Current through 2024-38, September 18, 2024
An applicant for a license to act as a fantasy contest
operator shall apply on forms specified by the director. In addition to the
information required by
8 M.R.S.
sections1103 -
1104, an
applicant must provide the following information:
1. The physical address of the applicant's
principal place of business and the designated contact person for the applicant
including a telephone number, address and email address for that
contact.
2. Disclosure of ownership
interests. A disclosure of the true ownership interests of the fantasy contest
operator as follows:
A. The names, addresses,
phone numbers, email addresses and dates of birth of the applicant's directors
and officers.
B. The percentages of
shares of stock, if any, held by each person named in paragraph A
above.
C. For limited liability
companies (hereinafter, "LLC"), including professional LLCs, provide the full
name, address, date of birth and telephone number of each member of the LLC
having an ownership interest of five percent (5%) or more of the LLC. If the
member is not a natural person, disclose the true ownership of the member (and
successive levels of ownership, if necessary) until a natural person or another
corporate entity is disclosed. If another corporate entity is disclosed,
provide a complete disclosure of that corporate entity's ownership in
accordance with the specific rules for that entity contained herein (and
successive levels of ownership, if necessary).
D. For general, limited, or limited liability
partnerships, provide the full name, address, date of birth and telephone
number of each partner having an ownership interest of five percent (5%) or
more of the partnership. If the partner is not a natural person, disclose the
true ownership of the partner (and successive levels of ownership if necessary)
until a natural person, or another corporate entity, is disclosed. If another
corporate entity is disclosed, provide a complete disclosure of that corporate
entity's ownership in accordance with the specific rules for that entity
contained herein (and successive levels of ownership, if necessary).
E. For a corporation, provide the full name,
address, date of birth and telephone number of any natural person or entity
having an ownership interest of five percent (5%) or more of the outstanding
shares of the corporation. If a corporate entity is disclosed, provide a
complete disclosure of that corporate entity's ownership in accordance with the
specific rules for that entity contained herein (and successive levels of
ownership, if necessary).
F. The
intent of this rule is to require, to the fullest extent that the individual or
corporate structure of an applicant allows, disclosure of names of individual
natural persons who have a significant ownership interest in a fantasy contest
operator.
3. Copies of
the applicant's audited financial statements for the preceding three (3) fiscal
years and a copy of internally prepared financial statements for the current
fiscal year as of the close of the most recent fiscal quarter;
4. A copy of the Certificate of Authority to
do business in the State of Maine, if incorporated outside of Maine;
5. Copies of any trade name registrations
filed by the applicant;
6.
Completed notarized affirmation and consent and authorization to release
information to complete a criminal background check on: the applicant; any
officer or director of the applicant; and any partner or shareholder who has an
ownership interest of five percent (5%) or more in the fantasy contest operator
or who is involved in the day to day management of fantasy contests and
operations;
7. A copy of the
minimum internal controls adopted to verify the identity of individuals seeking
to establish accounts;
8. The
applicant's minimum internal controls related to protection of fantasy
contestant deposits, including minimum internal controls related to the
following:
A. Prevention of unauthorized
withdrawals from fantasy contestant accounts by fantasy contest operators or
others;
B. Reporting and responding
to complaints by a fantasy contestant regarding the handling of the fantasy
contestant account; and
C. Closure
of fantasy contestant accounts.
9. The applicant's minimum internal controls
related to account monitoring to prevent cheating, manipulation or misuse of
accounts, including minimum internal controls related to the following:
A. Detection and prevention of misuse of
proxy servers;
B. Location
verification;
C. Prevention of the
use of unauthorized 3rd party scripts; and
D. Prevention of the use of pre-selected
teams.
10. The
applicant's minimum internal controls relating to fantasy contests for beginner
fantasy contestants, including minimum internal controls related to the
following:
A. Explanation of contest
play;
B. Identification of highly
experienced fantasy contestants, including symbols or other identification
used;
C. Recommending
beginner-fantasy-contestant-only contests and low-cost private
contests;
D. Percentage of contests
open only to beginner fantasy contestants and that exclude highly experienced
fantasy contestants;
E. Prevention
of access by highly experienced fantasy contestants to contests for beginner
fantasy contestants directly or through a proxy; and
F. Suspension of accounts of highly
experienced fantasy contestants who participate in contests for beginner
fantasy contestants only.
11. The applicant's minimum internal controls
relating to the locking of or making any changes to fantasy contests;
12. The applicant's minimum internal controls
relating to ensuring that winning outcomes of fantasy contests reflect the
relative knowledge and skill of the fantasy contestant and that winning
outcomes of fantasy contests are determined primarily by accumulated
statistical results of the performance of human competitors in sports
events;
13. The applicant's minimum
internal controls relating to not allowing the deposit of funds into an account
that is derived from the extension of credit by affiliates or agents of the
fantasy contest operator. For purposes of this subsection, credit shall not be
deemed to have been extended where, although funds have been deposited into an
account, the operator is awaiting actual receipt of such funds in the ordinary
course of business;
14. The
applicant's minimum internal controls that:
A.
Make clear that the funds in the segregated account do not belong to the
fantasy contest operator and are not available to creditors other than the
fantasy contestant whose funds are being held;
B. Prevent commingling of funds in the
segregated account with other funds including, without limitation, funds of the
operator;
C. Disclose the number of
entries that a fantasy contestant may submit to each fantasy contest and
provide reasonable steps to prevent fantasy contestants from submitting more
than the allowable number;
D.
Prohibit fantasy contestants from submitting more than one entry in any fantasy
contest involving 12 entries or fewer;
E. Prohibit fantasy contestants from
submitting more than 2 entries in any fantasy contest involving more than 12
entries but fewer than 36 entries;
F. Prohibit fantasy contestants from
submitting more than 3 entries in any fantasy contest involving 36 or more
entries but fewer than 101 entries;
G. Prohibit, unless otherwise provided by
M.R.S. Title 8, Chapter 33, fantasy contestants from submitting more than 3% of
all entries in any fantasy contest involving more than 100 entries;
H. Permit unlimited entries in no more than
3% of all fantasy contests; the entry fee for such contests must be a minimum
of $150;
I. Inform fantasy
contestants of state and federal tax obligations on certain winnings;
J. Include policies and procedures relating
to assistance available for compulsive behavior; and
K. Include policies and procedures relating
to implementation and enforcement of self-limitations and self-exclusions
requested by fantasy contestants.
