By Rich Miller, Exec. Dir.
Gaming Industry Association The rapid evolution from checks to credit and debit cards continues to receive the attention of Gambling Control.
You recall new rules were adopted in November more clearly defining "credit gambling" as it relates to the cards. As Gambling Control continues to report on the issue at each Gaming Advisory Council meeting, it might be a good time to review the regulations ourselves.
You can find the relevant statute at 23-5-157 and the key rule at 23.16.202. Make sure you are using a current version of the rules as they have recently been amended--the latest version is from Jan. 2006. Both can be found on the internet at
for the statute and at for the rule.
At the heart of the division' concern is this portion of the statute, "A check or credit card may be used to obtain cash to participate in a gambling activity," and how it is being applied, particularly to credit and debit cards.
The practical application is that about the only place to obtain cash with a credit or debit card is at an ATM or bank. If your agreement with your card processing company is like most other businesses, you are only allowed to charge for merchandise--and cash isn't merchandise.
This means if a patron is running a bar/food tab and asks you to add some cash to the tab, you cannot do so. It is against the rules of the card company and therefore would be uncollectible should the customer protest the charge.
Then, if cash is obtained this way and used for gambling, it is against the law and, depending on the amount, could constitute a felony. On top of the felony Montana law specifically prohibits collection of gambling debts incurred on credit cards.
Even the use of "gift certificates" is something you should discuss with your card merchant and receive written confirmation that those transactions are permissible. Then, to be on the safe side, never redeem a "gift certificate" for cash.
A patron may continue to use a check to obtain cash under certain guidelines. A check must be delivered and accepted unconditionally. It cannot be post dated and you must include it in your next deposit unless it is purchased, with cash, before noon the next day.
It really isn't all that complicated, and it is wise for all of us to conservatively construe and apply the law and rules, for our own sake as well as for the entire
industry.
Source: The Montana Tavern Times, July, 2006, published monthly by Continental Communications, 125 W. Granite St., Suite 102, Butte, MT 59701.