I will pay you $25 for the best answer to my question

what are the issues with creating a raffle site? i would like to understand what problems i might encounter if i create a website whereby i raffle off prizes to users who want to buy raffle tickets and a chance to win.

specifically, i'm looking for guidance around how raffles work and any legal issues i might encounter. is a raffle the same as a lottery or gambling?

thank you! i love yahoo answers!!! :)

oh, after i receive enough answers, i will choose one that i consider the best. ask me a question if you like for further clarity. i will pay the best answerer via paypal immediately.

Dear I Love Answers:

Assuming you're in the US. Yes, raffles are considered gambling. Having said that, it depends on the state you're operating from. Each state has it's own guidelines that need to be followed plus the federal guidelines. There may even be postal implications. If you are serious about this, I would strongly recommend that you get some legal advice. While it may be pricey, it'll certainly be a lot less than going to jail or paying hefty fines.

Best of Luck!

Anne

There is a lot of stuff going around about the legality of raffles so I'd really do my research.

This is from a Dog Club's Website.

Internet Raffles and the BMDCA

During the BMDCA Board meeting at the Wisconsin Specialty, we examined the issue of internet raffles directly involving the BMDCA (i.e., sponsored by the BMDCA, organized by the BMDCA, funds collected by the BDMCA) being used for fundraising efforts. Some members did extensive research on this issue, and provided the board with the following information:

There is a variety of laws and opinions regarding internet raffles. Most of the information leads to the conclusion that it is unlawful to hold a raffle on the internet. Investigation has shown that:

1. Each state has its own Raffle laws. States where raffles are legal have their own separate rules and regulations for holding raffles. In states where raffles are legal some type of raffle license must be obtained from the pertinent state office.

2. Raffles are considered a form of gambling. Gambling is carefully monitored by state and federal regulations. The three basic criteria that satisfy the definition of gambling are: (1) a prize is awarded; (2) the winner of the prize is determined purely by chance; and (3) some consideration or payment is required to participate.

3. Although each state has its own raffle rules, if the BMDCA were to hold an internet raffle we would be crossing interstate lines. For instance, in the state of Oklahoma, raffles are illegal. We cannot research and obtain a raffle license in each state. It would be impractical and non-cost effective.

We have contacted state raffle offices, the US Justice Department and researched the Internet. Although we have not found a written law saying specifically "no internet raffles," we have got enough information to conclude that it is illegal.

In light of the above information and after extensive discussion, the BMDCA Board of Directors has adopted a policy that the BMDCA shall not directly participate in Internet raffles.

This, of course, only applies to internet raffles that directly involve the BMDCA. There are a number of other fundraising/raffle efforts being conducted online (such as BEHAF and BLEF) to benefit various BMD causes, but these raffles and their host organizations or individuals are not affiliated in any way with the BMDCA; thus, this action by the BMDCA does not affect them.

Also,

Here is a link regarding it in Indiana, specifically. Obviously, it could be different in some places, but you can get some good ideas/impressions/things to consider from here:
http://www.indiana.edu/~sls/raffle.html#so

This article is called "Charitable Raffles, Know the Law" and may benefit you as well.
http://www.oag.state.tx.us/newspubs/weeklyag/2004/0604raffles.pdf#search='raffles%2C%20legality

If you need some more information contact me via e-mail and I'll see what I can dig up for you. Best of luck with it.

Streak

Yes many issues. In order to legally run a site you must be certified as a licensed gaming establishment by the secretary of your state, and you must be certified as the game manager, much paperwork and fees. Also any prizes you give away you must own and all raffle money must be kept in bank account that state can monitor. Sounds like a big cluster f*** to me but good luck. If you want exact rules write your secretary of state. streak_tlu sucks

A lottery, illegal in all fifty states (except when run by the government) has the elements of chance, prize and consideration. To run a "raffle" and avoid the lottery law you must eliminate one of the elements. Prize promotions accomplish this by eliminating the element of chance by having a skill contest (e.g. in 25 words or less etc) OR ELIMINATING THE ELEMENT OF CONSIDERATION (enter on a 3x5 card). Only other method is to establish a non-profit (501-3-C) charity. Contact me for more information. Jeff
sperryny@yahoo.com

Well first you need a website.
Then a solid knowlegde of MySQL Database (or money to hire someone to make one for you)
And finally you will also need a professional subscribers and e-mail automated system.

With these 3 elements you will basically have an automated system that gather people information and store them in your website database.

Believe it or not that is the easy part.

Now you need to make money out of it. Unless you are planning to make people pay to be part of some sort of lotto, but that ain't gonna happen and that's not even a raffle. So let's not go there.

The best way is to join affiliates programs. These marketing program pay you to send them leads and have the subscribers of your raffle website fill up free online aplications. These programs can bring you somewhere around $1000 / month if you know what you are doing.
That's where you will get your funds that will help you pay for whatever gift or cash you want to give to a few random picked subscribers of your raffle.

And now for the great finale, unless you have some way to get thousands of people e-mails you are in for a lot of financial pain.

Why?

because you will need to advertize your raffles website and make it "interesting"

The most efficient way to advertize online is using Yahoo and Google keywords marketing (adwords and stuff like that) and trust me when I tell you this does not come cheap.

There are also many other ways to advertise, do some research on online marketing.

As for the legal part, it pretty easy actually.

You need to register your home bussiness as a DBA in order to be able to collect and distribute funds online. It takes a couple days to do so and its cost is minimal.

You will also need to set up a legal document available for everyone before they register, stating about your terms and conditions of using your services and being eligible for a raffle.
Not doing this will make you very very very sorry in these lawsuit happy-trigger days.

There you go, now you have a general idea on what are you in for, hope it helped

I'll keep it short and simple - There must be an element of skill involved, or you'll be holding an illegal lottery...which you don't want to do!

Security is going to be an issue - can people fix the raffle etc?

That said, as long as you find a great developer and online marketing agency you can let them worry about the details...

If you select my answer to win, please donate the $25 to a legitimate, worthwhile charity instead.

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