enter into a contract with a licensed racing association to simulcast programs from the facility on certain days if they obtain a permit from the division of racing and athletics.? R.I. Gen. Laws § 41-11-2 (1997).? However, these simulcasts can be broadcast on a maximum of two hundred seventy days in a calendar year, and the licensee can only accept pari-mutuel wagering on the simulcast at the licensed facility.? R.I. Gen. Laws § 41-11-2(b)&(d) (1997).

VII. Internet Prohibition

There is no statute governing Internet gambling in Rhode Island

VIII.? Penalties

a.? gambling/gaming/games of chance

Forms of gambling prohibited

Any person that directly or indirectly puts on a lottery or game of chance for the purpose of giving up something of value is guilty of a felony.? R.I. Gen. Laws § 11-19-1 (2002).? The punishment for violation of this section is a fine up to two thousand dollars or a prison term up to two years long.? R.I. Gen. Laws § 11-19-1 (2002).? The language used in this section seems to only apply to the operators of these games.

Acts in aid of policy game

Whoever acts in aid of a policy game can be fined up to five hundred dollars or imprisoned for up to one year.? R.I. Gen. Laws § 11-19-5 (2002).? If convicted a second time for violation of this section, the person can be imprisoned anywhere from one to five years.? R.I. Gen. Laws § 11-19-5 (2002).? This statute seems to apply to those that actually help with the actual operation of the policy game, as well as some individuals that may just merely play the game.? For example, this statute stretches to individuals that knowingly possess a ticket that was used to promote, carry on, or play the game of policy-lottery.? State v. Gaines, 79 A. 1107, 1108 (R.I. 1911).? It is not unreasonable to believe that someone as detached from the scheme as a player could be found to knowingly possess one of these policy tickets.?

Illegal trading stamps and coupons/Distribution of illegal stamps and coupons/Stamps and coupons as inducement to purchase goods.

Anyone who distributes illegal trading stamps, or those that distribute illegal stamps as an inducement to purchase goods, are guilty of a misdemeanor.? R.I. Gen. Laws § 11-19-12 (2002).? Illegal stamps are defined as stamps that entitle a purchaser of goods to receive "directly from the vendor or indirectly through any other person or corporation, some indefinite and undescribed article, the nature and value of which are unknown to the purchaser of the goods, wares, and merchandise at the time of the purchase of the merchandise . . . ."?? R.I. Gen. Laws § 11-19-9 (2002).? These individuals can be fined between one hundred and five hundred dollars or can be sent to prison for up to three months.? R.I. Gen. Laws § 11-19-12 (2002).? This provision seemingly only applies to those that distribute those stamps, not those that just receive them.

Bookmaking

Anyone who is engaged in bookmaking or pool-selling, or who owns a structure that is used for recording or registering bets upon the result of any trial or contest of skill, speed, power, or endurance of man or beast, or a political nomination, appointment or election, can be fined up to five hundred dollars or be imprisoned for up to one year.? R.I. Gen. Laws § 11-19-14 (2002).??? Upon the second conviction, the person can be imprisoned for up to five years.? R.I. Gen. Laws § 11-19-14 (2002).? This provision extends to only those that are actually involved in the operation of bookmaking, not those that buy pools or place bets with the bookmaker.?? This bookmaking prohibition in Rhode Island also extends to those that engage in bookmaking while on the premises of a racetrack or fronton facility.? R.I. Gen. Laws § 11-19-14.1(a) (2002).? Individuals found guilty of this could be fined up to one thousand dollars or be imprisoned for up to five years.? R.I. Gen. Laws § 11-19-14.1(a) (2002).??? Also, anyone that has ever been convicted of bookmaking in Rhode Island cannot even enter a racetrack or fronton facility.? R.I. Gen. Laws § 11-19-14.1(b) (2002).? A person found guilty of this can be fined up to five hundred dollars and be sent to prison for up to one year.? R.I. Gen. Laws § 11-19-14.1(b) (2002).

Keeping of gambling places or devices-Acting as dealer, banker, or lookout

Anyone person that keeps a structure in Rhode Island that is used for gambling purposes, or keeps under his control gambling devices, or who deals, or acts as the lookout, gamekeeper, assistant for the game of Faro or any other banking game, can be fined between five hundred and five thousand dollars and can be imprisoned for up to two years.? R.I. Gen. Laws § 11-19-18 (2002).?? This statute only applies to those that keep the place or device, and does not apply to those that use the place or device for gaming purposes only.

Furthermore, those that knowingly permit their place to be used by another as a gambling house or place can be fined up to five hundred dollars.? R.I. Gen. Laws § 11-19-22 (2002).

Inducing others to visit gambling place

Any person who tries to invite or entice any other person to visit a place that is kept for gambling purposes with the intent that the other person engage in some form of gambling for money or other valuable consideration while there, can be fined up to five hundred dollars or sent to prison for up to one year.? R.I. Gen. Laws § 11-19-20 (2002).?? This statute seemingly applies only to those that do the enticing, not those that are actually enticed.

Frequenting gambling place

Any person that frequents a house or place where gambling is being conducted can be imprisoned up to thirty days.? R.I. Gen. Laws § 11-19-21 (2002).? This statute applies to just the players that visit these places solely for gaming purposes.? There is an exception for those in the performance of their official duty and those that are the landlord of the place there for legitimate purposes.? R.I. Gen. Laws § 11-19-21 (2002).

b. State Lottery Crimes

Sales above fixed price-Unlicensed sales-Gifts

Any licensed person who sells a state lottery ticket at a price higher than that fixed by the commission, or anyone that sells lottery tickets unlicensed, is guilty of a misdemeanor.? R.I. Gen. Laws § 42-61-8 (1998).? However, this section doesn't prohibit individuals from giving lottery tickets to another as a gift.?? R.I. Gen. Laws § 42-61-9 (1998).

Sales to minors-Gifts

Any person that knowingly sells a state lottery ticket to any person under the age of eighteen is guilty of a misdemeanor.? R.I. Gen. Laws § 42-61-9 (1998).? However, this section doesn't prohibit an individual from giving a minor a ticket as a gift.? R.I. Gen. Laws § 42-61-9 (1998).

Penalties for forgery and counterfeiting

Anyone that falsely makes or forges a lottery ticket with intent to defraud is guilty of a felony and can be fined up to one thousand dollars and can be sentenced to a prison term of up to ten years.? R.I. Gen. Laws § 42-61-16 (1998).

Exclusion of minors from video lottery terminals

No person under eighteen can play one of these lottery video games and no licensed video lottery retailer can knowingly permit a minor to play one of these games.? R.I. Gen. Laws § 42-61.2-5 (1998).

Penalty for manipulation or tampering

Anyone that has intent to manipulate the operation of a video lottery terminal is guilty of a felony and can be fined at least ten thousand dollars and can be imprisoned for up to ten years.? R.I. Gen. Laws § 42-61.2-8 (1998).

c. Horseracing, Dog Racing, Jai-Alai crimes

Penalty for unauthorized horseracing

Any person that aids or abets in the conducting an unlicensed horse race for a reward is guilty of a misdemeanor and can be fined up to five hundred dollars for each day of unauthorized racing and can be imprisoned for up to six months.

IX. Statute of Anne/ Recovery of Debts

R.I. Gen. Laws § 11-19-17 (2002) states that all instruments or promises won at any game or by betting at any race or fight, or for the repayment of money knowingly lent for such gaming or betting is void.?

Interpreting this statute, the court in McGrath v. Kennedy, 2 A.438 (R.I. 1886), held that those that deposit a bet with a stakeholder where the stakeholder is charged with the task of giving the winner of the bet the money, can recover from the stakeholder that money if he asks for the money back from the stakeholder before it is paid over to the winner.? This seems to indicate that recovery of gambling debt is allowed through the actual winner as well as a stakeholder involved in the transaction.

R.I. Gen. Laws § 11-19-4 (2002) also allows any person who buys a lottery ticket from someone not authorized to sell them by the Rhode Island state police to recover the amount paid by them for the ticket.

X.? Commercial Gaming

The Rhode Island lottery commission is also in charge of licensing, regulating, and enforcing the casino gaming in the state.? R.I. Gen. Laws § 41-9.1-4 (Supp. 2005).? There is a master gaming contract that exists among the Narragansett Indian Tribe, Harrah's Entertainment, Inc., and the Lottery Commission in Rhode Island.? R.I. Gen. Laws § 41-9.1-3(34) (Supp. 2005).

1.? Games permitted

Licensed casinos are authorized to conduct gaming within their facilities.? Gaming means to "deal, operate, carry on, conduct, maintain, or expose or offer for play any gambling game or gaming operation."? R.I. Gen. Laws § 41-9.1-3(19) (Supp. 2005).? A gambling game in Rhode Island is defined as:

any game played with cards, dice, equipment or a machine, including any mechanical, electromechanical or electronic device which shall include computers and cashless wagering systems, for money, credit, or any representative of value; including, but not limited to faro, monte, roulette, keno, bingo fan tan, twenty-one, blackjack, seven and a half, klondike, craps, poker, chuck a luck, Chinese chuck a luck (dai shu), wheel of fortune, chemin de fer, baccarat, pai gow, beat the banker, panguingui, slot machine, any banking or percentage game, or any other game or device approved by the Commission, but does not include games played with cards in private homes or residences in which no person makes money for operating the game.

R.I. Gen. Laws § 41-9.1-3(17)? (Supp. 2005).? R.I. Gen. Laws § 41-9.1-3(18) (Supp. 2005) goes on to define a game as "any banking or percentage game located exclusively within a licensed casino which is played with cards, dice, or any electronic, electrical, or mechanical device or machine for money, property, or any thing of value."

Besides the above listed permitted games, it is obvious through the broad definition of a gambling game that slot machines are allowed (electronic devices for money, credit, or any representative of value).

2.? Limits

Rhode Island statutory law offers no guidance on the limits of bet size, payouts, loss limits, etc., except for saying that the Rhode Island State Lottery Commission has the power to make rules and regulations affecting the operation of the Casino.? R.I. Gen. Laws § 41-9.1-3(17)? (Supp. 2005).

3.? Taxes and Fees

?Fees

An initial casino license is valid for five years and is renewable for five years upon the payment of a five hundred thousand dollar fee and continued compliance with all the casino regulations.?? R.I. Gen. Laws § 41-9.1-11 (Supp. 2005).

There is a casino license fee in the amount of one hundred million dollars payable in three equal installments on the date of the issuance of the license, the one-year anniversary of the issuance of the license, and the two-anniversary of the issuance of the license.? R.I. Gen. Laws § 41-9.1-12 (Supp. 2005).

Also, the casino licensee must show the Lottery Commission that it has invested a total of at least five hundred thousand dollars for the purpose of acquiring interests in land, making improvements, and developing property to be used in constructing the casino and related structures.? R.I. Gen. Laws § 41-9.1-12(e) (Supp. 2005).

Fifty thousand dollars a year must be paid by each casino every year for the marketing of state convention and tourism business.? R.I. Gen. Laws § 41-9.1-12(f) (Supp. 2005).? Each casino licensee is also required to provide one hundred fifty thousand dollars a year to the Rhode Island Council on Problem Gaming or other department that the council designates.? R.I. Gen. Laws § 41-9.1-12(g) (Supp. 2005).

The casinos must also guarantee that that the aggregate amount of the video lottery terminal revenue and wagering tax revenue, minus certain amounts refunded to GTECH Corporation under the master contract between GTECH Corporation and the Commission effective July 1, 2003, received by the state in each of the two years following the opening of the casino must at least equal 110% of the video lottery terminal revenue received by the state the year before the casino is opened.? R.I. Gen. Laws § 41-9.1-12(c) (Supp. 2005).? If that figure is not met, the casino must reimburse the state the difference of the shortage.? R.I. Gen. Laws § 41-9.1-12(c) (Supp. 2005).

Taxes

R.I. Gen. Laws § 41-9.1-12 (Supp. 2005) also provides for a wagering tax.? It provides that:

The annual rate of taxation on the adjusted gross receipts ("AGR") received by the casino licensee from gaming authorized under this chapter shall be as follows for the period of time commencing on the first (1st) day on which the casino opens for business (the "Commencement Date") and expiring at the end of five (5) years from the Commencement Date (the "Expiration Date").

AGR up to an including $400 million 25.00%
AGR greater than $400 million and up to and including $500 million 27.00%
AGR greater than $500 million and up to and including $600 million 29.00%
AGR greater than $600 million and up to and including $750 million 31.00%
AGR greater than $750 million and up to and including $900 million 33.00%
AGR greater than $900 million and up to and including $1 billion 35.00%
AGR greater than $1 billion 40.00%

The annual rate of taxation on AGR received by the casino licensee from gaming authorized under this chapter shall be as follows subsequent to the Expiration Date and going forward:
AGR up to and including $400 million 25.00%
AGR greater than $400 million and up to and including $500 million 28.00%
AGR greater than $500 million and up to and including $600 million 30.00%
AGR greater than $600 million and up to and including $750 million 32.00%
AGR greater than $750 million and up to and including $900 million 35.00%
AGR greater than $900 million 40.00%

R.I. Gen. Laws § 41-9.1-12(b) (Supp. 2005)

For every hotel room that is occupied by a guest, the casino licensee must pay the state a one dollar hotel occupancy tax.? R.I. Gen. Laws § 41-9.1-12(d) (Supp. 2005).

Operational requirements, hours, advertising, entertainment, exclusion, gambling age, mandatory exclusions, discretionary exclusions, voluntary exclusions by problem gamblers

Operational requirements

As stated earlier, the Rhode Island state lottery commission has the authority to issue regulations regarding the operation and management of the casinos in the state.? R.I. Gen. Laws § 41-9.1-14 (Supp. 2005).

The commission requires that anyone wishing to supply, sell, lease, or repair casino gaming equipment, devices, or supplies must obtain a permit.? R.I. Gen. Laws § 41-9.1-15 (Supp. 2005).? The issuance of such a permit is solely with the discretion of the Commission.? R.I. Gen. Laws § 41-9.1-15(c) (Supp. 2005).? These permits are effective for a period of five years; however, the Commission has the authority to issue temporary permits.? R.I. Gen. Laws § 41-9.1-15(f) (Supp. 2005).? The fee for such a permit is three thousand dollars and the renewal fee is one thousand dollars.? R.I. Gen. Laws § 41-9.1-16(d) (Supp. 2005).

The commission also requires those that wish to supply, sell, lease, or repair non-gaming devices or supplies in a casino to obtain a permit if the business transacted with the casino exceeds a total amount of two hundred thousand dollars per calendar year.? R.I. Gen. Laws § 41-9.1-17(a) (Supp. 2005).? These permits are initially one hundred dollars, the same price as the renewal fee for such a permit.? R.I. Gen. Laws § 41-9.1-17(b) (Supp. 2005).

Also, those that are considered key gaming employees (defined in R.I. Gen. Laws § 41-9.1-3(28) (Supp. 2005) as "any natural person employed in the operation of a licensed casino facility in a supervisory managerial capacity or empowered to make discretionary decisions which regulated casino facility operations, as determined by the Commission), must obtain a permit from the Commission.? The initial application fee is two hundred dollars, with a renewal fee of one hundred dollars.? R.I. Gen. Laws § 41-9.1-18(d) (Supp. 2005).

Hours

Although exact hours of operation are listed, the casino is forced to post local curfews within the casino itself.? R.I. Gen. Laws § 41-9.1-25(10) (Supp. 2005).

Advertising

If a casino does any adverting to the public in print, the casino must provide the toll-free number for the National Council on Problem Gambling or a similar commission in the state approved by the Commission.? R.I. Gen. Laws § 41-9.1-27 (Supp. 2005).

Also, casinos cannot send advertisements to those on the self-exclusion list within 90 days after receiving notice of inclusion on the list.? R.I. Gen. Laws § 41-9.1-25(b)(7) (Supp. 2005).

Entertainment

R.I. Gen. Laws § 41-9.1-41(d) (Supp. 2005) mentions that casinos may be able to run a bar or restaurant within the casino.? However, these areas must be nonsmoking unless the bar is located in a designated smoking area within the gaming area.? R.I. Gen. Laws § 41-9.1-41(d) (Supp. 2005).

Exclusion

According to R.I. Gen. Laws § 41-9.1-28 (Supp. 2005), a casino may exclude any person for any reason, except for their race, color, creed, national origin, sex, or disability.? A casino is not liable for monetary damages or any other remedy in a judicial proceeding for the exclusion unless the exclusion is done on the basis of race, color, creed, national origin, sex, or disability.? R.I. Gen. Laws § 41-9.1-28 (Supp. 2005).

Gambling age

R.I. Gen. Laws § 41-9.1-36(c)(1) (Supp. 2005) states that an individual is guilty of a misdemeanor if they are under twenty-one years of age and knowingly make a wager within the casino.

Mandatory exclusions

The Commission is authorized to make a list prohibiting certain individuals from entering any room, premises, or designated gaming area where legal casino gambling is being conducted.? R.I. Gen. Laws § 41-9.1-26(a) (Supp. 2005).? This list includes the following persons:

1) Those who are career or professional offenders as defined by the rules of the Commission.
(2) Those who have been convicted of a criminal offense specified by the Commission.
(3) Those whose presence in a gaming establishment operated by a casino licensee would be adverse to the interests of Rhode Island or gaming operations.

(b) The Commission shall have the authority to place persons on the excluded list. The Commission may not place a person on such a list due to the person's race, color, creed, national origin, sex, or disability.

R.I. Gen. Laws § 41-9.1-26(a) (Supp. 2005).

Voluntary exclusions by problem gamblers

According to R.I. Gen. Laws § 41-9.1-25(c)(1) (Supp. 2005), any person, especially those with a compulsive gambling problem, can request that the Lottery Commission put their name on a list of self-excluded persons.? These individuals can later be removed from the list provided that they get approval from Commission in a private hearing.? R.I. Gen. Laws § 41-9.1-25(c)(2) (Supp. 2005).

Gaming contracts

There is no mention of gaming contracts in the Rhode Island Gaming Control and Revenue Act.

Casino Crimes

Use of device to obtain advantage at casino game

If a person playing a casino game uses a device, or assist another in using the device, that is designed for gaining and advantage at playing the game, the device may have to be forfeited.? R.I. Gen. Laws § 41-9.1-30 (Supp. 2005).? Additionally, that person may be fined up to one thousand dollars and can be imprisoned for up to one year.? R.I. Gen. Laws § 41-9.1-30 (Supp. 2005).

Unlawful use of bogus chips, or gaming billets, marked cards, dice, cheating devices, unlawful coins

Anyone at a casino that knowingly use or possess a gambling cheating device like bogus chips, marked cards, loaded dice, or an unauthorized entry key to a slot machine, can be imprisoned for up to five years and can also be fined up to ten thousand dollars.? R.I. Gen. Laws § 41-9.1-31 (Supp. 2005).

Skimming of gaming proceeds

Anyone who skims gaming proceeds under one thousand dollars (defined in R.I. Gen. Laws § 41-9.1-33 (Supp. 2005) as the intentional excluding or the taking of any action in an attempt to exclude any thing or its value from the deposit, counting, collection, or computation of either gross revenues from gaming operations or activities, net gaming proceeds, or amounts due to the state), may be imprisoned for up to five years or may be fined up to five thousand dollars.? R.I. Gen. Laws § 41-9.1-33 (Supp. 2005).

A casino making false statements relating to gaming

Anyone that makes a false material statement when applying for a license, permit, development agreement, or any other document required by this act can be fined up to ten thousand dollars and can be imprisoned for up to five years.? R.I. Gen. Laws § 41-9.1-29?? (Supp. 2005).

Entry of casino by person on designated excluded list

Those that enter a casino while on the list of persons to be excluded or ejected can be imprisoned for up to six months and can be fined up to five hundred dollars.? R.I. Gen. Laws § 41-9.1-26(e) (Supp. 2005).