10 Del. Admin. Code § 205-4.0

Current through Register Vol. 28, No. 7, January 1, 2025

Section 205-4.0 - Licensing of Charitable Gaming Vendors

4.1 Any person who expresses an interest in being selected to be a charitable gaming vendor must file an application for a charitable gaming vendor license in accordance with these rules.

4.2 A charitable gaming vendor shall be licensed in accordance with these rules prior to conducting any business with the lottery office or any charitable video lottery agent; provided, however, that upon a finding of good cause by the Director for each business transaction, the Director may permit an applicant for said license to conduct business transactions prior to the issuance of the license.

4.3 Each person desiring to obtain a license from the agency as a charitable gaming vendor shall submit a license application on a form specified and supplied by the agency. The license application shall, among other things:

4.3.1 Give notice that the applicant will be required to submit to a background investigation.

4.3.2 Require the applicant to supply specified information and documents related to the applicant's fitness and the background of its owners.

4.3.3 Require the applicant to disclose its legal name and its type of business entity (e.g., general or limited partnership, corporation, etc.).

4.4 The Director shall weigh the following factors in his or her evaluation of the application:

4.4.1 The criminal background, if any, of the applicant or any of its officers. No license shall be issued to any applicant if any of the persons identified on the application have been convicted, within ten (10) years prior to the filing of the application, of any felony, a crime of moral turpitude or a crime involving gambling.

4.4.2 The degree to which the applicant has supplied accurate and complete information pursuant to the requirements of these rules.

4.4.3 The extent to which the applicant has cooperated with the agency and the DGE in connection with the background investigation.

4.4.4 Whether the person, or any of its officers, are known to associate with persons of nefarious backgrounds or disreputable character such that the association could adversely affect the general credibility, security, integrity, honesty, fairness or reputation of the lottery office.

4.4.5 With respect to any past conduct which may adversely reflect upon the applicant, the nature of the conduct, the amount of time that has passed since the conduct, the frequency of the conduct and any extenuating circumstances that affect or reduce the impact of the conduct or otherwise reflect upon the applicant's fitness for the license.

4.4.6 The extent, if any, to which the applicant has failed to comply with any applicable tax laws of the federal, state or local governments.

4.4.7 Current prosecution for any offense listed in subsection 4.4 .1; provided, however, that, at the request of the applicant, the Director shall defer his or her decision on the application during the pendency of the charge.

4.4.8 Any other information before the Director, including substantially similar background investigations performed by other agencies or jurisdictions, which relates to the applicant's competency, financial capability, honesty, integrity, reputation, habits, or associations.

4.5 A license shall be issued to the applicant if the Director is satisfied, upon consideration of the factors specified in subsection 4.4, that the applicant would be a fit agent and not pose a threat to the public interest, the reputation of the lottery, or the effective control of the lottery.

4.6 Charitable gaming vendors shall have a valid license to conduct business in the State of Delaware, shall comply with all applicable tax provisions, and shall be qualified to conduct business in Delaware in all other respects.

4.7 Each charitable video lottery machine certified by the Director shall bear a unique serial number and shall conform to the machine model certified by the Director.

4.8 Charitable gaming vendors shall hold harmless the agency, the State of Delaware, and their respective officers and employees for any claims, loss, cost, damage, liability or expense, including, without limitation, legal expense arising out of any hardware or software malfunction resulting in the wrongful award or denial of credits or cash.

4.9 A charitable gaming vendor shall not distribute a charitable video lottery machine for placement in the state unless the charitable video lottery machine has been approved by the agency. Only charitable gaming vendors may apply for approval of a charitable video lottery machine or associated equipment.

4.10 The charitable gaming vendor is responsible for the assembly and initial operation, in the manner approved and licensed by the agency, of all of its charitable video lottery machines and associated equipment. The charitable gaming vendor may not change the assembly or operational functions of any of its charitable video lottery machines approved for placement in Delaware unless a "request for modification to an existing charitable video lottery machine prototype" is made to the agency. Such request must contain all appropriate information relating to the type of change, the reason for the change, and all supporting documentation that may be required. The agency must approve such request prior to any changes being made, and the agency reserves the right to require second testing of charitable video lottery machines after modifications have been made.

4.11 The following ongoing duties are required of all licensed charitable gaming vendors, without limitation:

4.11.1 Promptly report to the agency any violation, or any facts or circumstances that may result in a violation, of state or federal law and/or any rules or regulations adopted pursuant thereto.

4.11.2 Conduct charitable video lottery operations in a manner that does not pose a threat to the public health, safety, or welfare of the citizens of Delaware, or reflect adversely on the security or integrity of the lottery office.

4.11.3 Hold the agency, the Director, the State of Delaware, and its officers and employees harmless from, and defend and pay for the defense of, any and all claims that may be asserted against the agency, the Director, the State of Delaware, and its officers and employees that may arise from the charitable gaming vendor's operation of a charitable video lottery machine, except claims arising from the negligence or willful misconduct of the agency, the Director, the State of Delaware, or its officers or employees.

4.11.4 Maintain all records required to be kept by charitable gaming vendors according to Delaware laws and regulations as well as these rules and any federal laws or regulations.

4.11.5 Notify the Director of any change in ownership. The failure of any new owner to satisfy a background investigation may constitute "cause" for the suspension or revocation of the license.

4.11.6 Supervise its employees and their activities to ensure compliance with these rules.

4.11.7 Comply with all legal requirements of Delaware law and federal laws, including, without limitation, statutes, regulations, orders, these rules, and all of the terms of any contractual agreements entered into with the agency as well as such other requirements as shall be specified by the Director.

10 Del. Admin. Code § 205-4.0

22 DE Reg. 163 (8/1/2018) (Final)