Rules & Regulations of the State of Tennessee
Title 1350 - Tennessee Sports Wagering Advisory Council
Chapter 1350-01 - Sports Gaming License Standards
Section 1350-01-.07 - MAINTENANCE OF LICENSE OR REGISTRATION

Universal Citation: TN Comp Rules and Regs 1350-01-.07

Current through April 3, 2024

In order to maintain its License or Registration, a Licensee or Registrant is required to maintain certain requirements, conditions, and programs. Failure to maintain these requirements, conditions, and programs may result in the suspension or revocation of a License or Registration or imposition of a fine.

(1) Reserve Requirements - Licensees

(a) Licensees shall obtain a Bond in the amount of five hundred thousand dollars ($500,000) in order to conduct sports wagering in the State of Tennessee. The Bond may be used to fund the reserve. The company issuing the Bond shall be financially rated A or better by a nationally recognized rating agency and duly licensed, admitted, and authorized to transact business in the State of Tennessee. Licensees shall provide the original Bond to the Council. The Bond shall be renewable annually and shall list the Council as obligee of the Bond. The Bond may not be cancelled without a minimum of thirty (30) days prior Written Notice to the Council. The form of the Bond to be executed will be made available on the Council's website.

(b) Licensees also shall maintain a reserve in the form of cash, cash equivalents, irrevocable letter of credit, in addition to the above-referenced Bond, of not less than the amount necessary to ensure the ability to cover the outstanding liability related to the Patron accounts.

The outstanding liability shall be the sum of the following amounts:

1. Amounts held by the Licensee for Sports Gaming Patron Accounts;

2. Aggregate amounts accepted by the Licensee as Wagers on Sporting Events with outcomes that have not been determined; and

3. Amounts owed but unpaid by the Licensee on winning Wagers.

(c) Licensees must receive Council approval in order to remove, release, or withdraw funds necessary to meet the Licensee's reserve requirement in subdivision (b) of this section for non-Patron purposes. For the avoidance of doubt, Licensees may remove, release, or withdraw funds that are held in the reserve account that are in excess of the Licensee's reserve requirement in subdivision (b) of this section.

(d) Licensees shall calculate their reserve requirements each day. In the event a Licensee determines that its reserve is not sufficient to cover the calculated requirement, the Licensee, within twenty-four (24) hours, must notify the Council of this occurrence and indicate the steps the Licensee has taken to remedy any deficiency. All reserve funds must be held with a financial institution that is federally insured by the FDIC or NCUA and lawfully operating in Tennessee.

(2) Insurance Requirements - Licensees.

(a) Licensees shall provide the Council with certificates of insurance prior to approval of the License and with each renewal application. The company issuing the insurance shall be financially rated A or better by a nationally recognized rating agency and duly licensed, admitted, and authorized to transact business in the State of Tennessee.

(b) Subject to paragraph (c) below, Licensees shall maintain the following types and amounts of insurance while they are an approved Licensee to conduct Interactive Sports Gaming activities in the State of Tennessee:
1. Licensees who anticipate, during the upcoming year of licensure, having less than 100,000 Player accounts and $15,000,000 in revenue shall maintain the following types and amounts of insurance:
(i) Cyber Liability insurance in the amount of five million dollars ($5,000,000); and

(ii) Errors and Omissions insurance in the amount of five million dollars ($5,000,000).

2. Licensees who anticipate, during the upcoming year of licensure, having more than 100,000 Player accounts and $15,000,000 in revenue, shall maintain the following types of insurance:
(i) Cyber Liability insurance in the amount of ten million dollars ($10,000,000); and

(ii) Errors and Omissions insurance in the amount of ten million dollars ($10,000,000).

(c) Licensees that are unable to obtain the coverage amounts specified in 1350-01-.07(2)(b) must maintain coverage in the maximum amounts allowable by the issuing insurance company. Such Licensees must provide a notarized statement or letter from their insurance agent or broker stating that Licensee was unable to obtain required insurance coverage after diligent effort and the reason for the deficiency. Such Licensee shall provide the Council with a detailed plan of how it intends to compensate for the deficiency in insurance coverage, which must be approved by the Council prior to Licensure.

(3) Periodic Audits.

(a) Licensees.
1. Prior to Licensure and annually thereafter prior to renewal, Licensees shall submit to the Council an audit of the financial statements and condition of the Licensee's Interactive Sports Gaming operations in the State of Tennessee prepared within the preceding twelve-month period by a Certified Public Accountant in accordance with generally accepted accounting principles and applicable state and federal law. If a Licensee has audited financial statements prepared at the parent company level, the Licensee shall include with its audited consolidated financial statements a supplemental schedule (either audited or unaudited) of the Operator's Interactive Sports Gaming operations in Tennessee or an attestation from the Operator's Certified Public Accountant that the Licensee has implemented procedures to accurately report all financial data necessary to determine privilege taxes owed by the Applicant Interactive Sports Gaming operations in Tennessee.

2. Licensees shall establish and maintain books, records, and documents (including electronic storage media) in accordance with generally accepted accounting principles and practices that sufficiently and properly reflect all revenues and expenditures of funds associated with Interactive Sports Gaming.

3. Licensees shall retain all records, financial records, supporting documents, statistical records, and any other documents (including electronic storage media) pertinent to their Interactive Sports Gaming operations for a minimum period of five (5) years from their creation.

4. Books and records pertaining to Interactive Sports Gaming in the State of Tennessee shall be subject to inspection, review, and audit by the Council at any time within the sole discretion of the Council. Licensee shall cooperate in any such inspection, review, or audit.

(b) Registrants.
1. Prior to Registration and annually thereafter prior to renewal, Registrants shall submit financial statements of the Registrant's financial condition prepared within the preceding twelve-month period in accordance with generally accepted accounting principles and applicable state and federal law. A Registrant Applicant may provide financial statements prepared at the parent company level.

2. Registrants shall establish and maintain books, records, and documents (including electronic storage media) in accordance with generally accepted accounting principles and practices that sufficiently and properly reflect all revenues and expenditures of funds associated with Interactive Sports Gaming.

3. Registrants shall retain all records, financial records, supporting documents, statistical records, and any other documents (including electronic storage media) pertinent to involvement with Interactive Sports Gaming for a minimum period of five (5) years from their creation.

4. Books and records pertaining to Interactive Sports Gaming in the State of Tennessee shall be subject to inspection, review, and audit by the Council at any time within the sole discretion of the Council. Registrant shall cooperate in any such inspection, review, or audit.

(4) Financial Reporting and Financial Data Requirements.

(a) The Sports Gaming System must have the ability to deliver all requested data either by report or data file to the Council while achieving compliance with standards of integrity, security, and control required by the Council.

(b) The Sports Gaming System must have the ability to generate reports or data necessary for the Licensee and the Council to determine and record the financial data necessary to determine the privilege tax calculation over a daily, weekly, and monthly period, in a manner determined by the Council.

(c) All data required must be submitted in formats approved by the Council. All Licensees shall utilize the Council's (formerly TEL's) central accounting and reporting system.

(d) All required reports shall be generated by the Sports Gaming System, even if the period specified contains no data to be presented. The report generated shall indicate all required information and contain an indication of "No Activity" or similar message if no data appears for the period specified.

(e) The Council may periodically prescribe a set of standard reporting forms and instructions to be used by each Licensee for filing daily, weekly, monthly, and/or quarterly reports.

(5) Bank Account.

In order to ensure the security of funds due to the State of Tennessee for payment of the privilege tax imposed under the Sports Gaming Act, Licensees shall maintain a bank account, designating the Council as sole beneficiary, with a financial institution that is federally insured by the FDIC or NCUA and lawfully operating in Tennessee. This bank account shall be separate from all other operating accounts of the Licensee and shall hold all amounts calculated by the Licensee to be owed for payment of the privilege tax until payment is made pursuant to paragraph (6) below.

(6) Payment of Privilege Tax

(a) There is imposed upon the Gross Handle of a Licensee a privilege tax of one and eighty-five one hundredths percent (1.85%) of a Licensee's Gross Handle, less allowable deductions.

(b) A Licensee shall pay the privilege tax each month based on its Gross Handle for the immediately preceding calendar month.

(c) A Licensee shall utilize the Cash Basis for calculating and reporting privilege taxes.

(d) A Licensee may deduct the following amounts from the prior month's Gross Wagers prior to calculation of the privilege tax owed:
1. The amount of Federal Excise Tax paid by the Licensee for the prior month;

2. Cancelled Wagers:

3. Voided Wagers; and

4. Resettled Wagers that result in a negative adjustment. Resettled Wagers that result in a positive adjustment must be added to Gross Wagers.

(e) A Licensee may not deduct the following from its Gross Handle prior to calculation of the privilege tax owed:
1. Payouts to Bettors;

2. Promotional Wagers;

3. Promotional Payouts; or

4. Anything not specified in this Rule or that has not otherwise been expressly approved in writing by the Executive Director or his or her designee prior to the deduction.

(f) The privilege tax for the immediately preceding calendar month shall be transferred to the Licensee's escrow account by the fifth (5th) business day of each month. A Licensee shall contemporaneously, in a manner specified by the Council, submit a report showing Gross Handle, Gross Wagers, deductions taken in accordance with subparagraph (d) above, and the total amount of privilege tax owed by the Licensee.

(7) Sports Gaming System Technology Integrity and Security Assessment.

(a) Licensees shall, prior to commencing operations and annually thereafter, prior to renewal, obtain an assessment of the technological integrity and security of their Sports Gaming Systems conducted by an Independent Testing Laboratory that is registered as a Vendor and selected by the Licensee.

(b) The Independent Testing Laboratory's report on the assessment shall be submitted to the Council and shall, at a minimum, include:
1. The scope of review, which shall include, at a minimum, an assessment of the Sports Gaming System's compliance with Rules 1350-01-.06(7)(b) 5., 1350-01-.06(7)(h), 1350-01-.07(7)(a), 1350-03-.03(1) and (2), 1350-03-.03(4), 1350-03-.03(5), 1350-03-.12(1), 1350-03-.12(8), and 1350-03-.12(18);

2. Name and company affiliation of the individual(s) who conducted the assessment;

3. Date of assessment;

4. Findings related to technological integrity and security in accordance with these Rules;

5. Recommended corrective action, if applicable; and

6. The Licensee's response to the findings and recommended corrective action.

(8) Prohibition on Wagers by and Payouts to Minors.

(a) A Licensee shall not permit Wagers to be placed by Minors. Each Licensee shall maintain a system through which it verifies that Wagers are not made by Minors in accordance with Rule 1350-03-.11. Licensee shall prohibit any Minor from collecting payouts or winnings from Interactive Sports Gaming.

(b) Licensee shall provide the Council information about its methodology for verifying the age of a Bettor. Licensee shall notify Council of any changes to its methodology, or if there is a change of any Vendor or provider that provides age verification services to the Licensee within ten (10) days of any such change.

(c) Licensee's system to verify that Wagers are not made by Minors and prohibiting payouts to Minors shall be tested and evaluated as part of the Licensee's Sports Gaming System Operational Assessment.

(9) Prohibited Participants.

(a) Licensees shall not permit Wagers to be placed by Prohibited Participants. A Licensee shall maintain a system through which it verifies that Wagers are not made by Prohibited Participants.

(b) Licensees shall provide the Council information about its methodology for determining whether or not a Player is ineligible due to his/her inclusion in one or more classes of Prohibited Participants as enumerated in the Sports Gaming Act. Licensee shall notify Council of any changes to its methodology pursuant to the change management provisions contained in Rule 1350-03-.02.

(c) Licensees shall prohibit any Person who is included in a class of individuals ineligible to place a Wager pursuant to the Sports Gaming Act from collecting payouts or winnings from Interactive Sports Gaming.

(d) Licensee's system to verify that Wagers are not made by Prohibited Participants and prohibiting payouts to Prohibited Participants shall be tested and evaluated as part of the Licensee's Sports Gaming System Operational Assessment.

(10) Integrity Monitoring.

(a) Licensees shall have controls in place to identify Unusual and Suspicious Wagering Activity and report such activity to the Council and to their Integrity Monitoring Provider according to the Integrity Monitoring System provisions set forth in the MICS contained in these Rules.

(b) Licensee's Integrity Monitoring System procedures shall provide for the sharing of Unusual and Suspicious Wagering Activity with the Council, either directly or through the Licensee's approved Independent Integrity Monitoring Provider.

(c) Licensees shall review reports of Unusual and Suspicious activity received from the Independent Integrity Monitoring Provider of which they are a member and notify the Independent Integrity Monitoring System Provider whether they have experienced similar activity.

(d) If a Licensee finds that previously reported Unusual Wagering Activity rises to the level of Suspicious Wagering Activity or identifies Suspicious Wagering Activity, Licensee shall Immediately Notify the Council.

(e) Licensees reporting on Suspicious Wagering Activities shall be permitted to suspend or cancel Wagering on Events related to the report and must Immediately Notify the Council upon taking such action.

(f) Notwithstanding the other provisions of this section, all information and data received by the Council regarding Unusual or Suspicious Wagering Activity shall be considered confidential. Such data and information may not be revealed in whole or in part except upon the lawful order of a court of competent jurisdiction, or, with any law enforcement entities, regulatory agencies, governing authorities, integrity monitoring organizations or other organization necessary to facilitate integrity monitoring, or with accredited sports governing bodies as required by the Sports Gaming Act or Council.

(11) Participation in Investigations.

(a) Each Licensee and Registrant shall cooperate in good faith with investigations conducted by the Council, sports governing bodies, and law enforcement agencies.

(b) Licensees shall provide or facilitate provision of account-level betting information and data files relating to Persons placing Wagers and any other information necessary for investigations conducted by the Council or law enforcement.

(c) The Council shall investigate, and each Licensee or Registrant shall cooperate with such investigation, upon information and belief that a Licensee or Registrant has failed to comply with the requirements outlined in the Sports Gaming Act or these Rules.

(d) During normal business hours, the Council and its agents may enter the premises of any facility of a Licensee or Registrant that is utilized by the Licensee to operate and conduct Interactive Sports Gaming business in the State of Tennessee for the purpose of inspecting equipment, books, and records kept as required by the Sports Gaming Act or these Rules, to ensure that the Licensee is in compliance with the Sports Gaming Act or these Rules, or to make any other inspection as necessary to enforce the Sports Gaming Act or these Rules. Failure to admit the Council or its agents after presentation of credentials shall be grounds for disciplinary action.

(e) The Council and its agents, including its law enforcement representatives, shall be able to demand access and inspect business records of any Licensee or Registrant without the requirement to obtain a subpoena. Failure to provide access to the Council or its agents after presentation of credentials shall be grounds for disciplinary action.

(f) Each Licensee and Registrant shall maintain all records relating to the conduct of Interactive Sports Gaming in the State of Tennessee for a period of five (5) years.

(g) The Council may investigate any violation of the Sports Gaming Act, the Rules, or any conduct that affects the integrity of Interactive Sports Gaming in the State of Tennessee

(h) Licensees and Registrants shall Immediately Report to the Council any information relating to:
1. Criminal or disciplinary proceedings or non-routine government or law enforcement investigations commenced against the Licensee or Registrant in connection with its operations in any jurisdiction;

2. Unusual or Suspicious Wagering Activity, including activities reported to the federal government pursuant to AML laws and regulations and Wagers placed to conceal or launder funds derived from illegal activity;

3. Any potential or actual breach of a sports governing body's internal rules and codes of conduct pertaining to sports wagering that is known or reasonably should have been known to Licensee or Registrant;

4. Cheating, including wagering activities or patterns that may indicate a concern with the integrity of a Sporting Event;

5. Conduct that corrupts, is intended to corrupt, or unduly influences the betting outcome of a Sporting Event for purposes of financial gain, including match fixing; and

6. An agent or proxy placing a Wager on behalf of another Person, or the use of false identification.

(i) Licensees also must report information relating to conduct described in subparagraph (h), parts 2.-5., above, to the relevant sports governing body and provide Written Notice of its communications to the sports governing body to the Council. With respect to any information provided by a Licensee to a sports governing body, a sports governing body may only use such information for integrity purposes and shall maintain the confidentiality of such information, unless disclosure is required by the Tennessee Sports Gaming Act, Council, other law, court order, or unless the Licensee consents to disclosure.

(j) Licensees shall share with the Council, upon request by the Council, in real time and at the account level, information regarding a Bettor, the amount and type of each Wager, the time the Wager was placed, the location of the Wager, including the Internet protocol address if applicable, the outcome of the Wager, and records of abnormal, Unusual, or Suspicious Wagering Activity related to the Wager. Information shared under this subparagraph shall be submitted in the form and manner as requested by the Council.

(k) If a sports governing body has notified the Council in writing that real-time information sharing for Wagers placed on its Sporting Events is necessary and desirable, Licensees shall share the same information with the sports governing body or its designee with respect to Wagers on its Sporting Events. Such information may be provided in anonymized form and may be used by a sports governing body solely for integrity purposes.

(12) Manner in Which Interactive Sports Gaming May Be Advertised, Marketed, and Promoted.

This Rule is authorized by T.C.A. § 4-49-118 to effectuate the prohibitions of that statute and establish the manner in which a Licensee may advertise its business operations compliant with the Sports Gaming Act.

(a) Licensees shall provide electronic copies of all advertising, marketing, and promotional materials developed by or on behalf of the Licensee to the Council within five (5) business days following their publication, distribution, or airing to the public, as applicable.

(b) Licensees shall not directly advertise or promote Interactive Sports Gaming to Minors.

(c) Advertising, marketing, and promotional materials published, distributed, or aired by or on behalf of a Licensee shall include a responsible gaming message, which includes, at a minimum, a Council-approved problem-gambling helpline number and an assistance and prevention message.
1. Licensees shall include the logo and gambling hotline number for the Tennessee REDLINE, a 24/7 addiction treatment and recovery hotline provided by the Tennessee Association of Alcohol, Drug and other Addiction Services (TAADAS), or another toll-free gambling hotline number as approved by the Council. Logos will be provided to the Licensee for the Tennessee REDLINE by the Council.

2. In areas where space limitations create an issue for use of a logo, copy can be used to communicate the phone number. Individual social media postings (e.g., tweets, Facebook posts) where space is severely limited are not required to include the information set forth in part 1. of subparagraph (c). Social media pages and direct messages sent via social media platforms must contain the information set forth in part 1. of subparagraph (c).

3. In determining whether to approve a Licensee's usage of a toll-free number other than the Tennessee REDLINE, the Council shall consider the following factors:
(i) Whether the toll-free number provides callers with information about services available in the location of the caller;

(ii) Whether the toll-free number provides a direct connection with additional services needed by the caller or requires the caller to place a separate, additional call;

(iii) The hours of operation of the toll-free number;

(iv) Whether the toll-free number allows for text-based communication;

(v) Whether the toll-free number is specifically designed to address responsible gaming, or whether it also encompasses other services;

(vi) The promptness in answering and professionalism of the individuals providing service through the toll-free number; and

(vii) Whether the toll-free number collects, organizes and makes data publicly available, or specifically available to Tennessee, regarding demographics and utilization rates of callers that may be used to research and develop Responsible Gaming protocols.

4. The Council shall post on its website a list of approved toll-free numbers that Licensees may use in their advertisements, which may be amended from time to time to add additional approved toll-free numbers. If the Council amends the list of approved toll-free numbers to remove a previously approved number, the Council will give Licensees thirty (30) days' advance Written Notice so Licensees can remove that number from their advertisements.

(d) Licensees shall communicate the legal age to participate (21 years old and above) on any website, mobile app, and other mediums or forms of advertising, marketing, and promotions.

(e) Advertisements, marketing, or promotions shall not contain images, symbols, celebrity/entertainer endorsements, and/or language designed to appeal specifically to those under 21 years old.

(f) Advertisements, marketing, and promotions shall not imply that Minors may engage in Interactive Sports Gaming, or feature anyone who is or appears to be below 21 years old, unless the individual is a participant in a Sporting Event upon which a wager may be placed;

(g) A Licensee must report the following information regarding compensation, whether monetary or otherwise, paid by a Licensee to an individual who is eligible to participate in Sporting Events upon which a Wager can be placed:
1. The name of the individual being compensated;

2. The amount and form of compensation; and

3. A general description of the service to be performed by the individual.

Upon request of the Council, the Licensee may be required to provide copies of agreements between the Licensee and the individual receiving the compensation.

(h) Licensees shall not advertise in media outlets that appeal primarily to those under the age of 21;

(i) Advertisements, marketing, or promotions shall not be placed before any audience where the majority of the participants is presumed to be below the age of 21 or that targets potentially vulnerable Persons, including self-excluded Bettors;

(j) For Persons who have self-excluded, Licensees shall not target advertising and marketing to such Persons through direct messaging, text, or e-mail.

(k) All direct advertising, marketing, or promotions via e-mail or text message must allow the recipient an option to unsubscribe;

(l) Licensees shall provide the requirements of this paragraph (12) to advertising, marketing, and promotions personnel, contractors, agents, and agencies retained by Licensees or their agents to ensure compliance herewith; and

(m) Failure to adhere to any of the above may be grounds for disciplinary action.

(13) Maintenance of a Self-Exclusion List.

(a) Licensees shall develop and maintain a system to allow individuals to prohibit or restrict themselves from being able to place a Wager with the Licensee. Licensees may offer the option of implementing restrictions that apply solely to the Licensee or may offer individuals the option of implementing restrictions that apply to all Licensees operating in Tennessee, in coordination with the Council. Such self-exclusion list shall be electronically provided to the Council no less than once per week.

(b) Licensees shall submit a monthly report to the Council that includes the number of individuals who requested to exclude themselves from the ability to participate in Interactive Sports Gaming on their Sports Gaming System.

(c) Any individual may request placement on the list of self-excluded individuals, and that Person during any period of exclusion may not collect any winnings or recover any losses resulting from any Interactive Sports Gaming, except that a Player's account balance on settled Wagers placed prior to the exclusion shall be returned to the Player. Individuals who believe they were inadvertently placed on the exclusion list may petition the Executive Director to request removal from the exclusion list by completing an application for removal. The application for removal from the exclusion list may be requested from the Council. Submission of the removal request does not guarantee removal from the exclusion list.

(d) Licensees shall notify a Sports Gaming Account holder via e-mail, mail, or other method approved by the Council, whenever the Sports Gaming Account holder's Sports Wagering Account has been closed or placed in a suspended mode. Such notification shall include the restrictions placed on the Sports Gaming Account and any further course of action needed to remove the restriction.

(e) Licensees shall provide sufficient notice to the Player regarding any additional effects of inclusion on the self-exclusion list. If applicable, such notice shall include language advising the Player that, once included on the self-exclusion list, the Licensee may choose to permanently exclude the Player, regardless of the exclusion period requested.

(14) Reporting Requirements.

Licensees and Registrants shall report, within three (3) business days of the change, any information relating to:

(a) The name, home address, and date of birth of any new Key Personnel;

(b) Potential purchase or sale, transfer, assignment, gift or donation, or other disposal or acquisition of 5% or more ownership of a Licensee or Vendor;

(c) The resignation, termination, removal, or departure of any Key Personnel of a Licensee or Vendor; and

(d) All other information or circumstances which are deemed to be reportable under these Rules.

(15) House Rules.

(a) Licensees shall adopt comprehensive House Rules which shall be submitted to the Council for approval with the initial application for a License. Amendments to the House Rules must be submitted to the Council for approval no less than ten (10) business days prior to their proposed implementation.

(b) At a minimum, the House Rules shall address the following items:
1. A method for the calculation and payment of winning Wagers;

2. The effect of schedule changes;

3. The method of notifying Players of odds or proposition changes;

4. Acceptance of Wagers at terms other than those posted;

5. The method of contacting the Licensee for questions and complaints;

6. A description of Prohibited Participants and others who may be restricted from placing a Wager;

7. The method(s) of funding a Wager;

8. A description of all types of Wagers that may be accepted, including any minimum and maximum Wagers;

9. The method by which the Sports Gaming Operator will identify and cancel Wagers, including defining "Obvious Error";

10. A provision prohibiting the structuring of Bets to avoid federal currency transactional reporting thresholds; and

11. Notice that Wagers are subject to AML standards, including triggers and requirements for filing of Currency Transaction Reports and Suspicious Activity Reports;

(c) House Rules shall be conspicuously accessible on the Licensee's websites and Mobile Applications.

(d) Copies of the House Rules shall be made readily available, upon request, to Players.

(16) Internal Controls.

Licensees shall develop internal controls according to the requirements and specifications found in the MICS in Rule Chapter 1350-03 and industry standards. At a minimum, the internal controls shall address the following items:

(a) Safeguarding assets and revenues;

(b) Safeguarding Sports Gaming Accounts;

(c) Requirements for internal and independent audits of the Licensee;

(d) User access controls for all Interactive Sports Gaming personnel;

(e) Segregation of duties among all Interactive Sports Gaming personnel;

(f) Automated and manual risk management procedures;

(g) Procedures for identifying and reporting fraud, Cheating, and Suspicious or Unusual Wagering Activity;

(h) Procedures for identifying and preventing Minors from engaging in Interactive Sports Gaming;

(i) Procedures to prevent Wagering by Prohibited Participants;

(j) Description of AML compliance standards;

(k) Description of all types of Wagers available to be offered by the Sports Gaming System;

(l) Description of all integrated third-party hardware, software, or systems;

(m) A monitoring system to identify irregularities in volume or odds and swings that could signal Unusual or Suspicious Wagering Activity that should require further investigation; and

(n) Wager or attempt to Wager over any maximum Wager threshold set by the Licensee that qualifies as Unusual or Suspicious Wagering.

(17) Geolocation System.

(a) Licensee shall keep its geolocation system up to date, including integrating the latest versions in real time that can detect the use of remote desktop software, rootkits, virtualization, or any other programs identified by the Council having the ability to circumvent geolocation measures.

(b) The integrity of the geolocation system shall be reviewed regularly, but no less than every one hundred eighty (180) days, by the Licensee to ensure it detects and mitigates existing and emerging location fraud risks, and that is has been updated to incorporate all available patches and updates recommended by the Licensee's Geolocation Service Vendor.

(c) Licensee must either (1) provide the Council evidence that the geolocation system is updated to the latest version every 180 days, or (2) provide the Council with access to its geolocation system (or a dashboard or application utilized by the geolocation system Vendor) so that compliance can be independently verified by the Council.

Authority: T.C.A. §§ 4-49-101, 4-49-102, 4-49-104, 4-49-106, 4-49-109, 4-49-110, 4-49-112, 4-49-115, 4-49-115(f), 4-49-117, 4-49-118, 4-49-119, 4-49-120, 4-49-122, 4-49-123, 4-49-124, 4-49-125, 4-49-127, and 4-49-131; and 2023 Tenn. Pub. Acts, Ch. 450.

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