Massachusetts AG Issues Emergency Regulations Banning Certain Forms of Gambling at Video Terminals

On April 7, the Massachusetts Attorney General issued emergency regulations that effectively ban gambling at Cyber Cafes and at phone card gaming terminals. Certain Cyber Cafes currently feature computer screens on which consumers play a video slot machine or similar game where winning numbers are revealed each time the player uses game credits (or money) to play the game. These establishments claim to sell internet time, coupled with the chance to win prizes through the video slot machine games.  Phone card gaming terminals feature phone card gaming terminals that offer consumers the chance to win a prize by playing games like slots or poker. Consumers must purchase a phone card to play the game, and the consumer redeems his or her winnings in the form of a cash payment. The emergency regulations provide that it is "unfair or deceptive… for any person to engage in a business or engage in a transaction where a gambling purpose predominates over the bona fide sale of bona fide goods or services." These emergency regulations are effective immediately.

 

TIP:  Businesses that offer games that require a purchase of a nominal item in exchange for the opportunity to win cash or other prizes may be deemed illegal in Massachusetts.  However, legitimate consumer promotions intended to promote the sale of a companies goods or services in which the chance to win a prize does not predominate over the sale of goods or services should not be affected by these emergency regulations.