Code of Maryland Regulations
Title 36 - MARYLAND STATE LOTTERY AND GAMING CONTROL AGENCY
Subtitle 10 - SPORTS WAGERING PROVISIONS
Chapter 36.10.14 - Sports Wagering Requirements and Limitations
Section 36.10.14.06 - Reserve
Universal Citation: MD Code Reg 36.10.14.06
Current through Register Vol. 51, No. 19, September 20, 2024
A. A sports wagering licensee shall maintain a reserve in cash, cash equivalents, irrevocable letter of credit, surety bond set forth in §F of this regulation, or a combination thereof in an amount approved by the Commission to cover the outstanding liability of the sports wagering licensee to bettors.
B. A sports wagering licensee may not remove, release, or withdraw funds from its reserve without the written approval of the Commission.
C. The amount in the reserve shall be at least $500,000 and equal or exceed the aggregate sum of:
(1) The total amount of funds to cover the
potential liability for all wagers accepted by the sports wagering licensee on
sporting events with outcomes that have not been determined; and
(2) Money owed but unpaid by the sports
wagering licensee to bettors on winning wagers.
D. A sports wagering licensee shall ensure that the reserve is held:
(1) By a financial
institution insured by the Federal Deposit Insurance Corporation and licensed
to transact business in the State; or.
(2) For sports wagering facility licensee, in
cash held on facility premises.
E. A sports wagering licensee shall:
(1) Calculate its reserve requirements each
day; and
(2) If the sports wagering
licensee determines its reserve is insufficient to cover the requirement of
this regulation, notify the Commission in writing:
(a) Within 24 hours of the deficiency;
and
(b) The steps to be taken to
remedy the deficiency.
F. Surety Bonds.
(1) The sports wagering licensee may obtain a
single surety bond or multiple bonds to be used as a cash reserve to pay the
current outstanding liability of all winnings and awards offered to a winning
bettor as set forth in this regulation and COMAR 36.10.13.40.
(2) A surety bond shall:
(a) Be in a form approved by the Agency and:
(i) Identify the sports wagering licensee or
applicant as the principal of the surety bond;
(ii) Indicate what license type and class the
sports wagering licensee or applicant offers or intends to offer in the State
of Maryland;
(iii) Provide that the
surety bond is protected against claims by creditors of the principal,
including the patrons for whose benefit and protection the reserve account is
established;
(iv) Allow the
Director of the Agency or the Director's designee to make demand upon the
surety for the payment of valid winning amounts not paid by the
principal;
(v) Require the sports
wagering licensee to provide an updated listing of winning wagers that form the
basis of the reserve to the Agency within 72 hours;
(vi) Include a statement that within 24 hours
of receiving the updated listing of winning wagers that form the basis of the
reserve that the Agency will commence review of the list of outstanding patron
accounts;
(vii) Include a statement
that within 10 business days of the demand made by the Director or the
Director's designee the processing of the payment will commence;
(viii) Include a statement that within 60
days of the demand made by the Director or the Director's designee issuance of
the payment shall occur; and
(ix)
Include a statement that if the surety provides written notice of withdrawal,
the withdrawal is not effective until 60 days have elapsed after receipt of the
notice.
(b) Be by and
between the sports wagering licensee or applicant and the surety
company;
(c) Identify the Agency as
the obligee;
(d) Specify that it
guarantees the portion of the sports wagering licensee's reserve that is not
covered by a cash reserve; and
(e)
Specify that the surety bond is valid for at least the 5-year license
term.
(3) The sports
wagering licensee or applicant shall provide the original surety bond to the
Agency.
(4) Agency staff may not
issue a sports wagering license unless the applicant or awardee has provided
Agency staff with a copy of any surety bond that comprises any portion of the
reserve the sports wagering licensee is required to hold.
Disclaimer: These regulations may not be the most recent version. Maryland may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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